Princeton endowment at all time high after 24 percent returns

Princeton’s endowment has reached an all-time high of $42.3 billion after a 23.7 percent investment gain for the 2026 fiscal year that ended June 30. This percentage increase marks the highest investment gain since 2021, which saw 46.9 percent returns driven by venture capital and private equity.

This follows several months of budget cuts across the University after expected long-term returns on the endowment were reduced from 10.2 percent to 8 percent. In his 2026 “State of the University” letter, President of the University Christopher Eisgruber ’83 emphasized that the University has experienced declining long-term rates of return, calling for a transition “from growth to focus.”

This is the second-highest investment gain since at least 2007, with 2021 seeing a 46.9 percentage point increase.

“We might be too pessimistic, but it is also possible that we are being too optimistic,” Eisgruber wrote in February. Though this year’s returns are significantly above the 8 percent assumption, he emphasized in his letter that he was focused on long-term projected returns, rather than any one year, and included graphs displaying general declines in returns over several decades when viewed by 10- and 20-year rolling averages.

Nonetheless, standing at $42.3 billion in value, the latest numbers bring the endowment to an all-time high. After the 2021 fiscal year, the endowment’s value stood at $37.7 billion. Since then, investment gains have plateaued, with losses in 2022 and 2023 leading to total values of $35.8 billion and $34.1 billion, respectively.

The endowment grew by nearly $6 billion with an increase in investment gains of over 12 percent since last year. Between the 2024 and 2025 fiscal years, there was a 7.1 percent increase in gains.

According to University spokesperson Michael Hotchkiss, the endowment’s annualized returns for the past 5, 10 and 20 years are 6.7 percent, 11.3 percent, and 9.7 percent, respectively.

“The endowment continues to provide a crucial financial foundation for the University’s pursuit of its research and teaching mission, allowing Princeton researchers to tackle the world’s toughest problems and its students to receive a transformative education supported by robust financial aid,” Hotchkiss wrote.

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The University’s endowment is particularly essential for the student financial aid program, contributing to over 50 percent of aid given. This program supports around 70 percent of Princeton’s undergraduates and almost all of its graduate students.

The Princeton University Investment Company (PRINCO), which manages the University endowment, has generally aligned its asset allocations with domestic and international stocks as well as illiquid alternatives, including private equity and venture capital.

Only three other Ivy League schools have released their endowment returns for this fiscal year as of publication, but all three have reported high returns: Brown generated 19.6 percent, Harvard 27.1 percent, and the University of Pennsylvania 27.4 percent. These peer institutions cite a robust stock market, venture capital investments, and AI and private technology companies, such as SpaceX, as reasons for this year’s strong endowment performance.

The increased gains also come amid rising threats to higher education from the federal government, including federal endowment taxes. Princeton, however, avoided an estimated $180 million annual federal endowment tax after expanding its financial aid program by $44 million to drop below the threshold of 3,000 tuition-paying students.

“Our planning assumption for the long-term rate of return remains at 8%,” Hotchkiss noted. “As a result, the University continues to be on a multiyear path to a more sustainable budget that requires careful planning and thoughtful financial choices.”

Haeon Lee is the associate News editor for the ‘Prince’ leading research coverage. She is from Brooklyn, N.Y. and often covers campus research and academic departments. She can be reached at hlee[at]dailyprincetonian.com.