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 Envestnet Reports Fourth Quarter and Full Year 2017 Financial Results
   Thursday, February 22, 2018 4:05:07 PM ET

Envestnet (ENV ), a leading provider of intelligent systems for wealth management and financial wellness, today reported financial results for its quarter and year ended December 31, 2017.

 
                                                           Three Months Ended                                                    Year Ended                          
Key Financial Metrics (unaudited)                                                December 31,                                         %                                                                     December 31,                                                       %
                                                                  ------------------------------------                                                                              -----------------------------------------------------
(in millions except per share data)                                  2017         2016                          Change                                              2017                 2016                                         Change
--------------------------------------------                      -------                        ---------                        ------                                            -------                        --------------------------                        -------------------
GAAP:
    Total Revenues                                                 $ 182.9                        $ 155.5                          18 %                                             $ 683.7                                           $ 578.2                                18 %
    Net Income (Loss)                                                 17.6                          (32.6 )                       n/m                                                  (3.3 )                        (55.6 )                             (94 %)
    Net Income (loss) per Diluted Share                            $  0.38                        $ (0.75 )                       n/m                                               $ (0.08 )                                         $ (1.30 )                             (94 %)
                                                                                                                                                                                                                                                                      
Non-GAAP:
    Adjusted Revenues(1)                                           $ 182.9                        $ 156.0                          17 %                                             $ 683.8                                           $ 579.4                                18 %
    Adjusted EBITDA(1)                                                38.7                           30.4                          27 %                                               128.9                                              99.4                                30 %
    Adjusted Net Income(1)                                            18.7                           14.2                          32 %                                                60.6                                              43.6                                39 %
    Adjusted Net Income per Diluted Share(1)                       $  0.40                        $  0.32                          25 %                                             $  1.31                                           $  0.98                                34 %
____________________
n/m - Not meaningful
 


"The fourth quarter completed a year of solid organic growth in revenue, adjusted EBITDA and earnings for Envestnet, driven by strong execution and a healthy market environment," said Jud Bergman, Chairman and CEO. "As we begin 2018, we are focused on integrating FolioDynamix’s customers and employees. And, we continue to pursue our advice- and data- centric strategy to drive adoption of our wealth management and financial wellness platforms."

"We see significant growth opportunities to establish Envestnet as the premier operating system for financial wellness, enabling better outcomes for a network of enterprises, advisors and clients," concluded Mr. Bergman.

Financial Results for the Fourth Quarter of 2017 Compared to the Fourth Quarter of 2016:

Total revenues increased 18% to $182.9 million in the three months ended December 31, 2017 from $155.5 million in the three months ended December 31, 2016. Asset-based revenues, which were 61% and 60% of total revenues for the fourth quarter of 2017 and 2016, respectively, increased 18% from the prior year period. Subscription and licensing revenues increased 17% from the prior year period.

Total operating expenses for the fourth quarter of 2017 increased 7% to $170.2 million from $158.5 million in the prior year period. Cost of revenues increased 20% to $58.0 million for the fourth quarter of 2017 from $48.3 million for the fourth quarter of 2016. Compensation and benefits increased 7% to $65.3 million for the fourth quarter of 2017 from $61.0 million for the prior year period. Compensation and benefits were 36% of total revenues for the fourth quarter of 2017, compared to 39% for the prior year period. General and administration expenses decreased 12% to $30.8 million for the fourth quarter of 2017 from $35.2 million for the prior year period. General and administrative expenses were 17% of total revenues for the fourth quarter of 2017 compared to 23% for the prior year period.

Income from operations was $12.7 million for the fourth quarter of 2017 compared to a loss of $3.1 million for the fourth quarter of 2016. Net income attributable to Envestnet, Inc. was $17.6 million, or $0.38 per diluted share, for the fourth quarter of 2017 compared to a loss of $32.6 million, or a loss of $0.75 per diluted share, for the fourth quarter of 2016.

Adjusted Revenues(1) for the fourth quarter of 2017 increased 17% to $182.9 million from $156.0 million for the prior year period. Adjusted EBITDA(1) for the fourth quarter of 2017 increased 27% to $38.7 million from $30.4 million for the prior year period. Adjusted Net Income(1) increased 32% for the fourth quarter of 2017 to $18.7 million from $14.2 million for the prior year period. Adjusted Net Income per Diluted Share(1) for the fourth quarter of 2017 increased 25% to $0.40 from $0.32 in the fourth quarter of 2016.

The above results are unaudited and could change in connection with the completion of the audit of our full year financial statements.

FolioDynamix Acquisition

On January 2, 2018, Envestnet ("the Company") completed its acquisition of FolioDynamix. In connection with the acquisition, Envestnet paid $195 million in cash for all the outstanding shares of FolioDynamix, subject to certain closing and post-closing adjustments, using a combination of cash on the Company’s balance sheet and borrowings under its revolving credit facility. As a standalone firm, the FolioDynamix platform supported approximately 28,000 advisors, 3.2 million accounts and $899 billion in assets as of December 31, 2017. FolioDynamix’s expected contribution to Envestnet’s 2018 financial results is included in the Outlook section below.

Recent Accounting Pronouncements

Effective January 1, 2018, Envestnet adopted ASU 2014-09, "Revenue from Contracts with Customers," using the modified retrospective method. The new rules impact the accounting for revenue, as well as the costs to obtain customer contracts. While most of the changes in revenue and expense recognition will be immaterial to Envestnet’s financial results, revenues and cost of revenues will be lower under the new rules, beginning in the first quarter of 2018, due to the treatment of certain third party fees. The expected financial impact from these changes in accounting principles is included in the Outlook section below.

Income Taxes

On December 22, 2017, the Tax Cuts and Jobs Act was signed into law in the U.S. The provisions of the new tax law that are effective during 2017 do not have a material impact on Envestnet’s financial statements due to a valuation allowance on our U.S. temporary differences. From a cash tax perspective, we also do not anticipate a material impact as a result of the new tax law due to the use of foreign tax credits and net operating losses. For 2017, we will pay foreign income tax and in the U.S. alternative minimum tax and state income tax.

For purposes of calculating and reporting adjusted net income and adjusted net income per share, we are reducing our estimated normalized effective tax rate from 40% to 27% beginning in 2018. This reflects the new 21% federal statutory rate and an incremental 6% for state taxes. The expected financial impact of this change in assumption is included in the Outlook section below.

Outlook

The Company provided the following outlook for the first quarter ended March 31, 2018 and full year ending December 31, 2018. This outlook is based on the market value of assets on December 31, 2017. As noted above, it also includes the anticipated contribution from FolioDynamix, the change in accounting for certain revenues and expenses under ASU 2014-09, and a lower normalized effective tax rate.

 
In Millions Except Adjusted EPS                   1Q 2018                                         FY 2018
----------------------------------------                      --------------------                     ------------------------------------------------------------------------
GAAP:                                                                                                              
AUM/A revenue                                                 $118.0    -  $120.0                                                  -
Subscription and licensing revenue                              69.5    -    70.0                                                  -
Professional services and other revenue                          4.5    -     5.0                                                  -
                                                              ------ ----- ------
Revenues                                                      $192.0    -  $195.0                      $808.0                      -                                    $823.0
                                                                                                                                                           
Cost of revenues                                               $63.0    -   $64.5                                                  -
Net Income                                                              -                                                          -
                                                                                                                                                           
Diluted shares outstanding                                             47                                                          -
Net Income per Diluted Share                                            -                                                          -
                                                                                                                                                           
Non-GAAP:
Adjusted Revenues(1)                                          $192.0    -  $195.0                      $808.0                      -                                    $823.0
Adjusted EBITDA(1)                                             $30.5    -   $31.5                      $151.0                      -                                    $155.0
Adjusted Net Income per Diluted Share(1)                              $0.36                             $1.78                      -                                    $ 1.83
 

The above outlook for adjusted revenues is equal to GAAP revenues, as the Company currently expects immaterial deferred revenue fair value adjustments in 2018. 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.

As noted above, various items have been incorporated into the Company’s outlook for 2018. Estimates of the impact on growth in revenue and adjusted EBITDA are noted in the table below.

                                                                                                                                                                                                                                    
                                                                                               Approximate Impact on Growth vs. 2017
                                                                                                                                                                                                                                    
                                                                                                       Full Year 2018
                                                                                       -----------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                Revenues                                                             Adjusted EBITDA
                                                                                       -------------------------------------------------------------------------------------------                     -------------------------------------------------
Core Business                                                                                12-14%                                             15-17%
Adoption of ASU 2014-09                                                                                                                               (2-3%)                                                                   -
FolioDynamix                                                                                                                                           9-10%                                                                 5-6%
Growth Initiatives                                                                              -                            (2-3%)  
                                                                                       -------------------- -------------------- -------------------- ------ --------------------                      -------------------- ------ --------------------
                                                                                                                                                                                                                                    
Guidance Range                                                                               18-20%                          17-20%  
                                                                                       -------------------- -------------------- -------------------- ------ --------------------                      -------------------- ------ --------------------
                                                                                                                                                                                                                                    

Conference Call

Envestnet will host a conference call to discuss fourth quarter 2017 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 (866) 548-4713, or for international callers (323) 794-2093. A replay will be available two hours after the call and can be accessed by dialing (844) 512-2921 or (412) 317-6671 for international callers; the conference ID is 1228086. 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.

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 59,000 advisors and 2,900 companies including: 16 of the 20 largest U.S. banks, 39 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.

____________________ (1) Non-GAAP Financial Measures

"Adjusted revenues" excludes 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 (loss) before deferred revenue fair value adjustment, interest income, interest expense, accretion on contingent consideration and purchase liability, 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, other income, non-income tax expense adjustment, impairment of equity method investment, loss allocation from equity method investment and loss attributable to non-controlling interest.

"Adjusted net income" represents net income (loss) before deferred revenue fair value adjustment, accretion on contingent consideration and purchase liability, non-cash interest expense, non-cash compensation expense, restructuring charges and transaction costs, severance, amortization of acquired intangibles, fair market value adjustment on contingent consideration, litigation related expense, foreign currency and related hedging activity, other income, non-income tax expense adjustment, 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.

"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 9-11 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 expected financial performance and outlook for the first quarter and full year of 2018, 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, the possibility that the anticipated benefits of the Company’s acquisition of FolioDynamix will not be realized to the extent or when expected, potential exposure to state and local non-income tax obligations, 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, potential dilution from issuing equity securities or a weaker balance sheet from using cash or incurring debt to finance acquisitions, 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 February 22, 2018 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,                                               December 31,
                                                                                                   2017                                                                          2016
                                                                         ------------------------------------------------------                        ------------------------------------------------------
Assets
Current assets:
    Cash and cash equivalents                                                               $         60,115                                                              $         52,592
    Fees and other receivables, net                                                                   51,522                                                                        44,268
    Prepaid expenses and other current assets                                      19,470                                  16,224  
                                                                         -------------------- -------------- --------------------                      -------------------- -------------- --------------------
          Total current assets                                                    131,107                                 113,084  
                                                                         -------------------- -------------- --------------------                      -------------------- -------------- --------------------
                                                                                                                                                                             
Property and equipment, net                                                                           35,909                                                                        33,000
Internally developed software, net                                                                    22,174                                                                        14,860
Intangible assets, net                                                                               222,731                                                                       265,558
Goodwill                                                                                             432,955                                                                       431,936
Other non-current assets                                                           17,176                                  13,963  
                                                                         -------------------- -------------- --------------------                      -------------------- -------------- --------------------
          Total assets                                                                      $        862,052                                           $        872,401  
                                                                         ==================== ============== ====================                      ==================== ============== ====================
                                                                                                                                                                             
Liabilities and Equity
Current liabilities:
    Accrued expenses and other liabilities                                                  $        105,897                                                              $         87,763
    Accounts payable                                                                                  11,097                                                                        11,480
    Current portion of debt                                                                   --                                                                        37,926
    Contingent consideration                                                                           2,115                                                                         2,286
    Deferred revenue                                                               21,246                                  16,499  
                                                                         -------------------- -------------- --------------------                      -------------------- -------------- --------------------
          Total current liabilities                                               140,355                                 155,954  
                                                                         -------------------- -------------- --------------------                      -------------------- -------------- --------------------
                                                                                                                                                                             
Convertible Notes                                                                                    158,990                                                                       152,575
Revolving credit facility                                                                             81,168                                                                --
Term Notes                                                                                    --                                                                       100,409
Contingent consideration                                                                                 666                                                                         2,582
Deferred revenue                                                                                      12,047                                                                        15,643
Deferred rent and lease incentive                                                                     15,185                                                                        12,060
Deferred tax liabilities, net                                                                            969                                                                         5,555
Other non-current liabilities                                                      15,102                                  13,436  
                                                                         -------------------- -------------- --------------------                      -------------------- -------------- --------------------
          Total liabilities                                                       424,482                                 458,214  
                                                                         -------------------- -------------- --------------------                      -------------------- -------------- --------------------
                                                                                                                                                                             
Redeemable units in ERS                                                                                  900                                                                           900
                                                                                                                                                                             
Equity:
    Stockholders’ equity                                                  436,272                                                                       412,889
    Non-controlling interest                                                          398                                     398  
                                                                         -------------------- -------------- --------------------                      -------------------- -------------- --------------------
          Total liabilities and equity                                                      $        862,052                                           $        872,401  
                                                                         ==================== ============== ====================                      ==================== ============== ====================
 
                                                                                                                                                                           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,
                                                                                     ---------------------------------------------------------------------------------------------------------------------------------------                     ---------------------------------------------------------------------------------------------------------------------------------------
                                                                                                               2017                                                       2016                                                                          2017                                                       2016
                                                                                     ---------------------------------------------------------                     ---------------------------------------------------------                     ---------------------------------------------------------                     ---------------------------------------------------------
Revenues:
    Assets under management or administration                                                           $        110,748                                                              $         93,529                                                              $        410,016                                                              $        352,498
    Subscription and licensing                                                                                    65,192                                                                        55,822                                                                       245,867                                                                       198,125
    Professional services and other                                                             6,922                                   6,129                                  27,796                                  27,541  
                                                                                     -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------
          Total revenues                                                                      182,862                                 155,480                                 683,679                                 578,164  
                                                                                     -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------
                                                                                                                                                                                                                                                                                                                                                     
Operating expenses:
    Cost of revenues                                                                                              58,006                                                                        48,271                                                                       219,037                                                                       180,590
    Compensation and benefits                                                                                     65,313                                                                        60,959                                                                       264,392                                                                       241,584
    General and administration                                                                                    30,832                                                                        35,186                                                                       121,010                                                                       115,435
    Depreciation and amortization                                                              16,028                                  14,127                                  62,820                                  63,999  
                                                                                     -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------
          Total operating expenses                                                            170,179                                 158,543                                 667,259                                 601,608  
                                                                                     -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------
          Income (loss) from operations                                                                           12,683                                                                        (3,063 )                                                                      16,420                                                                       (23,444 )
Other expense, net                                                                             (4,271 )                                                   (3,832 )                                                  (18,109 )                                                  (17,046 )
                                                                                     -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------
          Income (loss) before income tax provision (benefit)                                                      8,412                                                                        (6,895 )                                                                      (1,689 )                                                                     (40,490 )
Income tax provision (benefit)                                                                 (9,233 )                                                   25,679                                   1,591                                  15,077  
                                                                                     -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------
          Net income (loss)                                                                                       17,645                                                                       (32,574 )                                                                      (3,280 )                                                                     (55,567 )
Add: Net income (loss) attributable to non-controlling interest                        --                          --                          --                          --  
                                                                                     -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------                      -------------------- -------------- --------------------
          Net income (loss) attributable to Envestnet, Inc.                                             $         17,645                                           $        (32,574 )                                                            $         (3,280 )                                                            $        (55,567 )
                                                                                     ==================== ============== ====================                      ==================== ============== ====================                      ==================== ============== ====================                      ==================== ============== ====================
                                                                                                                                                                                                                                                                                                                                                     
Net income (loss) per share attributable to Envestnet, Inc.:
    Basic                                                                                               $           0.40                                           $          (0.75 )                                                            $          (0.08 )                                                            $          (1.30 )
                                                                                     ==================== ============== ====================                      ==================== ============== ====================                      ==================== ============== ====================                      ==================== ============== ====================
                                                                                                                                                                                                                                                                                                                                                     
    Diluted                                                                                             $           0.38                                           $          (0.75 )                                                            $          (0.08 )                                                            $          (1.30 )
                                                                                     ==================== ============== ====================                      ==================== ============== ====================                      ==================== ============== ====================                      ==================== ============== ====================
                                                                                                                                                                                                                                                                                                                                                     
Weighted average common shares outstanding:
    Basic                                                                                  44,404,104                              43,155,793                              43,732,148                              42,814,222  
                                                                                     ==================== ============== ====================                      ==================== ============== ====================                      ==================== ============== ====================                      ==================== ============== ====================
                                                                                                                                                                                                                                                                                                                                                     
    Diluted                                                                                46,957,681                              43,155,793                              43,732,148                              42,814,222  
                                                                                     ==================== ============== ====================                      ==================== ============== ====================                      ==================== ============== ====================                      ==================== ============== ====================
 
                                                                                                                                                                         Envestnet, Inc.
                                                                                                                                                         Condensed Consolidated Statements of Cash Flows
                                                                                                                                                                         (in thousands)
                                                                                                                                                                           (unaudited)
 
                                                                                                                                                                                                     Year Ended
                                                                                                                                                                                                                       December 31,
                                                                                           ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                                     2017                                                                                                                      2016
                                                                                           ------------------------------------------------------------------------------------------------------------------------                     ------------------------------------------------------------------------------------------------------------------------
OPERATING ACTIVITIES:                                                                                                                                                                                    
Net loss                                                                                                      $                                                                        (3,280 )                                                            $                                                                       (55,567 )
Adjustments to reconcile net loss to net cash provided by operating
activities:
    Depreciation and amortization                                                                                                                                                      62,820                                                                                                                                       63,999
    Deferred rent and lease incentive                                                                                                                                                   1,027                                                                                                                                         (438 )
    Provision for doubtful accounts                                                                                                                                                       867                                                                                                                                        1,122
    Deferred income taxes                                                                                                                                                              (4,597 )                                                                                                                                      5,584
    Stock-based compensation expense                                                                                                                                                   31,331                                                                                                                                       33,276
    Non-cash interest expense                                                                                                                                                           8,994                                                                                                                                        8,244
    Accretion on contingent consideration and purchase liability                                                                                                                          512                                                                                                                                          150
    Fair market value adjustment on contingent consideration                                                                                                                   --                                                                                                                                        1,588
    Impairment of equity method investment                                                                                                                                     --                                                                                                                                          734
    Loss allocation from equity method investment                                                                                                                                       1,469                                                                                                                                        1,420
    Loss on disposal of fixed assets                                                                                                                                                       76                                                                                                                                          398
    Changes in operating assets and liabilities, net of acquisitions:
        Fees and other receivables                                                                                                                                                     (8,121 )                                                                                                                                      1,646
        Prepaid expenses and other current assets                                                                                                                                        (787 )                                                                                                                                     (3,290 )
        Other non-current assets                                                                                                                                                       (1,690 )                                                                                                                                        (98 )
        Accrued expenses and other liabilities                                                                                                                                         16,810                                                                                                                                       17,174
        Accounts payable                                                                                                                                                                 (442 )                                                                                                                                       (462 )
        Deferred revenue                                                                                                                                                                1,191                                                                                                                                        2,014
        Other non-current liabilities                                                                       2,427                                         3,776  
                                                                                           -------------------- -------------------- -------------------- -------------------- -------------- --------------------                      -------------------- -------------------- -------------------- -------------------- -------------- --------------------
Net cash provided by operating activities                                                                 108,607                                        81,270  
                                                                                           -------------------- -------------------- -------------------- -------------------- -------------- --------------------                      -------------------- -------------------- -------------------- -------------------- -------------- --------------------
                                                                                                                                                                                                                                                                                                                             
INVESTING ACTIVITIES:
    Purchase of property and equipment                                                                                                                                                (14,945 )                                                                                                                                    (13,967 )
    Capitalization of internally developed software                                                                                                                                   (12,624 )                                                                                                                                     (8,609 )
    Investment in private company                                                                                                                                                      (1,450 )                                                                                                                                     (2,238 )
    Purchase of ERS units                                                                                                                                                      --                                                                                                                                       (1,500 )
    Acquisition of businesses, net of cash acquired                                                --                                       (31,613 )
                                                                                           -------------------- -------------------- -------------------- -------------------- -------------- --------------------                      -------------------- -------------------- -------------------- -------------------- -------------- --------------------
Net cash used in investing activities                                                                     (29,019 )                                                        (57,927 )
                                                                                           -------------------- -------------------- -------------------- -------------------- -------------- --------------------                      -------------------- -------------------- -------------------- -------------------- -------------- --------------------
                                                                                                                                                                                                                                                                                                                             
FINANCING ACTIVITIES:
    Payment of Term Notes                                                                                                                                                             (35,862 )                                                                                                                                     (8,000 )
    Proceeds from borrowings on revolving credit facility                                                                                                                              35,000                                                                                                                                       40,000
    Payments on revolving credit facility                                                                                                                                             (62,500 )                                                                                                                                    (40,000 )
    Payments of contingent consideration                                                                                                                                               (2,286 )                                                                                                                                     (3,729 )
    Payments of definite consideration                                                                                                                                                   (445 )                                                                                                                             --
    Payments of purchase consideration liabilities                                                                                                                                       (235 )                                                                                                                                     (3,256 )
    Proceeds from exercise of stock options                                                                                                                                             7,951                                                                                                                                        4,924
    Debt issuance costs                                                                                                                                                                   (94 )                                                                                                                             --
    Purchase of treasury stock for stock-based tax withholdings                                                                                                                       (13,974 )                                                                                                                                    (10,966 )
    Common stock acquired under the share repurchase program                                                                                                                   --                                                                                                                                       (1,448 )
    Issuance of restricted stock                                                                                5                                             6  
                                                                                           -------------------- -------------------- -------------------- -------------------- -------------- --------------------                      -------------------- -------------------- -------------------- -------------------- -------------- --------------------
Net cash used in financing activities                                                                     (72,440 )                                                        (22,469 )
                                                                                           -------------------- -------------------- -------------------- -------------------- -------------- --------------------                      -------------------- -------------------- -------------------- -------------------- -------------- --------------------
                                                                                                                                                                                                                                                                                                                             
EFFECT OF EXCHANGE RATE CHANGES ON CASH                                                                                                                                                   375                                                                                                                               --
                                                                                                                                                                                                                                                                                                                             
INCREASE IN CASH AND CASH EQUIVALENTS                                                                       7,523                                           874  
                                                                                           -------------------- -------------------- -------------------- -------------------- -------------- --------------------                      -------------------- -------------------- -------------------- -------------------- -------------- --------------------
                                                                                                                                                                                                                                                                                                                             
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                                                                                                                                         52,592                                                                                                                                       51,718
                                                                                                                                                  
                                                                                           -------------------- -------------------- -------------------- -------------------- ------------------------------------                     -------------------- -------------------- -------------------- -------------------- ------------------------------------
CASH AND CASH EQUIVALENTS, END OF PERIOD                                                                      $               60,115                                           $               52,592  
                                                                                           ==================== ==================== ==================== ==================== ============== ====================                      ==================== ==================== ==================== ==================== ============== ====================
 
                                                                                                                                                                             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,
                                                                                      --------------------------------------------------------------------------------------------------------------------------------------------------- -------------------------------------------------------------------------------------------------------------------------------
                                                                                                              2017                                                   2016                                                                      2017                                                   2016
                                                                                      -----------------------------------------------------                     -----------------------------------------------------                     -----------------------------------------------------                     -----------------------------------------------------
                                                                                                                                                                                                                                                                                                                                          
Total revenues                                                                                           $    182,862                                                              $    155,480                                                              $    683,679                                                              $    578,164
    Deferred revenue fair value adjustment                                                      10                                 489                                 130                               1,270  
                                                                                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
Adjusted revenues                                                                                        $    182,872                                           $    155,969                                           $    683,809                                           $    579,434  
                                                                                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================
                                                                                                                                                                                                                                                                                                                                          
Net income (loss)                                                                                        $     17,645                                                              $    (32,574 )                                                            $     (3,280 )                                                            $    (55,567 )
Add (deduct):
    Deferred revenue fair value adjustment                                                                         10                                                                       489                                                                       130                                                                     1,270
    Interest income                                                                                               (93 )                                                                      (9 )                                                                    (201 )                                                                     (37 )
    Interest expense                                                                                            3,676                                                                     4,255                                                                    16,347                                                                    16,600
    Accretion on contingent consideration and purchase liability                                                  104                                                                         7                                                                       512                                                                       150
    Income tax provision (benefit)                                                                             (9,233 )                                                                  25,679                                                                     1,591                                                                    15,077
    Depreciation and amortization                                                                              16,028                                                                    14,127                                                                    62,820                                                                    63,999
    Non-cash compensation expense                                                                               7,880                                                                     7,528                                                                    31,331                                                                    33,276
    Restructuring charges and transaction costs                                                                 3,431                                                                     1,300                                                                    13,666                                                                     5,784
    Severance                                                                                                      56                                                                     1,238                                                                     2,316                                                                     4,342
    Fair market value adjustment on contingent consideration                                                        -                                                                       750                                                                         -                                                                     1,588
    Litigation related expense                                                                                      -                                                                     1,526                                                                     1,033                                                                     5,591
    Foreign currency and related hedging activity                                                                 198                                                                       (44 )                                                                     494                                                                      (716 )
    Other income                                                                                                    -                                                                    (1,384 )                                                                       -                                                                    (1,384 )
    Non-income tax expense adjustment                                                                          (1,388 )                                                                   6,229                                                                       346                                                                     6,229
    Impairment of equity method investment                                                                          -                                                                       734                                                                         -                                                                       734
    Loss allocation from equity method investment                                                                 485                                                                       290                                                                     1,469                                                                     1,420
    Loss (income) attributable to non-controlling interest                                     (61 )                                                  294                                 316                               1,081  
                                                                                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
Adjusted EBITDA                                                                                          $     38,738                                           $     30,435                                           $    128,890                                           $     99,437  
                                                                                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================
                                                                                                                                                                                                                                                                                                                                          
Net income (loss)                                                                                        $     17,645                                                              $    (32,574 )                                                            $     (3,280 )                                                            $    (55,567 )
Income tax provision (benefit) (1)                                                          (9,233 )                                               25,679                               1,591                              15,077  
                                                                                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
Income (loss) before income tax provision                                                                $      8,412                                                              $     (6,895 )                                                            $     (1,689 )                                                            $    (40,490 )
Add (deduct):
    Deferred revenue fair value adjustment                                                                         10                                                                       489                                                                       130                                                                     1,270
    Accretion on contingent consideration and purchase liability                                                  104                                                                         7                                                                       512                                                                       150
    Non-cash interest expense                                                                                   1,210                                                                     2,174                                                                     8,994                                                                     8,244
    Non-cash compensation expense                                                                               7,880                                                                     7,528                                                                    31,331                                                                    33,276
    Restructuring charges and transaction costs                                                                 3,431                                                                     1,300                                                                    13,666                                                                     5,784
    Severance                                                                                                      56                                                                     1,238                                                                     2,316                                                                     4,342
    Amortization of acquired intangibles                                                                       10,794                                                                     9,359                                                                    42,127                                                                    45,515
    Fair market value adjustment on contingent consideration                                                        -                                                                       750                                                                         -                                                                     1,588
    Litigation related expense                                                                                      -                                                                     1,526                                                                     1,033                                                                     5,591
    Foreign currency and related hedging activity                                                                 198                                                                       (44 )                                                                     494                                                                      (716 )
    Other income                                                                                                    -                                                                    (1,384 )                                                                       -                                                                    (1,384 )
    Non-income tax expense adjustment                                                                          (1,388 )                                                                   6,229                                                                       346                                                                     6,229
    Impairment of equity method investment                                                                          -                                                                       734                                                                         -                                                                       734
    Loss allocation from equity method investment                                                                 485                                                                       290                                                                     1,469                                                                     1,420
    Loss (income) attributable to non-controlling interest                                     (61 )                                                  294                                 316                               1,081  
                                                                                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
Adjusted net income before income tax effect                                                                   31,131                                                                    23,595                                                                   101,045                                                                    72,634
Income tax effect (2)                                                                      (12,452 )                                               (9,438 )                                              (40,418 )                                              (29,054 )
                                                                                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
Adjusted net income                                                                                      $     18,679                                           $     14,157                                           $     60,627                                           $     43,580  
                                                                                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================
                                                                                                                                                                                                                                                                                                                                          
Basic number of weighted-average shares outstanding                                                        44,404,104                                                                43,155,793                                                                43,732,148                                                                42,814,222
Effect of dilutive shares:
    Options to purchase common stock                                                                        1,596,965                                                                 1,206,908                                                                 1,649,225                                                                 1,278,827
    Unvested restricted stock units                                                        956,612                             478,820                             770,428                             486,823  
                                                                                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------                      -------------------- ---------- --------------------
Diluted number of weighted-average shares outstanding                                   46,957,681                          44,841,521                          46,151,801                          44,579,872  
                                                                                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================
                                                                                                                                                                                                                                                                                                                                          
Adjusted net income per share - diluted                                                                  $       0.40                                           $       0.32                                           $       1.31                                           $       0.98  
                                                                                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================                      ==================== ========== ====================

____________________ (1) For the three months ended December 31, 2017 and 2016, the effective tax rate computed in accordance with US GAAP equaled (109.8%) and (372.4%), respectively. For the year ended December 31, 2017 and 2016, the effective tax rate computed in accordance with US GAAP equaled (94.2%) and (37.2%), respectively. (2) For 2017, 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)
 
                                                                                                                                                                                                          Three Months Ended December 31, 2017
                                                                                      ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                     Envestnet                                                Envestnet | Yodlee                                      Nonsegment                                                         Total
                                                                                      -----------------------------------------------------------------------                     -------------------------------------------------                     --------------------------------------------------                     --------------------------------------------------------------------------
                                                                                                                                                                                                                                                                                                                                  
Total revenues                                                                                           $                      141,267                                                              $ 41,595                                                              $       -                                                              $                         182,862
    Deferred revenue fair value adjustment                                                      2                               8                                -                                    10  
                                                                                      -------------------- -------------------- ------- --------------------                      -------------------- ------ --------------------                      -------------------- ------- --------------------                      -------------------- -------------------- ---------- --------------------
Adjusted revenues                                                                                        $   141,269                                           $ 41,603                                           $       -                                           $      182,872  
                                                                                      ==================== ==================== ======= ====================                      ==================== ====== ====================                      ==================== ======= ====================                      ==================== ==================== ========== ====================
                                                                                                                                                                                                                                                                                                                                                                          
Income (loss) from operations                                                                            $                       27,172                                                              $ (2,749 )                                                            $ (11,740 )                                                            $                          12,683
Add (deduct):
    Deferred revenue fair value adjustment                                                                                            2                                                                     8                                                                      -                                                                                             10
    Accretion on contingent consideration and purchase liability                                                                    104                                                                     -                                                                      -                                                                                            104
    Depreciation and amortization                                                                                                 7,027                                                                 9,001                                                                      -                                                                                         16,028
    Non-cash compensation expense                                                                                                 3,620                                                                 2,743                                                                  1,517                                                                                          7,880
    Restructuring charges and transaction costs                                                                                    (402 )                                                                   -                                                                  3,828                                                                                          3,426
    Non-income tax expense adjustment                                                                                            (1,388 )                                                                   -                                                                      -                                                                                         (1,388 )
    Severance                                                                                                                        12                                                                    44                                                                      -                                                                                             56
    Gain attributable to non-controlling interest                                             (61 )                                                -                                -                                   (61 )
                                                                                      -------------------- -------------------- ------- --------------------                      -------------------- ------ --------------------                      -------------------- ------- --------------------                      -------------------- -------------------- ---------- --------------------
Adjusted EBITDA                                                                                          $    36,086                                           $  9,047                                           $  (6,395 )                                                            $       38,738  
                                                                                      ==================== ==================== ======= ====================                      ==================== ====== ====================                      ==================== ======= ====================                      ==================== ==================== ========== ====================
 
                                                                                                                                                                                                                             Three Months Ended December 31, 2016
                                                                                      ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                     Envestnet                                                                   Envestnet | Yodlee                                                         Nonsegment                                                                            Total
                                                                                      -----------------------------------------------------------------------                     -------------------------------------------------                     --------------------------------------------------                     --------------------------------------------------------------------------
                                                                                                                                                                                                                                                                                                                                                                          
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 and purchase liability                                                                      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  
                                                                                      ==================== ==================== ======= ====================                      ==================== ====== ====================                      ==================== ======= ====================                      ==================== ==================== ========== ====================
 
                                                                                                                                                                                              Envestnet, Inc.
                                                                                                                                                                               Reconciliation of Non-GAAP Financial Measures
                                                                                                                                                                                            Segment Information
                                                                                                                                                                                              (in thousands)
                                                                                                                                                                                                (unaudited)
 
                                                                                                                                                                                                           For the Year Ended December 31, 2017
                                                                                      ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                     Envestnet                                                 Envestnet | Yodlee                                      Nonsegment                                                         Total
                                                                                      -----------------------------------------------------------------------                     --------------------------------------------------                     --------------------------------------------------                     --------------------------------------------------------------------------
                                                                                                                                                                                                                                                                                                                                   
Total revenues                                                                                           $                      527,905                                           $ 155,774                                                              $       -                                                              $                         683,679
    Deferred revenue fair value adjustment                                                     38                               92                                -                                   130  
                                                                                      -------------------- -------------------- ------- --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------                      -------------------- -------------------- ---------- --------------------
Adjusted revenues                                                                                        $   527,943                                           $ 155,866                                           $       -                                           $      683,809  
                                                                                      ==================== ==================== ======= ====================                      ==================== ======= ====================                      ==================== ======= ====================                      ==================== ==================== ========== ====================
                                                                                                                                                                                                                                                                                                                                                                           
Income (loss) from operations                                                                            $                       75,449                                                              $ (19,456 )                                                            $ (39,573 )                                                            $                          16,420
Add (deduct):
    Deferred revenue fair value adjustment                                                                                           38                                                                     92                                                                      -                                                                                            130
    Accretion on contingent consideration and purchase liability                                                                    512                                                                      -                                                                      -                                                                                            512
    Depreciation and amortization                                                                                                26,223                                                                 36,597                                                                      -                                                                                         62,820
    Non-cash compensation expense                                                                                                15,191                                                                 10,880                                                                  5,260                                                                                         31,331
    Restructuring charges and transaction costs                                                                                     366                                                                      -                                                                 13,300                                                                                         13,666
    Non-income tax expense adjustment                                                                                               346                                                                      -                                                                      -                                                                                            346
    Severance                                                                                                                     1,954                                                                    346                                                                     16                                                                                          2,316
    Litigation related expense                                                                                                        -                                                                  1,033                                                                      -                                                                                          1,033
    Loss attributable to non-controlling interest                                             316                                -                                -                                   316  
                                                                                      -------------------- -------------------- ------- --------------------                      -------------------- ------- --------------------                      -------------------- ------- --------------------                      -------------------- -------------------- ---------- --------------------
Adjusted EBITDA                                                                                          $   120,395                                           $  29,492                                           $ (20,997 )                                                            $      128,890  
                                                                                      ==================== ==================== ======= ====================                      ==================== ======= ====================                      ==================== ======= ====================                      ==================== ==================== ========== ====================
                                                                                                                                                                                                                                                                                                                                                                           
                                                                                                                                                                                                                              For the Year Ended December 31, 2016
                                                                                      ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                     Envestnet                                                                    Envestnet | Yodlee                                                         Nonsegment                                                                            Total
                                                                                      -----------------------------------------------------------------------                     --------------------------------------------------                     --------------------------------------------------                     --------------------------------------------------------------------------
                                                                                                                                                                                                                                                                                                                                                                           
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 and purchase liability                                                                    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  
                                                                                      ==================== ==================== ======= ====================                      ==================== ======= ====================                      ==================== ======= ====================                      ==================== ==================== ========== ====================
 
                                                                                                                                              Envestnet, Inc.
                                                                                                                                 Historical Assets, Accounts and Advisors
                                                                                                                                (in millions, except accounts and advisors)
                                                                                                                                                (unaudited)
 
                                                                                                                                                             As of
                                                           ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                    December 31,                                                                                       September 30,                    December 31,
                                                                        2016                        March 31, 2017                    June 30, 2017                        2017                             2017
                                                           -----------------------------  -------------------- -----------------------------  -------------------- -----------------------------  -------------------- -----------------------------  -------------------- -----------------------------
                                                                                                                                                           (in millions except accounts and advisors data)
Platform Assets
    Assets Under Management (AUM)                                             $   105,178                                         $   113,544                                         $   122,543                                         $   131,809                                         $   141,518
    Assets Under Administration (AUA)                          241,682       248,445       271,450       293,963       308,480
                                                           -------------------- --------- -------------------- -------------------- --------- -------------------- -------------------- --------- -------------------- -------------------- --------- -------------------- -------------------- ---------
        Subtotal AUM/A                                                            346,860                                             361,989                                             393,993                                             425,772                                             449,998
    Subscription and Licensing                                 748,125       763,372       825,829       867,967       926,880
                                                           -------------------- --------- -------------------- -------------------- --------- -------------------- -------------------- --------- -------------------- -------------------- --------- -------------------- -------------------- ---------
Total Platform Assets                                                         $ 1,094,985                      $ 1,125,361                      $ 1,219,822                      $ 1,293,739                      $ 1,376,878
                                                           ==================== ========= ==================== ==================== ========= ==================== ==================== ========= ==================== ==================== ========= ==================== ==================== =========
Platform Accounts
    AUM                                                                           545,130                                             574,132                                             614,973                                             652,060                                             685,925
    AUA                                                        994,583       986,554     1,083,417     1,145,050     1,217,697
                                                           -------------------- --------- -------------------- -------------------- --------- -------------------- -------------------- --------- -------------------- -------------------- --------- -------------------- -------------------- ---------
        Subtotal AUM/A                                                          1,539,713                                           1,560,686                                           1,698,390                                           1,797,110                                           1,903,622
    Subscription and Licensing                               4,558,883     4,263,002     4,811,390     4,925,146     5,027,900
                                                           -------------------- --------- -------------------- -------------------- --------- -------------------- -------------------- --------- -------------------- -------------------- --------- -------------------- -------------------- ---------
Total Platform Accounts                                      6,098,596     5,823,688     6,509,780     6,722,256     6,931,522
                                                           ==================== ========= ==================== ==================== ========= ==================== ==================== ========= ==================== ==================== ========= ==================== ==================== =========
Advisors
    AUM/A                                                                          36,483                                              36,985                                              38,498                                              40,379                                              40,485
    Subscription and Licensing                                  17,852        18,159        19,007        19,104        19,445
                                                           -------------------- --------- -------------------- -------------------- --------- -------------------- -------------------- --------- -------------------- -------------------- --------- -------------------- -------------------- ---------
Total Advisors                                                  54,335        55,144        57,505        59,483        59,930
                                                           ==================== ========= ==================== ==================== ========= ==================== ==================== ========= ==================== ==================== ========= ==================== ==================== =========
 

The following tables summarize the changes in AUM and AUA for the three months ended December 31, 2017:

                                                                                 Gross                         Redemp-                          Net                          Market            
In Millions Except Accounts                                       9/30/2017                                            Sales                                             tions                                             Flows                                            Impact                                                12/31/2017
---------------------------------                      -----------------------------                       --------------------------                       ----------------------------                       ---------------------------                       --------------------------                       ----------------------------------------
                                                                                                                                                                                                                                                                                                                                        
Assets under Management (AUM)                                             $   131,809                                         $ 14,218                                         $  (8,987)                                         $   5,231                                         $  4,478                                         $              141,518
Assets under Administration (AUA)                          293,963                        47,609                        (43,982)                          3,627                        10,890                                     308,480
                                                       -------------------- ---------                      -------------------- ------                      -------------------- --------                      -------------------- -------                      -------------------- ------                      -------------------- --------------------
    Total AUM/A                                                           $   425,772                                         $ 61,827                                         $ (52,969)                                         $   8,858                                         $ 15,368                                         $              449,998
                                                       ==================== =========                      ==================== ======                      ==================== ========                      ==================== =======                      ==================== ======                      ==================== ====================
                                                                                                                                                                                                                                                                                                                                        
Fee-Based Accounts                                                          1,797,110                                                                                                                                               106,512                                                                                                       1,903,622
 

The above AUM/A gross sales figures include $28.7 billion in new client conversions. The Company onboarded an additional $22.4 billion in subscription and licensing conversions during the fourth quarter, bringing total conversions for the quarter to $51.1 billion.

The following tables summarize the changes in AUM and AUA for the year ended December 31, 2017:

                                                                                                                                                                                                           Reclass (to)          
                                                                                                                       Gross                                             Redemp-                                              Net                                             Market                                             from
In Millions Except Accounts                                      12/31/2016                                            Sales                                              tions                                              Flows                                            Impact                                           Licensing                                               12/31/2017
---------------------------------                      -----------------------------                       ---------------------------                       -----------------------------                       ---------------------------                       --------------------------                       ----------------------------                       ----------------------------------------
                                                                                                                                                                                                                                                                                                                                                                                             
Assets under Management (AUM)                                             $   105,178                                         $  50,331                                         $  (28,876)                                         $  21,455                                         $ 14,885                                         $        -                                         $              141,518
Assets under Administration (AUA)                          241,682                        121,653                         (84,240)                         37,413                        34,276                         (4,891)                                     308,480
                                                       -------------------- ---------                      -------------------- -------                      -------------------- ---------                      -------------------- -------                      -------------------- ------                      -------------------- --------                      -------------------- --------------------
    Total AUM/A                                                           $   346,860                                         $ 171,984                                         $ (113,116)                                         $  58,868                                         $ 49,161                                         $  (4,891)                                         $              449,998
                                                       ==================== =========                      ==================== =======                      ==================== =========                      ==================== =======                      ==================== ======                      ==================== ========                      ==================== ====================
                                                                                                                                                                                                                                                                                                                                                                                             
Fee-Based Accounts                                                          1,539,713                                                                                                                                                 386,673                                                                                            (22,764)                                                      1,903,622
 

The above AUM/A gross sales figures include $49.6 billion in new client conversions. The Company onboarded an additional $57.1 billion in subscription and licensing conversions during 2017, bringing total conversions for the year to $106.7 billion.

http://cts.businesswire.com/ct/CT?id=bwnews&sty=20180222006469r1&sid=cmtx6&distro=nx&lang=en

View source version on businesswire.com: http://www.businesswire.com/news/home/20180222006469/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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