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 Envestnet Reports Fourth Quarter 2016 Financial Results
   Thursday, March 23, 2017 4:05:02 PM ET

Envestnet (ENV ), a leading provider of intelligent systems for wealth management and financial wellness, today reported financial results for its fourth quarter and full year ended December 31, 2016.

                                                            Three Months Ended                                                   Year Ended                          
Key Financial Metrics                                                             December 31,                                          %                                                December 31,                                                       %
(in millions except per share data)                2016          2015       Change      2016                 2015                      Change
-------------------------------------------- -------------------- -------------------------------- -------------------------------- ---------------------------- ------------------------------ ------------------------------------------------- ---------------------
GAAP:                                                                                                                                                    
    Total Revenues                                                 $ 155.5                          $ 118.4                          31 %                        $ 578.2                        $ 420.9                                37 %
    Net Income (Loss)                                                (32.6 )                           (3.9 )                       n/m                            (55.6 )                          4.4                                                  n/m
    Net Income (Loss) per Diluted Share                            $ (0.75 )                        $ (0.10 )                       n/m                          $ (1.30 )                      $  0.12                                                  n/m
        n/m = not meaningful
                                                                                                                                                                                                                                                   
Non-GAAP:
    Adjusted Revenues(1)                                           $ 156.0                          $ 118.6                          31 %                        $ 579.4                        $ 421.2                                                   38 %
    Adjusted EBITDA(1)                                                30.4                             22.5                          35 %                           99.4                           76.1                                                   31 %
    Adjusted Net Income(1)                                            14.2                             11.3                          25 %                           43.6                           37.7                                                   16 %
    Adjusted Net Income per Diluted Share(1)                       $  0.32                          $  0.28                          14 %                        $  0.98                        $  0.98                                                    0 %
 


"Recent client wins and our new business pipeline validate the interest in Envestnet’s intelligent systems for wealth management and financial wellness," said Jud Bergman, Chairman and CEO.

"After another solid quarter to end 2016, we believe we are well positioned to continue our strong organic growth in 2017 and beyond, as we empower our customers to deliver better outcomes for their clients," concluded Mr. Bergman.

Financial Results for the Fourth Quarter of 2016 Compared to the Fourth Quarter of 2015:

Total revenues increased 31% from $118.4 in the three months ended December 31, 2015 to $155.5 million in the three months ended December 31, 2016. The increase was primarily due to an increase in revenues from subscription and licensing attributable to Yodlee, which was acquired in November 2015. Revenues from assets under management or administration ("AUM/A") were 60% and 70% of total revenues in the fourth quarter of 2016 and 2015, respectively.

Total operating expenses in the fourth quarter of 2016 increased 31% to $158.5 million from $120.9 million in the prior year period. Cost of revenues increased 23% to $48.3 million in the fourth quarter of 2016 from $39.1 million in the fourth quarter of 2015 due to the inclusion of Yodlee and the increase in revenue from AUM or AUA. Compensation and benefits increased 40% to $61.0 million in the fourth quarter of 2016 from $43.6 million in the prior year period primarily due to the inclusion of Yodlee. General and administration expenses increased 28% to $35.2 million in the fourth quarter of 2016 from $27.5 million in the prior year period. Included in general and administration expenses for 2016 was a $6.2 million expense to establish a net liability related to potential state and local non-income tax obligations for 2016 and prior periods.

Loss from operations was $3.1 million for the fourth quarter of 2016 compared to a loss of $2.5 million for the fourth quarter of 2015. Net loss attributable to Envestnet, Inc. was $32.6 million, or a loss of $0.75 per diluted share, for the fourth quarter of 2016 compared to loss of $3.9 million, or a loss of $0.10 per diluted share, for the fourth quarter of 2015. Included in the 2016 net loss figures is a $26.3 million provision for income taxes to establish a valuation allowance against certain deferred tax assets.

Adjusted Revenues in the fourth quarter of 2016 were $156.0 million, increasing 31% over the prior year period. Adjusted EBITDA(1) in the fourth quarter of 2016 was $30.4 million, increasing 35% over the prior year period. Adjusted Net Income(1) was $14.2 million, compared to $11.3 million in the fourth quarter of 2015. Adjusted Net Income Per Share(1) was $0.32, compared to $0.28 in the fourth quarter of 2015.

Financial Results for the Full Year of 2016 Compared to the Full Year of 2015:

Total revenues increased 37% from $420.9 million in the year ended December 31, 2015 to $578.2 million in the year ended December 31, 2016. The increase was primarily due to an increase in revenues from subscription and licensing of $123.0 million, primarily related to the inclusion of Yodlee. Revenues from assets under management or administration ("AUM/A") were 61% and 79% of total revenues in 2016 and 2015, respectively.

Total operating expenses in 2016 increased 50% to $601.6 million from $401.9 million in the prior year. Cost of revenues increased 12% to $180.6 million in 2016 from $161.3 million in 2015 due to the inclusion of Yodlee and the increase in revenue from AUM or AUA. Compensation and benefits increased 73% to $241.6 million in 2016 from $139.8 million in the prior year period primarily due to the inclusion of Yodlee. General and administration expenses increased 58% to $115.4 million in 2016 from $72.9 million in the prior year, also primarily due to the inclusion of Yodlee. Included in general and administration expenses for 2016 was a $6.2 million expense to establish a net liability related to potential state and local non-income tax obligations for 2016 and prior periods.

Loss from operations was $23.4 million for the full year of 2016 compared to income of $19.0 million for the full year of 2015. Net loss attributable to Envestnet, Inc. was $55.6 million, or a loss of $1.30 per diluted share, for the full year of 2016 compared to income of $4.4 million, or $0.12 per diluted share, for the full year of 2015. Included in the 2016 net loss figures is a $26.3 million provision for income taxes to establish a valuation allowance against certain deferred tax assets.

Adjusted Revenues in 2016 were $579.4 million, increasing 38% over the prior year. Adjusted EBITDA(1) in 2016 was $99.4 million, increasing 31% over the prior year. Adjusted Net Income(1) was $43.6 million in 2016, compared to $37.7 million in 2015. Adjusted Net Income Per Share(1) was $0.98 for both 2016 and 2015.

Cash Flow and Financial Position

At December 31, 2016, Envestnet had $52.6 million in cash and cash equivalents, compared to $51.7 million at December 31, 2015. Total debt was $290.9 million at December 31, 2016 compared to $290.8 million at December 31, 2015. No funds were drawn on the $100 million revolving credit facility at the end of the year.

Outlook

The Company provided the following outlook for the first quarter ended March 31, 2017 and full year ended December 31, 2017. This outlook is based on the market value of assets on December 31, 2016 and is risk-adjusted with respect to contributions from client conversions and synergy revenue related to prior acquisitions.

In Millions Except Adjusted EPS                                                              Q1 2017                                                                                 FY 2017
--------------------------------------------                      --------------------------------------------------------------------------------------------------                     --------------------------------------------------------------------------
GAAP:                                                                                                                                                           
    AUM/A revenue                                                                    $  93.0                      -                                         $  93.5                                                   -
                                                                                        55.8                      -                                            56.8                                                   -
    Subscription and licensing revenue
    Professional services and other revenue                           5.0   -       6.0                                                   -
                                                                  -------------------- ----- -------------------- - -------------------- -------------------- -----
    Revenues                                                                         $ 153.8                      -                                         $ 156.3                       $ 649                       -                               $        659
                                                                                                                                                                                                                                              
    Cost of revenues                                                                 $  48.5                      -                                         $  49.5                                                   -
    Net Income                                                                                                    -                                                                                                   -
                                                                                                                                                                                                                                              
    Diluted shares outstanding                                                                                   45.6                                                                                                 -
    Net Income per Diluted Share                                                                                  -                                                                                                   -
                                                                                                                                                                                                                                              
Non-GAAP:
    Adjusted Revenues(1)                                                             $ 154.0                      -                                         $ 156.5                       $ 650                       -                               $        660
    Adjusted EBITDA(1)                                                               $  24.0                      -                                         $  25.0                       $ 120                       -                               $        126
    Adjusted Net Income per Diluted Share(1)                                                                     $0.24                                                                                                -
                                                                                                                                                                     

Included in the first quarter and full year 2017 adjusted revenue is an expected deferred revenue fair value adjustment of approximately $0.2 million and $0.9 million, respectively. The Company does not forecast net income and net income per share due to the unpredictable nature of various items adjusted for non-GAAP disclosure purposes, including the periodic GAAP income tax provision.

Conference Call

Envestnet will host a conference call to discuss fourth quarter 2016 financial results today at 5:00 p.m. ET. The live webcast can be accessed from Envestnet’s investor relations website at http://ir.envestnet.com/ . The call can also be accessed live over the phone by dialing (888) 801-6507, or for international callers (913) 312-1513. A replay will be available one hour after the call and can be accessed by dialing (844) 512-2921 or (412) 317-6671 for international callers; the conference ID is 2401766. The dial-in replay will be available for one week and the webcast replay will be available for one month following the date of the conference call.

Update on Form 10-K Filing

On March 2, 2017, Envestnet filed a Form 12b-25 with the Securities and Exchange Commission (the "SEC") indicating that it would not be able to file its Form 10-K for the year ended December 31, 2016 (the "2016 Form 10-K") on a timely basis as a result of its inability to complete a timely review of the magnitude of its potential liability for state and local sales, use and similar taxes. Envestnet expects to file its 2016 Form 10-K on or about March 27, 2017.

As a result of the filing delay, Envestnet received a letter from the New York Stock Exchange (the "NYSE") notifying Envestnet that it was not currently in compliance with the NYSE’s continued listing requirements under the timely filing criteria set forth in Section 802.01E of the NYSE Listed Company Manual. Such notices are routinely issued by the NYSE in situations when there are late filings with the SEC. Under NYSE rules, Envestnet has six months from March 1, 2017, to file its 2016 Form 10-K with the SEC. Envestnet can regain compliance with the NYSE listing standards at any time during this six-month period once it files its 2016 Form 10-K with the SEC. If Envestnet fails to file its 2016 Form 10-K within such six-month period, the NYSE may, in its sole discretion, allow Envestnet’s common stock to trade for up to an additional six months depending on specific circumstances as outlined in the rule. Until Envestnet files its 2016 Form 10-K, its common stock will remain listed on the NYSE under the symbol "ENV," but will be assigned an "LF" indicator to signify late filing status. The filing by Envestnet of its 2016 Form 10-K on or about March 27, 2017 will automatically result in Envestnet regaining compliance with the NYSE’s continued listing requirements.

About Envestnet

Envestnet, Inc. (ENV ) is a leading provider of intelligent systems for wealth management and financial wellness. Envestnet’s unified technology enhances advisor productivity and strengthens the wealth management process. Envestnet empowers enterprises and advisors to more fully understand their clients and deliver better outcomes.

Envestnet enables financial advisors to better manage client outcomes and strengthen their practices. Institutional-quality research and advanced portfolio solutions are provided through Envestnet | PMC, our Portfolio Management Consultants group. Envestnet | Yodlee is a leading data aggregation and data analytics platform powering dynamic, cloud-based innovation for digital financial services. Envestnet | Tamarac provides leading rebalancing, reporting, and practice management software for advisors. Envestnet | Retirement Solutions provides retirement advisors with an integrated platform that combines leading practice management technology, research and due diligence, data aggregation, compliance tools, fiduciary solutions and intelligent managed account solutions.

More than 54,000 advisors and 2,500 companies including: 16 of the 20 largest U.S. banks, 38 of the 50 largest wealth management and brokerage firms, over 500 of the largest Registered Investment Advisers, and hundreds of Internet services companies, leverage Envestnet technology and services. Envestnet solutions enhance knowledge of the client, accelerate client on-boarding, improve client digital experiences, and help drive better outcomes for enterprises, advisors, and their clients.

For more information on Envestnet, please visit www.envestnet.com and follow @ENVintel (https://twitter.com/envintel).

(1) Non-GAAP Financial Measures

"Adjusted revenues" exclude the effect of purchase accounting on the fair value of acquired deferred revenue. Under United States generally accepted accounting principles (GAAP), we record at fair value the acquired deferred revenue for contracts in effect at the time the entities were acquired. Consequently, revenue related to acquired entities for periods subsequent to the acquisition does not reflect the full amount of revenue that would have been recorded by these entities had they remained stand-alone entities.

"Adjusted EBITDA" represents net income before deferred revenue fair value adjustment, interest income, interest expense, accretion on contingent consideration, income tax provision (benefit), depreciation and amortization, non-cash compensation expense, restructuring charges and transaction costs, severance, fair market value adjustment on contingent consideration, litigation related expense, foreign currency and related hedging activity, non-income tax expense adjustment, other (income) expense, impairment of equity method investment, loss allocation from equity method investment and loss attributable to non-controlling interest.

"Adjusted net income" represents net income before deferred revenue fair value adjustment, non-cash interest expense, non-cash compensation expense, accretion on contingent consideration, restructuring charges and transaction costs, severance, fair market value adjustment on contingent consideration, amortization of acquired intangibles, litigation related expense, foreign currency and related hedging activity, non-income tax expense adjustment, other (income) expense, impairment of equity method investment, loss allocation from equity method investment and loss attributable to non-controlling interest. Reconciling items are presented gross of tax, and a normalized tax rate is applied to the total of all reconciling items to arrive at adjusted net income. The reconciling items, and resulting adjusted net income, are presented on a different basis than historically shown to eliminate the impact of quarterly volatility of the GAAP tax provision (benefit) on the Company’s adjusted earnings figures.

"Adjusted net income per diluted share" represents adjusted net income divided by the diluted number of weighted-average shares outstanding.

See reconciliation of Non-GAAP Financial Measures on pages 10, 11 and 12 of this press release. Reconciliations are not provided for guidance on such measures as the Company is unable to predict the amounts to be adjusted, such as the GAAP tax provision. The Company’s Non-GAAP Financial Measures should not be viewed as a substitute for revenues, net income or net income per share determined in accordance with GAAP.

Cautionary Statement Regarding Forward-Looking Statements

The forward-looking statements made in this press release and its attachments concerning, among other things, Envestnet, Inc.’s (the "Company") expected financial performance and outlook for the first quarter and full year of 2017, its strategic operational plans and growth strategy are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties and the Company’s actual results could differ materially from the results expressed or implied by such forward-looking statements. Furthermore, reported results should not be considered as an indication of future performance. The potential risks, uncertainties and other factors that could cause actual results to differ from those expressed by the forward-looking statements in this press release include, but are not limited to, potential exposure to state and local non-income tax obligations, the impact of the Company’s failure to file its Form 10-K on a timely basis, the Company’s ability to remediate material weaknesses in internal controls over financial reporting and associated costs, difficulty in sustaining rapid revenue growth, which may place significant demands on the Company’s administrative, operational and financial resources, fluctuations in the Company’s revenue, the concentration of nearly all of the Company’s revenues from the delivery of investment solutions and services to clients in the financial services industry, the impact of market and economic conditions on revenues, the Company’s reliance on a limited number of clients for a material portion of its revenue, the renegotiation of fee percentages or termination of the Company’s services by its clients, the Company’s ability to identify potential acquisition candidates, complete acquisitions and successfully integrate acquired companies, the impact of market conditions on the Company’s ability to issue additional debt and equity to fund acquisitions, compliance failures, regulatory or third-party actions against the Company, the failure to protect the Company’s intellectual property rights, the Company’s inability to successfully execute the conversion of its clients’ assets from their technology platform to the Company’s technology platform in a timely and accurate manner, general economic conditions, political and regulatory conditions, the impact of fluctuations in interest rates on the Company’s business, ability to expand our relationships with existing customers, grow the number of customers and derive revenue from new offerings such as our data analytic solutions and market research services and premium FinApps, the results of our investments in research and development, our data center and other infrastructure, our ability to realize operating efficiencies, the advantages of our solutions as compared to those of others, our ability to retain and hire necessary employees and appropriately staff our operations, in particular our India operations, and management’s response to these factors. More information regarding these and other risks, uncertainties and factors is contained in the Company’s filings with the Securities and Exchange Commission ("SEC") which are available on the SEC’s website at www.sec.gov or the Company’s Investor Relations website at http://ir.envestnet.com/ . You are cautioned not to unduly rely on these forward-looking statements, which speak only as of the date of this press release. All information in this press release and its attachments is as of March 23, 2017 and, unless required by law, the Company undertakes no obligation to publicly revise any forward-looking statement to reflect circumstances or events after the date of this press release or to report the occurrence of unanticipated events.

                                                                                       Envestnet, Inc.
                                                                            Condensed Consolidated Balance Sheets
                                                                                       (in thousands)
                                                                                         (unaudited)
 
                                                                                                      December 31,
                                                                   -------------------------------------------------------------------------------------------------------------------------
                                                                                          2016                                                2015
                                                                   -----------------------------------------------                        -----------------------------------------------
Assets
Current assets:
    Cash and cash equivalents                                                         $  52,592                                                              $  51,718
    Fees and other receivables, net                                                      44,268                                                                 46,756
    Prepaid expenses and other current assets                         16,224                           13,239  
                                                                   -------------------- ------- --------------------                      -------------------- ------- --------------------
        Total current assets                                         113,084                          111,713  
                                                                   -------------------- ------- --------------------                      -------------------- ------- --------------------
                                                                                                                                           
Property and equipment, net                                                              33,000                                                                 28,681
Internally developed software, net                                                       14,860                                                                  9,897
Intangible assets, net                                                                  265,558                                                                292,675
Goodwill                                                                                431,936                                                                421,273
Deferred tax assets, net                                                                      -                                                                  2,688
Other non-current assets                                              13,963                            9,322  
                                                                   -------------------- ------- --------------------                      -------------------- ------- --------------------
        Total assets                                                                  $ 872,401                                           $ 876,249  
                                                                   ==================== ======= ====================                      ==================== ======= ====================
                                                                                                                                           
Liabilities and Equity
Current liabilities:
    Accrued expenses and other liabilities                                            $  87,763                                                              $  83,411
    Accounts payable                                                                     11,480                                                                 10,420
    Current portion of debt                                                              37,926                                                                  6,064
    Contingent consideration                                                              2,286                                                                  2,537
    Deferred revenue                                                  16,499                           15,089  
                                                                   -------------------- ------- --------------------                      -------------------- ------- --------------------
        Total current liabilities                                    155,954                          117,521  
                                                                   -------------------- ------- --------------------                      -------------------- ------- --------------------
                                                                                                                                           
Convertible Notes                                                                       152,575                                                                146,418
Term Notes                                                                              100,409                                                                138,335
Contingent consideration                                                                  2,582                                                                  1,506
Deferred revenue                                                                         15,643                                                                 14,378
Deferred rent and lease incentive                                                        12,060                                                                 10,976
Deferred tax liabilities, net                                                             5,555                                                                      -
Other non-current liabilities                                         13,436                            6,288  
                                                                   -------------------- ------- --------------------                      -------------------- ------- --------------------
        Total liabilities                                            458,214                          435,422  
                                                                   -------------------- ------- --------------------                      -------------------- ------- --------------------
                                                                                                                                           
Redeemable units in ERS                                                                     900                                                                    900
                                                                                                                                           
Equity:
    Stockholders’ equity                                                                412,889                                                                439,529
    Non-controlling interest                                             398                              398  
                                                                   -------------------- ------- --------------------                      -------------------- ------- --------------------
        Total liabilities and equity                                                  $ 872,401                                           $ 876,249  
                                                                   ==================== ======= ====================                      ==================== ======= ====================
 
                                                                                                                                                                           Envestnet, Inc.
                                                                                                                                                           Condensed Consolidated Statements of Operations
                                                                                                                                                       (in thousands, except share and per share information)
                                                                                                                                                                             (unaudited)
 
                                                                                                                     Three Months Ended                                                                                                                   Year Ended
                                                                                                                                           December 31,                                                                                                                                        December 31,
                                                                                  -------------------------------------------------------------------------------------------------------------------------------                     -------------------------------------------------------------------------------------------------------------------------------
                                                                                                          2016                                                   2015                                                                      2016                                                   2015
                                                                                  -----------------------------------------------------                     -----------------------------------------------------                     -----------------------------------------------------                     -----------------------------------------------------
                                                                                                                                                                                                                                                                                                                 
Revenues:
    Assets under management or administration                                                        $     93,529                                                              $     83,212                                                              $    352,498                                                              $    333,684
    Subscription and licensing                                                                             55,822                                                                    30,094                                                                   198,125                                                                    75,280
    Professional services and other                                                      6,129                               5,129                              27,541                              11,955  
                                                                                  -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
        Total revenues                                                                 155,480                             118,435                             578,164                             420,919  
                                                                                  -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
                                                                                                                                                                                                                                                                                                                 
Operating expenses:
    Cost of revenues                                                                                       48,271                                                                    39,101                                                                   180,590                                                                   161,309
    Compensation and benefits                                                                              60,959                                                                    43,594                                                                   241,584                                                                   139,756
    General and administration                                                                             35,186                                                                    27,477                                                                   115,435                                                                    72,900
    Depreciation and amortization                                                       14,127                              10,747                              63,999                              27,962  
                                                                                  -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
        Total operating expenses                                                       158,543                             120,919                             601,608                             401,927  
                                                                                  -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
        Income (loss) from operations                                                                      (3,063 )                                                                  (2,484 )                                                                 (23,444 )                                                                  18,992
Other expense, net                                                                      (3,832 )                                               (3,204 )                                              (17,046 )                                              (10,004 )
                                                                                  -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
        Income (loss) before income tax provision                                                          (6,895 )                                                                  (5,688 )                                                                 (40,490 )                                                                   8,988
Income tax provision (benefit)                                                          25,679                              (1,775 )                                               15,077                               4,552  
                                                                                  -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
        Net income (loss)                                                                                 (32,574 )                                                                  (3,913 )                                                                 (55,567 )                                                                   4,436
Add: Net loss attributable to non-controlling interest                                       -                                   -                                   -                                   -  
                                                                                  -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
        Net income (loss) attributable to Envestnet, Inc.                                            $    (32,574 )                                                            $     (3,913 )                                                            $    (55,567 )                                                            $      4,436  
                                                                                  ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================
                                                                                                                                                                                                                                                                                                                 
Net income (loss) per share attributable to Envestnet, Inc.:
                                                                                                                                                                                                                                                                                                                 
    Basic                                                                                            $      (0.75 )                                                            $      (0.10 )                                                            $      (1.30 )                                                            $       0.12  
                                                                                  ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================
                                                                                                                                                                                                                                                                                                                 
    Diluted                                                                                          $      (0.75 )                                                            $      (0.10 )                                                            $      (1.30 )                                                            $       0.12  
                                                                                  ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================
                                                                                                                                                                                                                                                                                                                 
Weighted average common shares outstanding:
    Basic                                                                           43,155,793                          39,019,123                          42,814,222                          36,500,843  
                                                                                  ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================
                                                                                                                                                                                                                                                                                                                 
    Diluted                                                                         43,155,793                          39,019,123                          42,814,222                          38,386,873  
                                                                                  ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================
                                                                                                                                                                                                                                                                                                                                                 
                                                                                                     Envestnet, Inc.
                                                                                     Condensed Consolidated Statements of Cash Flows
                                                                                                     (in thousands)
                                                                                                       (unaudited)
 
                                                                                                                                    Year Ended
                                                                                                                                                      December 31,
                                                                                               --------------------------------------------------------------------------------------------------------------------------
                                                                                                                      2016                                                2015
                                                                                               --------------------------------------------------                     ---------------------------------------------------
OPERATING ACTIVITIES:
    Net income (loss)                                                                                             $ (55,567 )                                                            $    4,436
    Adjustments to reconcile net income (loss) to net cash provided by
    operating activities:
        Depreciation and amortization                                                                                63,999                                                                  27,962
        Deferred rent and lease incentive                                                                              (438 )                                                                 1,819
        Provision for doubtful accounts                                                                               1,122                                                                     176
        Deferred income taxes                                                                                         5,584                                                                 (10,508 )
        Stock-based compensation expense                                                                             33,276                                                                  15,161
        Excess tax benefits from stock-based compensation expense                                                    (4,455 )                                                               (17,607 )
        Non-cash interest expense                                                                                     8,244                                                                  10,271
        Accretion on contingent consideration                                                                           150                                                                     888
        Fair market value adjustment on contingent consideration                                                      1,588                                                                  (4,153 )
        Loss allocation from equity method investment                                                                 1,420                                                                       -
        Impairment of equity method investment                                                                          734
        Loss on disposal of fixed assets                                                                                398                                                                       -
        Changes in operating assets and liabilities, net of acquisitions:
            Fees and other receivables                                                                                1,646                                                                  (9,297 )
            Prepaid expenses and other current assets                                                                (3,290 )                                                                14,716
            Other non-current assets                                                                                    (98 )                                                                (6,025 )
            Accrued expenses and other liabilities                                                                   17,174                                                                 (13,653 )
            Accounts payable                                                                                           (462 )                                                                 3,128
            Deferred revenue                                                                                          2,014                                                                  10,906
            Other non-current liabilities                                                          3,776                            (3,792 )
                                                                                               -------------------- ------- --------------------                      -------------------- -------- --------------------
Net cash provided by operating activities                                                         76,815                            24,428  
                                                                                               -------------------- ------- --------------------                      -------------------- -------- --------------------
                                                                                                                                                                       
INVESTING ACTIVITIES:
    Purchase of property and equipment                                                                              (13,967 )                                                                (9,184 )
    Capitalization of internally developed software                                                                  (8,609 )                                                                (5,532 )
    Investment in private companies                                                                                  (2,238 )                                                                (1,500 )
    Purchase of ERS units                                                                                            (1,500 )                                                                  (100 )
    Acquisition of businesses, net of cash acquired                                              (31,613 )                                           (328,305 )
                                                                                               -------------------- ------- --------------------                      -------------------- -------- --------------------
Net cash used in investing activities                                                            (57,927 )                                           (344,621 )
                                                                                               -------------------- ------- --------------------                      -------------------- -------- --------------------
                                                                                                                                                                       
FINANCING ACTIVITIES:
    Proceeds from borrowings of Term Notes                                                                                -                                                                 160,000
    Payment of Term Notes                                                                                            (8,000 )                                                               (10,000 )
    Proceeds from borrowings on revolving credit facility                                                            40,000                                                                  10,000
    Payments on revolving credit facility                                                                           (40,000 )                                                               (10,000 )
    Payments of contingent consideration                                                                             (3,729 )                                                                (7,219 )
    Payments of purchase consideration liabilities                                                                   (3,256 )                                                                     -
    Issuance of redeemable units in ERS                                                                                   -                                                                     900
    Proceeds from exercise of stock options                                                                           4,924                                                                   8,279
    Excess tax benefits from stock-based compensation expense                                                         4,455                                                                  17,607
    Purchase of treasury stock for stock-based minimum tax withholdings                                             (10,966 )                                                                (7,412 )
    Common stock acquired under the share repurchase program                                                         (1,448 )                                                                     -
    Issuance of restricted stock                                                                       6                                 2  
                                                                                               -------------------- ------- --------------------                      -------------------- -------- --------------------
Net cash provided by (used in) financing activities                                              (18,014 )                                            162,157  
                                                                                               -------------------- ------- --------------------                      -------------------- -------- --------------------
                                                                                                                                                                       
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                                                     874                          (158,036 )
                                                                                               -------------------- ------- --------------------                      -------------------- -------- --------------------
                                                                                                                                                                       
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                                                                       51,718                                                                 209,754
                                                                                                                                                    
                                                                                               --------------------------------------------------                     ---------------------------------------------------
CASH AND CASH EQUIVALENTS, END OF PERIOD                                                                          $  52,592                                           $   51,718  
                                                                                               ==================== ======= ====================                      ==================== ======== ====================
 
                                                                                                                                                                           Envestnet, Inc.
                                                                                                                                                            Reconciliation of Non-GAAP Financial Measures
                                                                                                                                                       (in thousands, except share and per share information)
                                                                                                                                                                             (unaudited)
 
                                                                                                                     Three Months Ended                                                                                                                   Year Ended
                                                                                                                                           December 31,                                                                                                                                        December 31,
                                                                                  -------------------------------------------------------------------------------------------------------------------------------                     -------------------------------------------------------------------------------------------------------------------------------
                                                                                                          2016                                                   2015                                                                      2016                                                   2015
                                                                                  -----------------------------------------------------                     -----------------------------------------------------                     -----------------------------------------------------                     -----------------------------------------------------
                                                                                                                                                                                                                                                                                                                 
Revenues                                                                                             $    155,480                                                              $    118,435                                                              $    578,164                                                              $    420,919
    Deferred revenue fair value adjustment                                                 489                                 188                               1,270                                 322  
                                                                                  -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
Adjusted revenues                                                                                    $    155,969                                           $    118,623                                           $    579,434                                           $    421,241  
                                                                                  ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================
                                                                                                                                                                                                                                                                                                                 
Net income (loss)                                                                                    $    (32,574 )                                                            $     (3,913 )                                                            $    (55,567 )                                                            $      4,436
Add (deduct):
    Deferred revenue fair value adjustment                                                                    489                                                                       188                                                                     1,270                                                                       322
    Interest income                                                                                            (9 )                                                                     (50 )                                                                     (37 )                                                                    (338 )
    Interest expense                                                                                        4,255                                                                     3,190                                                                    16,600                                                                    10,271
    Accretion on contingent consideration                                                                       7                                                                        94                                                                       150                                                                       888
    Income tax provision (benefit)                                                                         25,679                                                                    (1,775 )                                                                  15,077                                                                     4,552
    Depreciation and amortization                                                                          14,127                                                                    10,747                                                                    63,999                                                                    27,962
    Non-cash compensation expense                                                                           7,528                                                                     5,004                                                                    33,276                                                                    15,160
    Restructuring charges and transaction costs                                                             1,300                                                                     8,054                                                                     5,784                                                                    13,495
    Severance                                                                                               1,238                                                                       818                                                                     4,342                                                                     1,695
    Fair market value adjustment on contingent consideration                                                  750                                                                      (362 )                                                                   1,588                                                                    (4,153 )
    Litigation related expense                                                                              1,526                                                                        65                                                                     5,591                                                                        65
    Foreign currency and related hedging activity                                                             (44 )                                                                      (9 )                                                                    (716 )                                                                       -
    Other (income) expense                                                                                 (1,384 )                                                                      42                                                                    (1,384 )                                                                      72
    Non-income tax expense adjustment                                                                       6,229                                                                         -                                                                     6,229                                                                         -
    Impairment of equity method investment                                                                    734                                                                         -                                                                       734                                                                         -
                                                                                                              290                                                                        31                                                                     1,420                                                                         -
    Loss allocation from equity method investment
                                                                                           294                                 338                               1,081                               1,643  
    Loss attributable to non-controlling interest
                                                                                  -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
Adjusted EBITDA                                                                                      $     30,435                                           $     22,462                                           $     99,437                                           $     76,070  
                                                                                  ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================
                                                                                                                                                                                                                                                                                                                 
Net income (loss)                                                                                    $    (32,574 )                                                            $     (3,913 )                                                            $    (55,567 )                                                            $      4,436
Income tax provision (benefit) (1)                                                      25,679                              (1,775 )                                               15,077                               4,552  
                                                                                  -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
Income (loss) before income tax provision                                                            $     (6,895 )                                                            $     (5,688 )                                                            $    (40,490 )                                                            $      8,988
Add (deduct):
    Deferred revenue fair value adjustment                                                                    489                                                                       188                                                                     1,270                                                                       322
    Non-cash interest expense                                                                               2,174                                                                     1,768                                                                     8,244                                                                     6,393
    Non-cash compensation expense                                                                           7,528                                                                     5,004                                                                    33,276                                                                    15,160
    Accretion on contingent consideration                                                                       7                                                                        94                                                                       150                                                                       888
    Restructuring charges and transaction costs                                                             1,300                                                                     8,054                                                                     5,784                                                                    13,495
    Severance                                                                                               1,238                                                                       818                                                                     4,342                                                                     1,695
    Fair market value adjustment on contingent consideration                                                  750                                                                      (362 )                                                                   1,588                                                                    (4,153 )
    Amortization of acquired intangibles                                                                    9,359                                                                     7,433                                                                    45,515                                                                    17,636
    Litigation related expense                                                                              1,526                                                                        65                                                                     5,591                                                                        65
    Foreign currency and related hedging activity                                                             (44 )                                                                      (9 )                                                                    (716 )                                                                       -
    Other (income) expense                                                                                 (1,384 )                                                                       -                                                                    (1,384 )                                                                      72
    Non-income tax expense adjustment                                                                       6,229                                                                         -                                                                     6,229                                                                         -
    Impairment of equity method investment                                                                    734                                                                         -                                                                       734                                                                         -
    Loss allocation from equity method investment                                                             290                                                                        31                                                                     1,420                                                                         -
    Loss attributable to non-controlling interest                                          294                                 338                               1,081                               1,643  
                                                                                  -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
Adjusted net income before income tax effect                                                               23,595                                                                    17,734                                                                    72,634                                                                    62,204
Income tax effect (2)                                                                   (9,438 )                                               (6,411 )                                              (29,054 )                                              (24,509 )
                                                                                  -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
Adjusted net income                                                                                  $     14,157                                           $     11,323                                           $     43,580                                           $     37,695  
                                                                                  ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================
                                                                                                                                                                                                                                                                                                                 
Basic number of weighted-average shares outstanding                                                    43,155,793                                                                39,019,123                                                                42,814,222                                                                36,500,843
Effect of dilutive shares:
    Options to purchase common stock                                                                    1,206,908                                                                 1,396,145                                                                 1,278,827                                                                 1,700,248
    Unvested restricted stock units                                                    478,820                              39,518                             486,823                             185,782  
                                                                                  -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
Diluted number of weighted-average shares outstanding                               44,841,521                          40,454,786                          44,579,872                          38,386,873  
                                                                                  ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================
                                                                                                                                                                                                                                                                                                                 
Adjusted net income per share - diluted                                                              $       0.32                                           $       0.28                                           $       0.98                                           $       0.98  
                                                                                  ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================
(1) For the three months ended December 31, 2016 and 2015, the
effective tax rate computed in accordance with US GAAP equaled
(372.4%) and 31.2%, respectively. For year ended December 31, 2016
and 2015, the effective tax rate computed in accordance with US GAAP
equaled (37.2%) and 50.6%, respectively.
 
(2) For 2016 periods presented, an estimated normalized effective
tax rate of 40% has been used to compute adjusted net income.
 
                                                                                                                                                                     Envestnet, Inc.
                                                                                                                                                      Reconciliation of Non-GAAP Financial Measures
                                                                                                                                                                   Segment Information
                                                                                                                                                                     (in thousands)
                                                                                                                                                                       (unaudited)
 
                                                                                                                                                                            For the Three Months Ended December 31, 2016
                                                                                  ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                       Envestnet                                     Envestnet | Yodlee                                      Non-Segment                                            Total
                                                                                  --------------------------------------------------                     -------------------------------------------------                     --------------------------------------------------                     --------------------------------------------------
                                                                                                                                                                                                                                                                                                       
Revenues                                                                                             $ 119,215                                                              $ 36,265                                                              $       -                                                              $ 155,480
    Deferred revenue fair value adjustment                                              215                             274                                -                              489  
                                                                                  -------------------- ------- --------------------                      -------------------- ------ --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------
Adjusted revenues                                                                                    $ 119,430                                           $ 36,539                                           $       -                                           $ 155,969  
                                                                                  ==================== ======= ====================                      ==================== ====== ====================                      ==================== ======= ====================                      ==================== ======= ====================
                                                                                                                                                                                                                                                                                                       
Income (loss) from operations                                                                        $   9,253                                                              $ (4,819 )                                                            $  (7,497 )                                                            $  (3,063 )
Add (deduct):
    Deferred revenue fair value adjustment                                                                 215                                                                   274                                                                      -                                                                    489
    Accretion on contingent consideration                                                                    7                                                                     -                                                                      -                                                                      7
    Depreciation and amortization                                                                        5,998                                                                 8,129                                                                      -                                                                 14,127
    Non-cash compensation expense                                                                        3,692                                                                 2,847                                                                    989                                                                  7,528
    Restructuring charges and transaction costs                                                            543                                                                    30                                                                    727                                                                  1,300
    Non-income tax expense adjustment                                                                    6,229                                                                     -                                                                      -                                                                  6,229
    Severance                                                                                            1,315                                                                   (77 )                                                                    -                                                                  1,238
    Fair market value adjustment on contingent consideration                                                 -                                                                     -                                                                    750                                                                    750
    Litigation related expense                                                                               -                                                                 1,526                                                                      -                                                                  1,526
    Foreign currency and related hedging activity                                                            -                                                                     -                                                                      -                                                                      -
    Other loss                                                                                               -                                                                     -                                                                     10                                                                     10
    Loss attributable to non-controlling interest                                       294                               -                                -                              294  
                                                                                  -------------------- ------- --------------------                      -------------------- ------ --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------
Adjusted EBITDA                                                                                      $  27,546                                           $  7,910                                           $  (5,021 )                                                            $  30,435  
                                                                                  ==================== ======= ====================                      ==================== ====== ====================                      ==================== ======= ====================                      ==================== ======= ====================
 
 
                                                                                                                                                                                               For the Three Months Ended December 31, 2015
                                                                                  ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                       Envestnet                                                        Envestnet | Yodlee                                                         Non-Segment                                                               Total
                                                                                  --------------------------------------------------                     -------------------------------------------------                     --------------------------------------------------                     --------------------------------------------------
                                                                                                                                                                                                                                                                                                       
Revenues                                                                                             $ 104,354                                                              $ 14,081                                                              $       -                                                              $ 118,435
    Deferred revenue fair value adjustment                                              (17 )                                              205                                -                              188  
                                                                                  -------------------- ------- --------------------                      -------------------- ------ --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------
Adjusted revenues                                                                                    $ 104,337                                           $ 14,286                                           $       -                                           $ 118,623  
                                                                                  ==================== ======= ====================                      ==================== ====== ====================                      ==================== ======= ====================                      ==================== ======= ====================
                                                                                                                                                                                                                                                                                                       
Income (loss) from operations                                                                        $  11,175                                                              $ (2,963 )                                                            $ (10,696 )                                                            $  (2,484 )
Add (deduct):
    Deferred revenue fair value adjustment                                                                 (17 )                                                                 205                                                                      -                                                                    188
    Accretion on contingent consideration                                                                   94                                                                     -                                                                      -                                                                     94
    Depreciation and amortization                                                                        6,154                                                                 4,592                                                                      -                                                                 10,746
    Non-cash compensation expense                                                                        3,047                                                                 1,569                                                                    388                                                                  5,004
    Restructuring charges and transaction costs                                                            155                                                                     -                                                                  7,899                                                                  8,054
    Severance                                                                                              804                                                                    14                                                                      -                                                                    818
    Fair market value adjustment on contingent consideration                                                 -                                                                     -                                                                   (361 )                                                                 (361 )
    Litigation related expense                                                                               -                                                                     -                                                                     65                                                                     65
    Loss attributable to non-controlling interest                                       338                               -                                -                              338  
                                                                                  -------------------- ------- --------------------                      -------------------- ------ --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------
Adjusted EBITDA                                                                                      $  21,750                                           $  3,417                                           $  (2,705 )                                                            $  22,462  
                                                                                  ==================== ======= ====================                      ==================== ====== ====================                      ==================== ======= ====================                      ==================== ======= ====================
 
                                                                                                                                                           Envestnet, Inc.
                                                                                                                                            Reconciliation of Non-GAAP Financial Measures
                                                                                                                                                         Segment Information
                                                                                                                                                           (in thousands)
                                                                                                                                                             (unaudited)
 
                                                                                                                                                                      For the Year Ended December 31, 2016
                                                                                  ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                            Envestnet                            Envestnet | Yodlee                                      Non-Segment                                            Total
                                                                                  -----------------------------                     --------------------------------------------------                     --------------------------------------------------                     --------------------------------------------------
                                                                                                                                                                                                                                                                                   
Revenues                                                                                             $ 447,632                                         $ 130,532                                                              $       -                                                              $ 578,164
    Deferred revenue fair value adjustment                                              329                            941                                -                            1,270  
                                                                                  -------------------- -------                      -------------------- ------- --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------
Adjusted revenues                                                                                    $ 447,961                                         $ 131,473                                           $       -                                           $ 579,434  
                                                                                  ==================== =======                      ==================== ======= ====================                      ==================== ======= ====================                      ==================== ======= ====================
                                                                                                                                                                                                                                                                                   
Income (loss) from operations                                                                        $  41,678                                         $ (38,547 )                                                            $ (26,575 )                                                            $ (23,444 )
Add (deduct):
    Deferred revenue fair value adjustment                                                                 329                                               941                                                                      -                                                                  1,270
    Accretion on contingent consideration                                                                  150                                                 -                                                                      -                                                                    150
    Depreciation and amortization                                                                       24,784                                            39,215                                                                      -                                                                 63,999
    Non-cash compensation expense                                                                       12,719                                            15,033                                                                  5,524                                                                 33,276
    Restructuring charges and transaction costs                                                            904                                                64                                                                  4,816                                                                  5,784
    Non-income tax expense adjustment                                                                    6,229                                                 -                                                                      -                                                                  6,229
    Severance                                                                                            3,334                                               670                                                                    338                                                                  4,342
    Fair market value adjustment on contingent consideration                                                 -                                                 -                                                                  1,588                                                                  1,588
    Litigation related expense                                                                               -                                             5,350                                                                    241                                                                  5,591
    Foreign currency and related hedging activity                                                            -                                              (462 )                                                                    -                                                                   (462 )
    Other loss                                                                                               -                                                 -                                                                     33                                                                     33
    Loss attributable to non-controlling interest                                     1,081                              -                                -                            1,081  
                                                                                  -------------------- -------                      -------------------- ------- --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------
Adjusted EBITDA                                                                                      $  91,208                                         $  22,264                                           $ (14,035 )                                                            $  99,437  
                                                                                  ==================== =======                      ==================== ======= ====================                      ==================== ======= ====================                      ==================== ======= ====================
 
 
                                                                                                                                                                                         For the Year Ended December 31, 2015
                                                                                  ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                            Envestnet                                               Envestnet | Yodlee                                                         Non-Segment                                                               Total
                                                                                  -----------------------------                     --------------------------------------------------                     --------------------------------------------------                     --------------------------------------------------
                                                                                                                                                                                                                                                                                   
Revenues                                                                                             $ 406,838                                         $  14,081                                                              $       -                                                              $ 420,919
    Deferred revenue fair value adjustment                                              117                            205                                -                              322  
                                                                                  -------------------- -------                      -------------------- ------- --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------
Adjusted revenues                                                                                    $ 406,955                                         $  14,286                                           $       -                                           $ 421,241  
                                                                                  ==================== =======                      ==================== ======= ====================                      ==================== ======= ====================                      ==================== ======= ====================
                                                                                                                                                                                                                                                                                   
Income (loss) from operations                                                                        $  43,255                                         $  (2,963 )                                                            $ (21,300 )                                                            $  18,992
Add (deduct):
    Deferred revenue fair value adjustment                                                                 117                                               205                                                                      -                                                                    322
    Accretion on contingent consideration                                                                  888                                                 -                                                                      -                                                                    888
    Depreciation and amortization                                                                       23,369                                             4,592                                                                      -                                                                 27,961
    Non-cash compensation expense                                                                       12,141                                             1,569                                                                  1,451                                                                 15,161
    Restructuring charges and transaction costs                                                              -                                                 -                                                                 13,495                                                                 13,495
    Severance                                                                                            1,681                                                14                                                                      -                                                                  1,695
    Fair market value adjustment on contingent consideration                                                 -                                                 -                                                                 (4,152 )                                                               (4,152 )
    Litigation related expense                                                                               -                                                 -                                                                     65                                                                     65
    Loss attributable to non-controlling interest                                     1,643                              -                                -                            1,643  
                                                                                  -------------------- -------                      -------------------- ------- --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------
Adjusted EBITDA                                                                                      $  83,094                                         $   3,417                                           $ (10,441 )                                                            $  76,070  
                                                                                  ==================== =======                      ==================== ======= ====================                      ==================== ======= ====================                      ==================== ======= ====================
 
                                                                                                                                                                                                  Envestnet, Inc.
                                                                                                                                                                                     Historical Assets, Accounts and Advisors
                                                                                                                                                                                    (in millions, except accounts and advisors)
                                                                                                                                                                                                    (unaudited)
 
                                                                                                                                                                                                                  As of
                                                           ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                               December 31,                                            March 31,                                             June 30,                                            September 30,                                         December 31,
                                                                                   2015                                                  2016                                                  2016                                                  2016                                                  2016
                                                           -------------------------------------------------   -------------------- -------------------------------------------------   -------------------- -------------------------------------------------   -------------------- -------------------------------------------------   -------------------- -------------------------------------------------
                                                                                                                                                                                                                                                                                                                                                                
Platform Assets
    Assets Under Management (AUM)                                             $    92,559                                           $    95,489                                           $    96,700                                           $   101,924                                           $   105,178  
    Assets Under Administration (AUA)                          197,177         207,537         220,690         231,831         241,682  
                                                           -------------------- --------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
        Subtotal AUM/A                                                            289,736                                                                  303,026                                                                  317,390                                                                  333,755                                                                  346,860
    Licensing                                                  561,699         576,988         685,952         721,690         748,125  
                                                           -------------------- --------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
Total Platform Assets                                                         $   851,435                        $   880,014                        $ 1,003,342                        $ 1,055,445                        $ 1,094,985  
                                                           ==================== ========= ==================== ==================== ==================== ========= ==================== ==================== ==================== ========= ==================== ==================== ==================== ========= ==================== ==================== ==================== ========= ====================
                                                                                                                                                                                                                                                                                                                                                                
Platform Accounts
    AUM                                                                           490,471                                                                  498,449                                                                  503,147                                                                  519,717                                                                  545,130
    AUA                                                        807,708         904,373         935,870         961,590         994,583  
                                                           -------------------- --------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
        Subtotal AUM/A                                                          1,298,179                                                                1,402,822                                                                1,439,017                                                                1,481,307                                                                1,539,713
    Licensing                                                2,176,068       2,237,427       4,304,645       4,394,670       4,558,883  
                                                           -------------------- --------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
Total Platform Accounts                                      3,474,247       3,640,249       5,743,662       5,875,977       6,098,596  
                                                           ==================== ========= ==================== ==================== ==================== ========= ==================== ==================== ==================== ========= ==================== ==================== ==================== ========= ==================== ==================== ==================== ========= ====================
                                                                                                                                                                                                                                                                                                                                                                
Advisors
    AUM/A                                                                          33,775                                                                   35,718                                                                   35,067                                                                   35,861                                                                   36,483
    Licensing                                                   13,553          13,675          16,081          16,191          17,852  
                                                           -------------------- --------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- -------------------- -------------------- -------------------- --------- --------------------
Total Advisors                                                  47,328          49,393          51,148          52,052          54,335  
                                                           ==================== ========= ==================== ==================== ==================== ========= ==================== ==================== ==================== ========= ==================== ==================== ==================== ========= ==================== ==================== ==================== ========= ====================
 

The following tables summarize the changes in AUM and AUA for the three months ended December 31, 2016:

                                                                                                                Gross                                     Redemp-                                     Net                                              Market                      
In Millions Except Accounts                                                  9/30/2016                                                                Sales                                                         tions                                                        Flows                                                                Impact                                                               12/31/2016
---------------------------------                      -------------------------------------------------                        ----------------------------------------------                        -----------------------------                        ----------------------------------------------                        ---------------------------------------------                        -------------------------------------------------
                                                                                                                                                                                                                                                                                                                                                                                                       
Assets under Management (AUM)                                             $   101,924                                           $  9,916                                           $  (6,635 )                                          $  3,281                                           $   (27 )                                                            $   105,178  
Assets under Administration (AUA)                          231,831                          23,400                          (15,890 )                          7,510                          2,341                            241,682  
                                                       -------------------- --------- --------------------                      -------------------- ------ --------------------                      -------------------- ------- --                      -------------------- ------ --------------------                      -------------------- ----- --------------------                      -------------------- --------- --------------------
    Total AUM/A                                                           $   333,755                                           $ 33,316                                           $ (22,525 )                                          $ 10,791                                           $ 2,314                                           $   346,860  
                                                       ==================== ========= ====================                      ==================== ====== ====================                      ==================== ======= ==                      ==================== ====== ====================                      ==================== ===== ====================                      ==================== ========= ====================
                                                                                                                                                                                                                                                                                                                                                                                                       
        Fee-Based Accounts                                                  1,481,307                                                                                                                                                                                           58,406                                                                                                                                     1,539,713
 

The above AUM/A gross sales figures include $5.3 billion in new client conversions. The Company onboarded an additional $19.0 billion in licensing conversions during the fourth quarter, bringing total conversions for the quarter to $24.3 billion.

The following tables summarize the changes in AUM and AUA for the year ended December 31, 2016:

                                                                                                                 Gross                                     Redemp-                                      Net                                              Market                       
In Millions Except Accounts                                                 12/31/2015                                                                 Sales                                                         tions                                                         Flows                                                                Impact                                                                12/31/2016
---------------------------------                      -------------------------------------------------                        -----------------------------------------------                        -----------------------------                        -----------------------------------------------                        ----------------------------------------------                        -------------------------------------------------
                                                                                                                                                                                                                                                                                                                                                                                                          
Assets under Management (AUM)                                             $    92,559                                           $  34,504                                           $ (26,698 )                                          $   7,806                                           $  4,813                                           $   105,178  
Assets under Administration (AUA)                          197,177                           84,253                          (54,942 )                          29,311                          15,194                            241,682  
                                                       -------------------- --------- --------------------                      -------------------- ------- --------------------                      -------------------- ------- --                      -------------------- ------- --------------------                      -------------------- ------ --------------------                      -------------------- --------- --------------------
    Total AUM/A                                                           $   289,736                                           $ 118,757                                           $ (81,640 )                                          $  37,117                                           $ 20,007                                           $   346,860  
                                                       ==================== ========= ====================                      ==================== ======= ====================                      ==================== ======= ==                      ==================== ======= ====================                      ==================== ====== ====================                      ==================== ========= ====================
                                                                                                                                                                                                                                                                                                                                                                                                          
        Fee-Based Accounts                                                  1,298,179                                                                                                                                                                                            241,534                                                                                                                                      1,539,713
 

The above AUM/A gross sales figures include $17.1 billion in new client conversions. The Company onboarded an additional $137.4 billion in licensing conversions during 2016, bringing total conversions for the year to $154.5 billion.

http://cts.businesswire.com/ct/CT?id=bwnews&sty=20170323006242r1&sid=cmtx6&distro=nx&lang=en

View source version on businesswire.com: http://www.businesswire.com/news/home/20170323006242/en/

SOURCE: Envestnet, Inc.

Envestnet, Inc. 
Investor Relations 
investor.relations@envestnet.com 
312-827-3940 
or 
Media Relations 
mediarelations@envestnet.com


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