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Practice profit on upward trend

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18 June 2026 by Jason Spits, SMS Magazine

Article link: https://smsmagazine.com.au/news/2026/06/18/practice-profit-on-upward-trend/

Financial advice practices that have withstood the wave of regulatory and education reforms of the past decade are now more profitable while operating in a profession heavily reduced in size, according to new data from Adviser Ratings.

In its “2026 Australian Financial Advice Landscape Report”, the financial advice sector data and intelligence firm found average practice revenue had climbed to $674,000, an increase of 40 per cent since 2023, and average net profit margin had reached 23.3 per cent, a rise of 3.6 per cent over the same period.

The figures, drawn from a survey of 1352 advisers and 503 practices, showed practices earning more than $1.5 million in revenue had risen to 28 per cent, up from 17 per cent in 2023, while the proportion producing no profit had almost halved from 17.7 per cent to 9.4 per cent.

Adviser Ratings pointed out the improvements were not restricted to the top end of the spectrum and 70 per cent of practices grew their margin by more than 10 per cent over the past year compared with 59 per cent in 2025, and 36 per cent now operate above a 30 per cent margin compared to 28 per cent last year.

The report noted the increase in profitability has taken place at the end of a period of contraction and when all legacy education and experience pathways ended on 1 January 2026, there were around 15,100 advisers registered with the Australian Securities and Investments Commission, a decrease of 46 per cent from the 2018 peak of around 27,900.

“As supply has tightened, the price of advice has risen sharply: the median ongoing fee is now $4837, up 93 per cent since 2019. The result is a market of rarer, more valuable advice relationships, with around 1.92 million Australians now advised and median funds under advice of $755,000 per client,” the firm stated.

Commenting on figures that 62 per cent of practices planned to grow their adviser numbers and only 3.9 per cent of practitioners intended to exit the sector, Adviser Ratings managing director Angus Woods added: “The advisers who stayed through reform are now scaling, and it shows in the numbers.

“Revenue is up 40 per cent, margins are at a record and almost nobody is planning to leave – exit intent is the lowest we’ve recorded since [the] FASEA (Financial Adviser Standards and Ethics Authority) [changes]. This is a profession that has moved from survival to confidence.”

 

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