Hub24 (ASX:HUB) Surges 14%: The Platform Stocks Winning Australia's Wealth Shift

Hub24 (ASX: HUB) jumped 14% on 19 February after delivering a half-year result that beat expectations across every key metric. Profit surged 60%, the company posted record inflows of A$10.7 billion, and management upgraded its FY27 funds target. Days earlier, Netwealth (ASX: NWL) rallied 12% on its own strong result. This is not just about two companies having a good reporting season. Something structural is reshaping Australian wealth management, and platform stocks sit at the centre of it.

The Structural Shift Away From Legacy Platforms

For years, most adviser-managed money in Australia sat on large legacy platforms run by names like AMP and IOOF. That era is fading. Financial advisers are increasingly choosing modern, technology-driven platforms that offer better reporting, faster execution, and stronger managed account tools.

Hub24 now has over 5,200 advisers using its platform, up 8% on the prior year, with market share climbing to 9.3%. Netwealth grew its adviser network by 7.3% to over 4,000 advisers, pushing its market share to 9.2%. Meanwhile, legacy platforms saw their combined share slip to 54.3%, down from 55.8% a year ago.

One trend accelerating this shift is what the industry calls "platform monogamy." According to Hub24's earnings call, 36% of advisers now prefer consolidating onto a single platform, up from just 13% in 2021. When advisers pick one platform and move their entire book onto it, the winners gain scale quickly, and that is exactly what is happening.

Retirement demographics are adding fuel. As more baby boomers enter the drawdown phase, superannuation member switching is increasing, and advisers are directing those flows toward modern platforms with better tools for managing retirement income.

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What Hub24's Result Tells Us

The numbers speak for themselves. Hub24 posted record platform net inflows of A$10.7 billion, lifted revenue 26% to A$245.9 million, and grew underlying net profit 60% to A$68.3 million.

The real story, though, is the operating leverage. As more funds flow onto the platform, costs do not rise at the same pace. Hub24's EBITDA margin expanded to 42.7%, up 290 basis points, showing the business is scaling efficiently. Total funds under administration reached A$152.3 billion, and management was confident enough to upgrade its FY27 platform FUA target to A$160–170 billion.

The board declared a fully franked interim dividend of 36.0 cents per share, up 50%.

Netwealth's result echoed the same themes: revenue up 24.7% to A$193.8 million, record custodial inflows of A$16.4 billion, and a 20% dividend increase.

What Could Go Wrong

After these share price moves, valuations are stretched. Both Hub24 and Netwealth now trade on premium earnings multiples, which leaves limited room for any disappointment in future results.

Revenue margin compression remains a real risk. Hub24's custody revenue margin held at 32 basis points this half, but as FUA grows and more accounts hit higher pricing tiers or fee caps, that margin faces natural downward pressure. Netwealth noted a similar dynamic, with revenue margins compressing slightly to 31.1 basis points.

Competition is not standing still either. Legacy platforms, including Macquarie Wrap and BT Panorama, are investing heavily in upgrades to win back advisers. And while higher cash rates have boosted platform cash revenue in recent periods, any future rate cuts from the RBA would squeeze that income line.

Key Takeaways

Platform migration is structural, not cyclical. The shift away from legacy systems is driven by adviser preferences, technology capability, and demographic change. This is not a trend that reverses easily.

Hub24 and Netwealth are winning the race. Both companies posted record inflows, growing market share, and improving profitability in 1HFY26, while legacy platforms continue to lose ground.

SMSF trustees should pay attention. Hub24's Class product holds a 30% share of the SMSF administration market, and the platform's managed account tools are increasingly relevant for self-directed super investors. For tailored guidance on navigating platform choices within a self-managed fund, ASR's SMSF Reports provide specialised research for trustees.
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For a broader view of which ASX stocks are positioned to benefit from structural trends like this, download ASR's free Top-3 Stocks & Market Outlook Report.

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