By lying low in the second quarter — cutting administrative costs, paring its ad budget, and making minimal marketing moves — T. Rowe Price Group Inc. managed to be more profitable than most analysts had expected.

And given investors’ lukewarm appetite for financial products thus far this year, containment may remain the strategy of choice for T. Rowe Price — and for the fund industry at large — at least into the third quarter.

Analysts had expected the company to earn 31 to 40 cents a share, according to Thomson Financial/First Call. On Friday, T. Rowe reported earnings of $51.2 million, or 40 cents a share, on revenues of $262.1 million.

In an interview Friday, George A. Roche, chairman and president of the Baltimore mutual fund company, said that until investors show stronger interest in fund products, he plans to keep all costs under control. For example, he said, the company does not plan to start many funds anytime soon. Beyond that, he declined to elaborate on cost-containment plans.

T. Rowe’s second-quarter operating expenses fell 11.5% from the previous quarter, to $175.3 million. Some of the cuts came from employee attrition — a spokesman for the company said it laid off about 55 shareholder service employees in April and has significantly reduced its use of outside consultants.

In addition, the company’s spending on advertising dropped 27.8% from the previous quarter and 26% from a year earlier, to $15.6 million.

The per-share earnings — which rose 2 cents from the previous quarter, but fell 14 cents from the same period last year — were generated in part by growth in assets under management but largely by the cost-cutting.

Assets under management dropped 11.4% from a year earlier, but grew 0.6% from the first quarter, to $158.6 billion.

T. Rowe also benefited in the second quarter from the changing preferences of the investing public, which became more interested in investing in value companies than in growth companies during the past year, according to analysts.

In the quarter, investors bought $144 million of T. Rowe’s funds, mostly equity funds. Mark Constant, an analyst at Lehman Brothers in San Francisco, said the sales total was larger than he had expected.

Mr. Roche also would not elaborate on whether his company would further cut in its advertising budget, except to say that as long as investors continue to be cautious, advertising expenditures this year will probably remain lower than last year.

Still, he said that he believes the market bottomed out in April, and that investors will slowly regain their enthusiasm for mutual funds over time.

And in a report published Friday, Richard Strauss, an analyst at Goldman Sachs Group Inc., wrote that he believes T. Rowe’s ad spending may creep back up to $20 million by the fourth quarter.

However, analysts say that to achieve stronger near-term growth, T. Rowe cannot follow its cost containment strategy forever — it will have to expand its distribution and explore other channels.

Mr. Constant said the company will have to emphasize its new distribution outlets, which include a class of fund shares sold through financial advisers, and its overseas expansion.

In the past T. Rowe focused on its large no-load, 401(k), and third-party marketing business. Last year it launched a class of shares within its funds specifically for independent financial advisers and stock brokers.

Mr. Roche said the company still plans to expand the number of funds with shares in that class, but he does not intend to put additional emphasis on that business at the expense of its other business lines.

He also said the company hopes to expand overseas through its retail and institutional arm, T. Rowe Price International Inc., which is based in the United Kingdom.

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