BlackRock, Inc. Beats Earnings Estimates

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BlackRock released its second quarter earnings report before opening bell this morning, posting adjusted earnings of $4.96 per share and revenue of $2.91 billion. Analysts had been expecting earnings of $4.81 per share and revenue of $2.86 billion. In the same quarter last year, BlackRock reported adjusted earnings of $4.89 per share and revenue of $2.77 billion.

Key metrics from BlackRock’s earnings report

Reported earnings were $4.84 per share, compared to $4.72 per share in the same quarter a year ago. Adjusted margin was 44.9% compared to last year’s 42.4%. Assets under management increased 3% year over year to $4.72 billion. Cash assets under management fell 7% to $271.5 billion due to seasonal outflows, while advisory assets under management fell to $12.9 billion.

Long-term net inflows were $17.5 billion in the Americas, while net outflows from Europe, the Middle East, and Africa were $24.1 billion and net outflows from the Asia-Pacific region were $0.7 billion. BlackRock Chairman and CEO Laurence Fink said in a statement:

“Year-to-date, a desire to reallocate and/or address cash needs drove ten of our largest clients to redeem over $40 billion of institutional index equity assets. However, those same clients reinvested across BlackRock’s active equity and fixed income, multi-asset and alternatives strategies, resulting in a positive net revenue impact for the firm. This demonstrates the value of the deep, strategic relationships we maintain with our clients and validates the strength of our solutions-oriented business model.

BlackRock’s results by segment

BlackRock reported long-term net inflows of $10.8 billion in its Retail segment, including $7.4 billion in domestic net inflows and $3.4 billion in international inflows. Inflows from fixed net income were $9.8 billion.

Long-term net inflows from iShares were $10.9 billion in the quarter, including $8.8 billion in equity net inflows. BlackRock reported that demand for exposures in international developed markets drove inflows in iShares. Long-term net inflows from institutional active clients were driven by $4.4 billion in multi-asset net inflows and rose to $2.5 billion. The firm noted continuing demand for its LifePath target-date suite of investment products. Flows into infrastructure and alternative solutions led the $0.6 billion in alternative net inflows.

Institutional index clients saw $31.4 billion in long-term net inflows and were driven by $34.6 billion in equity net outflows related to allocation of assets, cash needs and re-balancing.

As of this writing, shares of BlackRock were at $342.73.

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