Blackstone Inc (BX) Q1 2025 Earnings Call Highlights: Record Inflows and AUM Amid Market Challenges

Yahoo

18-04-2025

GAAP Net Income: $1.2 billion for the first quarter.
Distributable Earnings: $1.4 billion, or $1.09 per common share.
Dividend Declared: $0.93 per common share.
Fee-Related Earnings Growth: 9% year-over-year.
Assets Under Management (AUM): Increased 10% year-over-year to nearly $1.2 trillion.
Inflows: $62 billion in Q1, highest level in three years.
Management Fees: Increased 11% to a record $1.9 billion in Q1.
Net Realizations Increase: 22% year-over-year.
Performance Revenue Eligible AUM: Reached a record $583 billion, up 13% year-over-year.
Infrastructure Appreciation: 7.5% in the quarter and 24% for the last 12 months.
Corporate Private Equity Funds Appreciation: 1.1% in the quarter and 14% for the last 12 months.
Non-Investment Grade Private Credit Strategies Return: 2.7% in the quarter and 15% for the last 12 months.
Core Plus Real Estate Funds Appreciation: 1.2% in the first quarter.
Warning! GuruFocus has detected 6 Warning Signs with BX.
Release Date: April 17, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Blackstone Inc (NYSE:BX) reported strong first-quarter results with distributable earnings up 11% year-over-year to $1.4 billion.
The company raised $62 billion in inflows in Q1, the highest level in three years, contributing to a record $1.2 trillion in assets under management.
Blackstone's private credit business has expanded significantly, with $465 billion in assets, driven by strong performance and structural tailwinds.
The firm's private wealth platform continues to grow, with $270 billion in assets, and new strategic alliances with Wellington and Vanguard aim to democratize private markets.
Blackstone's infrastructure platform saw a 36% year-over-year increase in assets under management, with strong performance in data centers and other areas.
Uncertainty around tariffs and their potential impact on economic growth and inflation poses risks to investor sentiment and market conditions.
Realization activity is expected to be affected by policy-driven uncertainty and market volatility, potentially impacting near-term earnings.
The direct first-order exposure to tariffs is limited, but there are potential material impacts on a small group of portfolio companies.
The IPO market is currently challenging, with conditions being the toughest among capital markets, affecting potential exits.
The North American institutional channel faces fundraising headwinds due to continued realization challenges and a mature market environment.
Q: Can you discuss the deployment opportunity with nearly $180 billion of dry powder, given the current uncertain and volatile environment? A: Jonathan Gray, President and COO, explained that during periods of dislocation, Blackstone accelerates deployment in areas where security values have decoupled due to technical factors. They are looking at public companies and sectors with long-term conviction, such as digital infrastructure and energy. The firm is well-positioned to take advantage of opportunities with $177 billion of dry powder.
Q: Why do private market solutions work well in all environments, and how does Blackstone emerge stronger from periods of volatility? A: Jonathan Gray highlighted that Blackstone's model is designed for stress periods, with almost no net debt and $177 billion of dry powder. This allows them to be counter-cyclical, leaning in when prices drop. The long-term nature of their investments and the ability to hold assets without being forced sellers contribute to their resilience and strength.
Q: What is your outlook for fundraising in the North American institutional channel, given continued realization headwinds? A: Jonathan Gray noted that while decision-making may slow due to the environment, North American clients remain committed to private assets. Certain segments like secondaries, infrastructure, and credit are in favor. The overall bias is towards more alternatives, driven by strong returns.
Q: Can you comment on the opportunity to expand the global wealth management business, particularly with the Wellington and Vanguard partnership? A: Jonathan Gray emphasized the significant growth potential in the wealth area, with Blackstone's strong brand and history in private wealth. The partnership with Wellington and Vanguard aims to create holistic solutions for individual investors, enhancing access to private market solutions.
Q: How do you assess the direct impact of tariffs on your portfolio, and how is your direct lending business holding up? A: Jonathan Gray stated that the direct impact of tariffs is limited to a small group of companies affected by supply chain costs. The broader impact depends on market volatility and economic slowdown. The direct lending business is resilient, with lower leverage compared to past cycles, and is expected to withstand potential stresses.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.