The world's largest asset management company.$Blackrock (BLK.US)$Q3 revenue and profits both exceeded expectations, with assets under management reaching a new high for the third consecutive quarter at $11.5 trillion.

It is worth noting that BlackRock has made new progress in entering the private equity fund market. This month, BlackRock completed the acquisition of Global Infrastructure Partners (GIP), a private equity fund, increasing total assets under management by $116 billion.

BlackRock has indicated that its private equity market business is expected to expand rapidly. The institution recently adjusted its senior management team for global private debt business and established a direct lending group.

Revenue and profits both exceeded expectations.

BlackRock's Q3 revenue and profits exceeded market expectations. On Friday, October 11th, BlackRock released its Q3 financial report.

1) Key Financial Figures:

• Q3 revenue was $5.2 billion, higher than the expected $5 billion, a 15% year-on-year increase;

• Profit was $1.63 billion, a 2% year-on-year increase, benefiting from the positive impact of market management assets, organic base fee growth, and higher performance fees;

• Adjusted earnings per share were $11.46, higher than the expected $10.42, a 5% year-on-year increase;

2) Main business income:

• Investment consulting, management fees, and securities lending income were $4.03 billion, higher than the $3.681 billion in the same period last year.

3) Asset management scale:

• Q3 total assets under management (AUM) were $11.48 trillion, higher than the expected $11.19 trillion, mainly due to net inflows and positive market trends; over the past 12 months, BlackRock's total assets under management have increased by $2.4 trillion.

• Net inflows of $221 billion, representing 8% annual organic asset growth, showing positive growth in customer types, product types, etc., with net inflows of $360 billion from the beginning of the year to date;

4) Shareholder Return:

• Q3 share buyback of 0.375 billion US dollars;

After the financial report was released, Blackrock rose 3.37% at midday, reaching a historical high. This year, Blackrock's stock price has risen by 18%, while the S&P 500 index has risen by 21%.

Blackrock Chairman and CEO Laurence D. Fink said:

Our global strategy is very ambitious and is proving effective. The assets we manage on behalf of clients reached a new record of 11.48 trillion US dollars in Q3, an increase of 2.4 trillion US dollars over the past 12 months. During this period, clients entrusted Blackrock with a net inflow of 456 billion US dollars, of which a record-breaking 221 billion US dollars was just in Q3. Q3 saw organic base fee growth of 5%, and technology services annual contract value (ACV) increased by 15%, both reaching the highest levels in years.

Blackrock also announced on Friday that it invested an additional 97 billion US dollars in exchange-traded funds (ETFs) in Q3, and 63 billion US dollars in fixed income funds. So far this year, Blackrock's net inflows total 360 billion US dollars, exceeding the full-year net inflows for 2022 and 2023.

A Cowen Inc 7.75% senior notes due 15/06/33 USD25 analyst wrote in a report after the financial report was released that Blackrock "has set a very high standard, and we expect few peers to surpass it".

Venturing into the private equity market, the "one-stop" asset management giant

By accelerating the pace of acquiring private equity funds, BlackRock is becoming a "one-stop" asset management giant for stocks, bonds, and the increasingly growing private equity market.

In October, BlackRock completed the acquisition of Global Infrastructure Partners (GIP), adding $116 billion in total assets under management and $70 billion in fee-paying assets under management. D. Fink said:

Through various initiatives, we are developing our private equity market to better serve our clients. We have seen the power of BlackRock and GIP alliance as we recognize the enormous investment potential in infrastructure, especially in supporting AI innovation.

Meanwhile, another acquisition launched in early July this year – BlackRock's acquisition of the private equity data provider Preqin – is still ongoing, with the transaction valued at £2.55 billion (approximately $3.3 billion).

BlackRock also hinted at the expected rapid expansion of its private equity market business, with the institution recently adjusting the senior management team of its global private debt business and establishing a direct lending group. According to Bloomberg's report this week, BlackRock is considering acquiring the private equity fund HPS Investment Partners, potentially valuing it at over $10 billion.

Editor/ping