BlackRock (BLK) 12 Apr 242024 Q1 Earnings call transcript

Good morning. My name is Katie, and I will be your conference facilitator today. At this time, I would like to welcome everyone to the BlackRock, Inc.

First Quarter 2024 Earnings Teleconference.

Our host for today's call will be the Chairman and Chief Executive Officer, Laurence D. Martin Officer, Financial Chief S. Fink; S. Small; President, Robert Kapito; and Counsel, Christopher General J. Meade. Instructions]. [Operator you. Thank

you Mr. conference. begin your Meade, may

you. Thank everyone. BlackRock. morning, Good Counsel the of General I'm Chris Meade,

we fact number from of that statements. We course, remind this Before differ attention these we actual forward-looking like to results your course of the call, a the BlackRock's of you make may call I'd begin, that statements. during to may,

that say some may has BlackRock reports the of filed results the was BlackRock from factors -- As differ you know, of result SEC, with the today. cause materially which to what we

BlackRock assumes any does undertake forward-looking to no update duty and statements. not

So with over to I'll it Martin. turn that,

It's Thanks, present pleasure to the XXXX. Chris, morning, results and everyone. my first good for quarter of

it performance to our over review I'll and results. turn financial Larry, Before business I

earnings GAAP discloses primarily our as-adjusted as-adjusted I'll results. both on financial be focusing results. release Our and

client we and outsourced investment nearly ended of engines, and platform. with multiple Momentum's BlackRock's record management across our ahead accelerating, mandates into line sets technology first entire growth of trillion of of private reflect momentum sight and across quarter the quarter sustained strongest opportunity spanning markets. $XX.X technology, solutions a We and results AUM in the and geographies. breadth including have significant channels one

assets and shareholders. growth our grower ability sentiment clients structural our technology. are on world-class ETFs, a grow client private organized in clients, markets across from opportunities model built areas industry to to we're With to and like supportive and both clients for BlackRock's secular energized growth be confident drive of platform behalf through Teams and service. BlackRock optimistic and portfolios profitable execute leadership markets, on deliver these BlackRock to in We more with

$XX of expansion. as alongside earnings to basis of in points positive base driving organic growth continued the First margin double-digit XXX and as fee billion inflows well growth lead industry, net year-over-year quarter long-term revenue

institutional net low-fee billion quarter. index of long-term Excluding saw we the $XXX in inflows equity flows,

in highs broader first out were With market on in As often waiting equity returns markets across long-term cash investing, investors the who timing. the important than quarter, markets. more record powered markets missed time in is to significant

remains XXXX, haven rate rerisking bonds. into nearly in fewer equities XX% an prospect towards the and Although continues clients with the attractive cuts cash to safe the of over last year for propel stocks increase

us, across supportive assets Clients our our BlackRock with clarity They continue consolidate we their the choose units of regions. $X.X growth With growing to base on trust into the channels of momentum performance. a market Organic on which and backdrop, more ago, fee manage behalf ended driving a we and for end quarter rates of premium. quarter, and see the an year broad-based growth our increase more again XX%. from of the up accelerated is portfolios trillion of interest clients, and asset client

softer money flows organic seasonally back quarter, March. the target generated partially annualized growth first billion, coming earlier by net $XX before of in funds. seasonal inflows the In to Total X% of fee outflows institutional from base long-term BlackRock market offset quarter reflected in

higher First the services quarter over on last appreciation XX increased XX% $X.X by technology the AUM of average impact year-over-year, revenue. revenue of driven billion and months fees market performance and

$X.XX of reflecting up nonoperating income. ago, a billion $X.X was higher Operating XX% earnings year was versus XX% of also higher and income per share

capital our unhedged of Nonoperating noncash seed gains included results investments million by for gains, investment $XX the investment in primarily Envestnet. minority and on driven quarter mark-to-market net

vest stock-based in tax quarter quarter compensation benefits that Our related as-adjusted XX% tax and first awards year. of discrete rate for approximately first was the to each the included

tax remainder because tax rate of is estimate or the discrete actual effective run rate XX% legislation. to though for may a projected changes of items potential that or differ in tax continue reasonable nonrecurring the We XXXX,

fee was basis, beta to and the securities our relative equivalent and base was markets, $X.X X.X growth. fees and lending client of annualized lower-fee revenue average X% preferences day basis up compared positive for impact First year-over-year market on U.S. of lower-fee outperformance lower effective rate was of an This securities up fee quarter AUM revenue. by lower lending mainly quarter. count point On equity fourth X% due exposures and to organic the base U.S. billion the sequentially, positive driven

fees a of primarily from reflecting revenue $XXX year ago, Performance million higher alternatives. increased from

demand compared sustained for technology ago, a our to XX% offerings. year revenue Quarterly technology was Aladdin reflecting services up

year-over-year. Annual increased contract ACV value X% or

part Beginning recognized and earnings in ago, a Advisory accounted method investments be minority under the reflecting first of will other as our this presented from results. XXXX, year increased from revenue quarter nonoperating primarily for change. equity of

expense caption. the many line account as sales, direct This and expense. growth, servicing costs, distribution and and addition, with asset account-based includes you and including reported In items expense, revenue general Sub-advisory within new expenses are other expense other which of presentation and fund previously of statement associated asset noncompensation and we expense. know, sub-advisory category updated sales, a and income by was asset variable and administration

costs. generating BlackRock's variable aligning fixed rubric this on and execute represents and expense represents cost which clearer our believe base provides growth of variabilizing our highest we'll of fixed change with scale. investors noncompensation We view spend a It expense more of how conviction financial areas, G&A, investment our more both

sales, X% Total compensation, and year-over-year, and account higher expense increased G&A expense. reflecting asset

higher and Employee was XX%, result fees. income compensation compensation incentive expense higher benefit and primarily up performance of reflecting a as operating

G&A increased marketing XX%, fourth investment technology and spend the in timing expense investment Sequentially, spend technology expense and X% seasonally reflecting year. prior decreased G&A in expense higher of of the timing to promotional the due quarter.

we impacted can within be results expect quarter's G&A. timing spend, of technology of one While areas primary to one of be our by investment

expense. and asset fund year to a increased expense higher Sales, account by driven primarily direct compared X% ago,

due index AUM quarter mainly up the higher current Sequentially, fund the year-over-year, was X% to expense expense AUM. average due index and seasonally higher average Direct in occur higher to fourth in rebates that fund increased quarter. direct

points margin XX.X% up was year from operating basis XXX first quarter ago. of as-adjusted Our a

improve, As committed and result cycles. made direct BlackRock's remain the market a profitable organic investments growth. consistently leverage of is through growth we we've to operating disciplined driving markets industry-leading

continue Looking with prioritize to that growth scale. forward, differentiated organic leverage we'll enhanced investments operating through potential expand or will

head costs, In would line the XXXX expect be XXXX mid-single-digit Partners and increase and to guidance also January flat low in Infrastructure present, expense. count would related and excluding to percentage with of in we our at core we in our impact a broadly expect Global transaction G&A

we At first, efficiency, scale to initiatives growth initiatives. excess and where shareholders strategic support invest either then organic dividends cash return combination inorganic Our may our or operational strategic our a we drive make growth and capital consistent: through times, an repurchases. accelerate investments management we strategy see opportunity share of and remains to to

portfolios. month, via BlackRock's Last strategies announced on builds our Aperio in model separately wealth remaining the minority market. acquire provider This transaction equity personalized U.S. SpiderRock Advisors, and BlackRock's growth we customized on SpiderRock the and option expands agreement in interest accounts overlay made in strong leading in ETF managed in XXXX to of a Advisors investment

we year, to expect quarter present, of conditions. subject closing close customary the this the At in transaction second to

cash issued of consideration GIP. for of we debt planned billion to March, our In fund of $X acquisition a the portion

tranches cost XX- eliminating of XX-year by income the GIP across X invested incremental bond. of rate consisted Our transaction. was well same The maturities. the We and investors, our of carrying the senior offering offering to fixed of unsecured inaugural the prior X-, as currently have at notes especially received XX-year the borrowing, cost close proceeds of effectively substantially additional debt the of offering

transaction, subject closing closing regulatory and to to quarter third the remains other conditions. XXXX We GIP the which for continue target customary the approvals of of

plans based the January We in of anticipate capital repurchased for $XXX quarter market worth and shares for balance year, million quarter. at our to our still present, subject of At $XXX the conditions, consistent common the of we first year guidance. with million repurchasing least per on the spending shares

turn first markets reposition BlackRock their quarter. sentiment Clients into increasingly across from More in redeploy clients portfolios. positive to and the to persisted and

across and of as long-term quarter billion active inflows index $XX as First client were each positive types. well and net product our of strategies

billion inflows with core by offset ETFs. $XX income style seasonal tax by $XX ETF outflows and net U.S. billion, box precision billion of were led ETFs inflows respectively. equity trading-related were our partially and fixed from of $XX net inflows in exposure These

saw billion of As you'll transparency of a demand better to latest in BlackRock exposures. hear launching wider the is January, just of net from Bitcoin investment our $XX the after gathering to inflows and access range quarter. ETC [ in This example provide Larry, ] innovating surging

renewed and demand are model to active portfolios driving $X continued of inflows at growth Aperio income. in as as whole by managed Financial were increasingly Retail led net across well growth fixed billion looking our SMA customize scale, platforms. advisers for

Envestnet last with one the more than partnership to sales our compared portfolios. model platform, powering year-to-date We Our is best growth year. organic flows has this and on and ever gross doubled month saw revenue asset to channel time

Sales they're both in and allocation flows record in models We our accelerating, on saw AUM global components. custom the diversifying. of platform active have models, aren't larger which just similarly gross record

and Advisors wealth our previously SpiderRock across SMAs, segments. greater offerings even our enhance Within mentioned personalization provide further product of acquisition will our

We see LifePath were net active franchise momentum across significant portfolio billion our driven Institutional our target inflows capabilities. of date mandates. by whole outsourcing and $XX

pipeline strong turn Our as outsourcing BlackRock remains solutions. for more clients more to and

outflows index last were concentrated the large significant their net index clients several as amid months. of billion $XX equities appreciation Institutional portfolios low-fee market in equity X in rebalanced

markets net of Our saw private franchise $X billion inflows.

for over of fee clients, equity offerings LP our by in seasoned or private $X primarily alpha offset more for Continued in programs. distributions our and change for fund demand billion liquid solutions basis, monetization generation was reflected

platform market trends. management with of first billion line saw institutional in outflows the money cash BlackRock's quarter, Finally, in net $XX industry

operational as institutional Our in liquid payments. rotations the for purposes, tax these including clients experience seasonal cash withdraw business assets first bonus quarter many and can

redemptions largely open, billion uncommon BlackRock. Balance of market Outflows businesses hand of This markets $XX last balances closed. March to during inflows phenomenon $XX of the management approximately many billion but first April. net redeeming flows financial impacted a are week time not when were by holiday. driven by with Good the Cash money the returned cash ahead unique or in of were are has clients during week the of is on to have net approximately Friday

to with our differentiated driving organic to model has business us BlackRock's margins. grow industry-leading growth enabled continue and clients,

to we with built. opportunity the share structural consolidate position diversified to up trend market our rerisk, markets a more grower to be ourselves as clients our ahead, supportive set we've to Looking that clients. We've expand and and be platform see significant

growing, momentum's is across platform. building Enthusiasm the

clients, our us our of for of All for at shareholders. excited growing future our and for about opportunities are our for BlackRock employees, the and BlackRock, course,

turn With that, to it Larry. over I'll

Thank with that everyone to has Martin. best having some deepening before many conversations you, about accelerating on seen. we monetary with technology, regions portfolio, joining in morning, ever client across channels the client is This navigate relationships is a opportunities we've them. driving this each business staying and in and of Good clients our that you are the Through whole of changes than for pipeline momentum structural their with clients call. breadth models, and focused with all cases, goal. our and every ever strong fiscal secular always policies, connectivity, richer and and partnering BlackRock thank

I'm holistically with But platform the in an clients with more be index. or maybe to differently than durable resonating. investment want providers their to one to public nimble, They conversations their they want about They my in it integrated blending private how past. want just money active hearing customized, and to provider. they work to their technology and text-enabled. BlackRock's world, work. portfolios performance with markets, advisory to around They want do did the want are put they be fewer portfolios In

can is platform only this with the is asset in that the investment results. BlackRock, the technology having around in industry. this to are resonating BlackRock Clients integrated in more choosing way, our manager and the partner do world diverse, and most

trillion seeing BlackRock platform. of entire net AUM $X.X our new Also a BlackRock But has assets. building over record time, more last I'm the ended or at about months. actually at momentum excited up across the billion than entrusted we're XX% new nearly more of with that $XXX the $XX.X first XX BlackRock's quarter trillion,

new are and new in had of large types. ACV We've Momentum BlackRock number active And opportunities. generated a their processes leveraged and significant flows all grew as real number existing technology with Aladdin service a and marquee we positive grow working client to our index clients Aladdin remains of across support and on net as across wins investment entire clients. revenues we platform. and strong and

and by operating year-over-year, per deliver to points. continue were increased XX% technology We we XXX was sustained services BlackRock's and scale. Earnings basis up up XX%. at asset income growth share our margin

Activity accelerating. notably is

flows of As Martin first XX% year's nearly this of year. long-term said, in in which just billion we the long-term represents first net X months generated $XX flows the of quarter, last

And $XXX was which episodic ETFs actually institutional long-term and active the net inflows across activity and mentioned. excludes institutional retail equity Martin billion,

Some large months, a on both quarters, clients breadth will are fund opportunities, over number we've over and public, Aladdin. of But we're of for the these several wealth a that future few some in unique mandate, of including aren't. mandates for conversations been active across broad-based chosen and institutional last regions

amount fund record the approaching trillion. now of on $X are still a money There balances cash sidelines market and is

and I putting retirement BlackRock and on long-dated many are work. how their hard worldwide holding money for it's or from reduce advice how to help to achieve that to but fear objectives and think cash. this and ways, coming in fear to them by uncertainty, deploy capital, Clients where stems that to

about continued very company for XXXX believe for invested beyond. intense asset rest lots the we opportunities I've the I requires investments and Being of themes seen for shareholders BlackRock, I'm has of management. and client these our of and ever into greatest define and BlackRock momentum clients decade a next of innovation, growth the our see optimistic will the focus. ahead

uncertain The the opportunities of opportunities. economic of AI, certain for trends mean great investors and does the across Instead, see is in confidence in opportunities BlackRock emerging connecting a these an include them the rapid accelerated catalysts. near-term to structural a and investing clients globalization, markets long backdrop of in lack we technology rewiring to with number providing not new unprecedented and with These for infrastructure. continually growth run. need advancements

a hubs looking world forms new networks surging increasingly to generation, for infrastructure attractive. becoming of where of are around for power from the longer-duration infrastructure more to clients world returns In and markets data are ways of all for transport the certainty, private more higher-coupon, securing is energy. telecom Demand centers

more and access footprint, our of Over XX to flow. last infrastructure has organic from private distribution markets months, broadly firm's delivered infrastructure benefited and the BlackRock's BlackRock's our platform high-quality the network franchise clients XX% asset and deal global business growth. relationships deep

with As market-leading markets. expertise combination to the we spoke provide GIP in January, access private we across believe will with planned and operating of BlackRock's investments infrastructure infrastructure platform clients

trends. We have BlackRock. another for will history of client needs, long-term will ourselves transformational be this accelerated a combination moment deep in conviction of another positioning ahead our be against planned that example macro It staying

of ETF are approaching I ago. BGI acquisition we of private markets believe did the infrastructure and J-curve nearly announced our years XX just trajectory upward as their iShares when

our new has more led expanding of Since that investing. by ETF like like them asset strategies facilitated iShares, acquisition investment viewed by bonds, market accessible; of in ETFs actives. the technology making delivering a always We classes as BlackRock

indexing of as what result a a is beyond of structure as ETFs range It success, As started concept. that all an the investment evolved efficient solutions. recognized for an

flows ETF billion ] and led largest quarter ETF of quarterly the half were across than net equity in our issuer. month XX% than with March And [ bought flows $XX reflected more activity the core demonstrated ETFs. First inflows categories, for demand next by higher the inflows. accounting sustained client our net of client accelerating

to exposures industry. diverse ETF the of range our innovate in to better our across give to clients continue most the We platform access

fastest January, history $XX was in in has the already nearly fund, growing ETF which Bitcoin was AUM. and in Our billion launched

products $X ETF of drove wrapper. and factor income a ETF BlackRock net with first active equity offer the led Our inflows billion investors These our alpha of more transparent flexible some efficient, in quarter leading in generation rotation our at more by ETFs.

tokenized digital builds continue our continue to product launch to we BlackRock, efficiency. our democratize as that to and Across we increase providing end, a and strategies, and offerings as our last drive the each To cost first our transparency wrappers, investment tokenization clients. month, existing in fund new well all scale of access minority of announced blockchain-based to and And new greater customization platform. access every strategy. products asset Securitize, This on in with the we'll innovate to of aim our

business customization and to increasingly to advisers continue We they anticipation X XX% growth clients serve to that see in turn acquired for and our ago of financial over business acquisition. wealth as organic own SMAs since our this their personalize Aperio years portfolios. has in We trend, demand with been their

To planned announced as our discussed. equity acquisition of SpiderRock, further our interest SMA booster capabilities, in remaining we the Martin

our and also strength demand active for Among strategies particularly wealth unconstrained with fixed income funds. we clients, the renewed seeking are high-yield high-performing in bond

post-QE several and for active returns. X Across In opportunity $XX superior active BlackRock our inflows the of of AUM equity the ahead income, funding XX%, the risk-taking we billion fundamental median equity, delivered institutional fixed peer mandates. Quarterly above management benchmarks net market, systematic franchise, XX% with in reflect see last active years. greater of selective including income generate potential to our or fixed for for more strength durable outsourcing XX% performance and has investment equity taxable systematic fundamental with and

integrated our investment our insights, performance, and Aladdin investment differentiates technology for drives ultimately outcomes Our clients. our BlackRock strong active better

understand management first that. more a Today, enabler, technology. much their We empowering Aladdin better as than risk to investors is built through Aladdin portfolios

resonate platform. Aladdin's Aladdin whole on spanning Our multiple connecting of this quarter integrated our are technology operating leveraging offering partners as the majority single Aladdin classes, asset multiple enterprise to continues system, with products. sales clients a a data,

we executing with ahead with to forward Aladdin clients, several new more the by of existing clients. potential and and benefits We late-stage bringing the on to conversation relationships large clients look be to are in our expanding opportunities Aladdin

days capital to From markets manage are many trillion making and this across we an our developing help assets from client platform, ambition outcome the our More achieve Aladdin of nearly of to the investors than benefit of that conversations. been of to related central the $XX.X the to our has financial seek. half early always now managing futures they growth retirement,

years. solutions BlackRock has advocacy been and for the forefront innovation at of for retirement

called the some automatically was fund the eliminating the pioneered their over we retirement we LifePath revolutionary, for concept, time in of savings guesswork When date target fact, frame. introduced In first XXXX. mix it investment adjusting back by their

years, target become date most contribution States XX option Fast-forward the the where million Americans. default have of plans manage the in United funds we're entrusted to common XX assets in retirement defined investment

we LifePath We to has in need. to Date LifePath participants as That ETFs evolve last introducing and meant such options new year. Target outcome the countries new continue launched retirement help wrappers in LifePath deliver

Our has franchise now billion the in LifePath billion and risen last over assets Target nearly Date years. X $XXX assets has over just $XXX in

for longer expand increasingly spend to addition also help retirement. LifePath throughout helping their we retirement, to people people to save the solution In work

years. focuses a that Society tremendous time a wonderful fraction on helping afford healthier effort people just those and lives, extra amount of on longer them spend helping live and but

spend about Then as how sizable to even this burden in the and have egg, not challenge. which overspend formidable defined The to have retirement, models have not first put or -- to shift build savers. They from at of up not pension itself on savings. retirement and the how nest these large much savings their individual there's a large they guidance is to contribution ask,

Paycheck, a of solutions. this an we for challenge, expected help in the It this been from the income next the go and insurers generation XXXX, In by month. is increase end the option and America. date years purchase announced we target include to stream de-accumulation We've lifetime to of selected will hope to BlackRock working towards LifePath address believe live will

with implementing million participants. target in $XX XX planned X.X are representing sponsors, We now over have billion right on Paycheck now date partnering and AUM LifePath

will stream We the paycheck I predictable most used to a in with a in will one pension. plans. similar contribution XXX(k) the pair for be a life strategy of investment day investment income flexibility potential defined it believe a

of were back structure This security, retirement improve millions and help for the who for and those bring gaps retiring. can pioneering funding address of hope retirement quality life global Americans in

BlackRock. upheavals. to It's of the been start of leaders for hope pandemic all companies we're That's since their the of for need Leaders X stakeholders. the certainly the at countries, years geopolitical of create what and future subsequent doing

I've today, we fear in about is polarization the increasingly some the political world. stoked by spoken before see

in BlackRock United of Our this leader. have States. We with political been subject industry dialogue, of a the the recognize industry mostly some and being

so by job on not of politicization We have that our telling done now lies make or decisions can people based not story and a others. on on better facts, misinformation

long-term who there Unfortunately, there are putting They lie about still others above put these responsibilities. who issues. politics, issues short-term out fiduciary those continuously the are

fiduciary, a dialogue fiduciary in should clients, believe all flows, performance I politics our of in it our it shareholders as know As and our you long-term the them majority never I resonating. of our vast outweigh We and see our see in it that heard do we flows. are with approach performance. with and

over is total where inflows and the It every the environment flows, the last client entrusted led in an negative nearly flat is has years, saw periods. This quarter true inflows, -- years first been and with is or $XXX trillion also the year. has States billion all last in trillion aggregate of It past $X.X Over inflows. $X one X clients United industry where BlackRock net last of in these the this year. have in of the of BlackRock experienced X

better our clients and power We're of our to them, meet BlackRock differentiating delivering dedication all for outcomes all providing them shareholders. we're our each firm, growth their helping of trust unlock the individual our our you, for which us and client integrated then Across a And the to for and providing entails each sustained are possible every new growth clients' people. needs. by the of platform made accelerating opportunities. client Our differentiated shareholders growth, BlackRock's every drive the momentum and has and BlackRock enabled

at believe opportunity be to of has I stronger. base on opportunities products a been delivering The of look stronger. been responsible never world, forward And this the has our BlackRock momentum time, have of front to in I that significant and we never at us every across our all responsibilities we fiduciary across across delivering the broad each platform, and provide client. our

let's it questions. open Operator, up for

Instructions] with first [Operator Bank America. of go to Craig Siegenthaler We'll

question of on your fundings. So my sight is commentary around into building momentum line significant and

So if base we beta, growth? you exclude can divergent like to do back organic when fee rate issues BlackRock get fee X%

trillion law the size? achievable a with And is of at that what numbers objective confidence $XX your large this your factor, current still is AUM

Martin?

Thanks, durable Craig. on flows start income. growth we ETFs, a Martin. active, fixed look, retail, in We billion. Listen, And across granular solid net that I'd flows by more were institutional QX $XX about mix. at see institutional $XXX just like It's billion had

the billion cash of from some billion $XX away Good Friday dynamic index in $XX with equities. redemptions saw and the we course, rebalanced quarter-end these Of institutional

know institutional happen revenue time You the index long-term equities kind rate impacts they detractors, weigh meaningful those fee not flow totals. They're or to time. of from on but

we're excluding for an billion. at with It's grow right momentum look $XXX on core affirmation on things index the trajectory. that us episodic healthy flows QX the It's clients. redemptions, to we this flows, were When focused a

we've a like turned And corner. management fees, really we on base here, the feel team

November had March about the really fees talked to of higher really since annualized X on excellent last we They're target. call. see We start. closed after the new XXXX. and end a base growth. at last quarter, December fourth best we which organic some the of this target fee solid momentum than in quarters, out quarter, the we the slower And We trends finish Over saw

but the up plus line, growth halfway targets. So over trending last more not base or ticking our to we we're moving halfway and It's X target. a long-term organic to see months, fee straight

$X us. this of say these velocity bucket. flows growers active of we see flows I that rates are really trends posted $X retail basis in XX point fee fixed Retail positive good in income, billion. XX $XX critical is billion for going and at see Money back in and to of billion key work, sort to base We And with in momentum overall redemption moderating. institutional active excellent in particular, because

And I think we've supporting fund for selected investment and a and what will breadth organic across see over at, we growth been future Larry X% management technology mandates is quarters. getting of that

planned us GIP build and help there. will Our from acquisition bump of

So we executing mandates forward you keeping look on to on transaction, posted closing guys that progress. and our these

big the conversations Asia, the I right had clients mandates, large Middle The Kapito breadth opportunities, East. conversations in type is worldwide. having These we're would just with just add, now Rob U.K., in we we of Europe, of in the large there. opportunities. are opportunities very see

the those be going bigger products. is going then differentiated are more clients need the to opportunities. data the and seeking of all this the AI And to And if and importantly, power infrastructure deliver for more then lead and proprietary you going all more build-out the who and power centers organizations opportunities overlay the you what promise is of need overlay And can to much for to extraordinary. do related with to be

Michael with to go Stanley. Morgan We'll next Cyprys

expansion. Just talk margin spend wanted to balancing we've In ask the about heard about with past, BlackRock being investment margin-aware.

So evolved. environment? in just how curious has thinking the mean that What does that on today's

time? do that? some levers might margin you How expansion achieve of how for quantify you see opportunity And over to the the

Mike. Thanks,

it's execute a to it's in and management a approach premium leverage creation capital strategy. obviously drive differentiated generate margin shareholder to organic growth, to on consistent operating to Our value is

a over track want emphasize, I expanding from growth. of making growth profitability. We our continued in and to it's long business. term. about It's comes investing profitable And have not strong our in and growth that record just And business for investments growth scale about the

especially scale, other talked the of most we've calls where last size more the we looking variabilize our can. goal. on investments lens to line cost a our in we've aiming in and is and XX our to base I've in lot fixed margins, investments margin We're flexibility through of to a operating put growth looking we're X potential. And the with And consistently obviously meetings about out some organic several prudent And We're cost had, last industry-leading delivering expanded years. we're importantly, expenses in technology. which generate the on

delivering double think and in growth. points op coming generated XX while our bps basis are And results. we indicators year-on-year of I those income margin improvement. delivered XXX EPS rose We're all revenue of We And scale sequential profitable expansion digits. through

or head Over $X.X while flat slightly months, the XX trillion count is actually last AUM's up lower.

showing of margin is I productivity, So feel which like and delivering expansion. we're in scale benefits

I for low the to G&A full As core mentioned, excluding planning flat mid-single year both head count, we're transaction. GIP digit growth,

our on fixed comes Larry's technology. of to automation. cost from some design, we're It It expansion. our the last comes possible, come hubs shareholders the growth our and We looking and calls and just using of from efficient heard our deliver AI. you've over to margin the clients in as and most can That those innovation I from in scale. color, more see comes few from around growth way to It hope margin organic global So today ultimately some time. major for And world. we're expand organizational drive drive optimize levers end, footprinting looking

$X.X we to are to be head I count productivity. indication trillion as good AI, trying with same Michael, how continue in would most efficiencies, investing having of more real of drive assets a recent our experience add, more more we just is the

increase going and This to be more have We're technology through -- how bring down to will to going is productivity. this is it's in think driven done, inflation critical. I America. which

also And through means more to and we drive overall wages. continue productivity. What rising that process, it actually is

percent doing a overall do people the people really organization. of organization is the with our more ambition. less and as That So is whole more

Worthington Your question comes next JPMorgan. with from Ken

have picked data Fixed U.S. industry for same mutual U.S. pickup so industry the the -- year, income far proportionate for up but this show BlackRock. a that flows fund the track don't services

levels at income last year. fixed sales $XX seen billion, ETF Your were but solid below

and Can may and in retail think you extent changed appetite U.S.? investor fixed fixed for you have the the do income inside talk XXXX? competitive to about what income outside both And landscape ETFs,

and about a new are all been all fixed having the Fed. allocation around clouded we're So The the income. systems by into Rob inflation noise of It's that here. very the conversations much across distribution

rates remains So watch, a structure to indicator to that's to going wait. intermediate balanced see fixed income. start be longer-term more where currently inverted and paid we'll investors are demand the and for yield to interest getting curve term and of is the And

quarter for into $XX bond billion, the So we and first flows of which us the about in think flows the immunization the saw ETFs in institutional of strength activity were active from is I XX% strategies. considerable,

set high longer-term benchmark fixed and unconstrained really are AUM yield, demand strategies above seeing in to the years we're the active active performance the income fixed taxable or this. So that's capture the for XX% has led and the X median peer that into to flows fact our up of return income renewed the total and about last our

to fixed delay But in more I that on do out noise earn think there now can focused attractive is and you which X%, the is allocations income. that's the inflation fact causing right still very the

growing encouraged in other we alongside a active market is private of The I'm part strategies. are fixed more finding why income strategies high-performing interest

stand very in once changes that some see well to So bode you I the yield think we curve.

me precipitously. that Ken, question. the just an down to have large pension add, the industry, an overallocation equity in rotation operator, slowed Let area equity money private and of the private funds as do of believe Ken's I has

are are evidence their clients liability more balance more a higher meet also and that cash discharges. to keeping of seeing We

higher and balances, keep cash they the private And velocity so of actually without money equity, to too. the in momentum have

something that I be too. So is to think watched,

believe was allocation industry for in there in factor unlock movement you the equity, If see and products. a fixed income do the other would income-producing I private an of

Blostein to Sachs. Goldman next go Alex with We'll

area? And broadly? still somewhat markets, acquisitions I growth is just Maybe that that, remind opportunity. markets private markets transformational related you've and related to early private again My it pursue Or done. Larry, GIP. guess for in enough to in retail you're to significant trying this is quite give this what large the referred to on been maybe similar this a more you related you as has some pursuing morning and you terms other of days. that how products of deal in us to ones the in question private BlackRock, do Does expect BlackRock accomplish to are

offer It's a and in. then jump thoughts Martin. I'll will Larry few

a It's billion continue clients investments sort of allocations a all also are assets, our increase there. drove been talked had got private illiquid first acquisition what billion planned added illiquid We're return of getting has eFront. vintage. roughly organic We've for our offset our final in made of alternatives of GIP. acquisition $XXX of quarter funded capital our business. alternatives that great closes Let's close which Infrastructure our what we've but the say, to time inflows good of of by build of We've to $XX drove look, their That's IV and And great a of markets. credit capital. fee a private decarbonization it's reached Infrastructure about. $XXX size. There focus to billion of business committed, BlackRock uninvested $X for We paying. on billion deployment fund partners, I

the So there's good in system. dry powder

originating As strong unique really Larry we're mentioned, transactions there.

going our a that's expanding we plan. capabilities So in to are think way

an with where a we be of infrastructure to in million yesterday, going financing announced debt Just $XXX structured about deal Santander transaction. loans infrastructure we're

just with we across of year fundraising GIP. had see into we've $XXX good continue to can XXXX, platform, with capital think kick gross we next see good which billion clients. we momentum Since the And momentum,

we've to the products And building been retail strategies. for you out our mentioned, semi-liquid with credit topic

a AUM. received have interval is BDEBT billion-plus a of our for combined national nontraded funds credit strategy We $X credit wirehouse. BDEBT really Our at and placement important a BDC

strong be we for organic seller So think a in will that growth.

for we the our illiquid finally, stronger philosophy then really build platform capabilities. business that on We think in formation and GIP a can alternatives. be have of this scale to going And much planned with capital is extend acquisition

platforms opportunity think to wealth there's keep LTIP globally, structures. retirement our and retail on bring GIP's a in We also obviously, capabilities And updated you progress. private great to the the we'll with and LTAF Europe U.K.

I so we in with that avenues us company countries. driving I Avenues a from be I night, the last major the the energy organization for in feedback also going we're many growth going origination more our X opportunity unique having proprietary infrastructure. with a had would clients, believe dinner add including especially up avenues. with the of but is companies, open just have do for is to more markets, accelerated to combinations private driving

other want GIP. to in we're BlackRock the if anything because close market at we be will to that knocking different that doing we're opportunities. looking to slowing to the through pursue. and minded X we not and opportunities. pursue thing the if look, doors forthcoming here it And continue not there's see are is being open We're one suggest said, different for opportunities And always But #X to private opportunities sense do to is down market makes looking day, more at to we're

to Jefferies. next We'll go Dan with Fannon

for your means flows, throughout the trends that fee a comments quarter in on context Martin, what you for improving rate? for maybe can put exit

also activity And you more can mix and products base pipeline forward? of and inform on that's might this going of fee fees your talk the how outlook about building, specifically that

Yes.

So thanks, Dan.

we we're when running days, of the And the trends months, we're fee halfway or As were end at the momentum. QX, I half see look good At at target. to than growth. this end mentioned, target. plus base at like feel over we I quarter, as At not we mentioned, we target our of hotter

momentum. got fee base we've So good

were First and much is impact the movements the flat largely a of AUM market to is securities rate on QX $X.X quarter day base to fees, QX excluding fee organic which the basis. lending entry rate fee up compared X% billion, due And is ex lending, pretty growth. year-on-year, count which equivalent fee on

trends, active mix. are as about billion as with overall, which mostly had, we we think good I retail think we've $X But see we about -- coming in, mentioned, good flows I $XX flows the see into of billion fee rate

flat We fee efficient the clients the of on fee focus the most really growth But investments terms more focusing specific way output. fee we're lending driving make. is compared or an the the QX organic rate on focus rate base -- I on fee rates focusing the rate as think on on good. We possible, in the We day But to they count. trends ex fee don't are entry mentioned, want fee raising QX assets on same is and of where the a the we focus rate rate to QX clients, on product. in fee fee

We'll with go Katz TD Bill next Cowen. to

continue pool performance sort that And vein, the how we high. And as of update. might Appreciate migrate post-GIP? bigger reaching Maybe wondering, comp your to fees? into as to continue different ratio new performance fees are of sort the ahead, private just a to of markets look you normalized run pretty we translate a of particularly a level

Thanks, Bill, it. for the question. We appreciate

in they're year-on-year. performance about up million the Xx $XXX the fees on So of obviously, quarter,

put vol SVB. If 'XX, machine you difficult a a the time really in cetera. was to quarter and in could think had first et yourself in some market. back it markets, We that had We rate

So it tough a I think time. was

], and half about kind coming equity seen teams, very funds talked [ half really and hedge other funds, that. liquid programs our which private of performance we performance distributions which the realizations justice in of on of strong Larry year, has This some in that associated I from think where is had hedge private successful well. fees. Rough very, some funds And the is very of was our our systematic quarter, we've strategies about coming equity more strategic performance equity through some those last in been creating our reflected and fee good that as with

ultimately, Ultimately, performance markets key and And we markets on performance, strong one of obviously, healthy revenues and our where talent drop stronger expect deliver to there's a picking our goal supportive long-term lot it to And of to basis. be alignment a see ratio. we'd go-forward a expect is with lower leverage performance comp-to-revenue investments there. and is that fee to But up, clients. more we'd

with Bedell Brian to next go We'll Bank. Deutsche

a category within areas Maybe and couple just to on of multi-asset the focus that.

guess, I organic deals growth, Can Martin, even with, the organic anticipate think, your also early, and unfolds. that the to pipeline, talk as but contributing you next comments throughout in we LifePath developed Obviously you the particular, year, areas, as the then about X the and over of how that growth conjunction up of year Paycheck, in as I Larry, conversation also years. that were you obviously talking about with would pipeline. the start couple very be build about OCIO

LifePath can I Larry a can question. maybe little Thanks guess Sure. on with multi-asset I Appreciate for it. and start so much comment the flows then Paycheck. on the color

multi-asset see in Paycheck. demand continued we inflows but Date LifePath obviously, billion. offerings. with launch about strong also after billion we strong had in upcoming for our ahead significant by really quarter the LifePath the $X inflows Those of of So $XX driven core XXXX growth that strategy saw business, And the were a in Target

several in thanks has LifePath Date of generated in billion billion funding franchise about flows to the quarter, large the of first $XXX $X mandates. Our assets, Target

We X%. have about an organic growth rate of

business the So X% market the terms core We to of outperform billion about continue of we're relative industry. leading there we're on flows a growth. had $XX Again, in there. strong to and in growth 'XX, was we which building

We're the #X firm. investment-only, DC DCIO

And at Most are global. And in the area Paycheck, innovation finance assets growth. provider, that's and at only advocacy we're the I LifePath plans. investing We we're of have the doing our been is a of exciting and history. and It's to DC really innovation XX,XXX forefront part that our throughout of a future think, we've the significant organic solutions BlackRock key think, growth. of retirement retirement, we for our

to I remarks, Paycheck. plan we transform corporations their prepared defined my As LifePath said preparing that to are contribution XX have in

clients we're plans. many actual to So other Many the is having so implementation these enormous. clients the with conversations wanted see of

in remarks, the really make going to many us of the weeks. be about plan we the We'll issue to the next have and forward. As few big for said is we in implementation prepared going that a announcements first that, plan first

retirement to for this eliminates decisions I some benefits retirement. before, movement this said individuals defined is And The to stranded own uncertainty many, by of change many making from defined have as going believe, contributions in themselves. left the of away their retirement. We the

The going that the narrow lot very variability terms but what integrating investment of Target through transformation this are wrappers do you corridor really you -- to once eliminated And what been have of that month. innovation how no be you strategies have? can of of each the has a insurance narrow bringing retirement, dollar the Date outcomes has amount the of around a earning there they're retired, individual know can in

longevity, bigger to And letter, having a certainty as alleviate become I this of the growing is going and issue. will said of in bigger retirement with really some my And type fear.

be As beginning too. I And and clear, let are said, broad. places, are also the now conversations conversations me our Europe in other

the over a So we rates of as X our major next component future this look at to years. growth X

But Obviously, all -- it's but it Target more relationships not the a with so our is product. can product. Date highest -- it's deeper It fee-based with clients, clients. generate like more connectivity

has And so proud this of something in I'm retirement BlackRock created, very is firm a what and do benefits. that as the I it's leader believe transform to going

Davitt with back Autonomous Research. go Patrick We'll to

like ETFs. on flow equity to more U.S. to question active passive track Obviously, is Europe year. in far mix this continues Europe the the so My

you theme? of positioning update And aggressive around what defensibility us the that on price seeing extent you're So your to competition? more firstly, could

continuing higher indefinitely? in level, ETFs could finally, Europe trend change to what bought are how more and that portend a extent catch-up this so-called in seeing And sold you're real

question. Thanks, the Patrick. Really appreciate

about competitive of the That's continues globally All strong the very in mid-single baseX single-digit very As digit the business growth. exceed the our player. inflows. to market been had in income and and inflows we inflows of we the market Xx a iShares share stressing real And about we of mentioned, #X led lead with Europe. fixed X billion IBIT. I'm way, The high players inflows combined. position are the of strength growth, XX% quarter, $XX business question, is the the glad iShares core first have just European the strong. But running fee in for by X and trends iShares asset

franchise in bigger than billion iShares next combined. Our X Europe AUM, players that's is $XXX

management than buying think, a dynamics obviously, U.K. market I are preferred are strong of here real to very buying have exchange-traded units, in really in funds discretionary very a and iShares opportunity the competitive units private largely in programs, United provider. So and we grow banking ETFs we States a very, how uses terms the the private different they are is that And sold. Europe. there, outsized the through This is and think

I system, markets trillions about States want The a securities ETF you to trillions of exchange. best unified Europe fragmented and growing. been offer with best this growing bid, think and and growing, national business national built more has way. a regulator, it United has dollars

Europe, dynamics is leadership see, favorable think, the So to iShares we post market trending growth. buying a we and regulation there, great as is obviously, really in outsized position in very favorable

for gentlemen, Fink, and Mr. allotted remarks? you the Thank closing reached any do you. we Ladies have questions. have time

want in Yes, last morning I thank joining your BlackRock. operator, this for and continued for interest comment. one to us everybody

in each a is client, commitment performance and of the Our evolving ahead direct of steadfast every trends for and their needs. our our to clients, long-term result serving

We strongly more and believe great quarter. started BlackRock I more XXXX great you, that other and than momentum, there with time for ahead are a any opportunities before. Thank everyone, have

concludes This today's teleconference.

may now disconnect. You