BlackRock Hits $11.5 Trillion of Assets as Q3 Inflows Surge to $221 Billion📈

(BLK.US) released its Q3 2024 earnings report today ahead of the Wall Street session and is gaining 1.5% in pre-market. The world's largest asset manager's shares are likely to react to the strong overall performance, with record assets under management and significant net inflows. BlackRock reported better-than-expected Q3 net revenues in almost every segment, with particularly strong performance in long-term inflows and equity net inflows. The company's technology services revenue slightly missed expectations, showing a 1.56% year-over-year decline. BlackRock's total net inflows reached $221.18 billion during the quarter, significantly exceeding analysts' expectations and putting the company on track to surpass its annual targets. Apart from the slight miss in technology services revenue, the report was solid, showing much higher than expected assets under management, net inflows, and EPS. Return on equity of 13.0% also turned out to be higher than expected. Still, as the world's largest asset manager, BlackRock's ability to continue attracting significant inflows and growing its assets under management across various segments draws the most attention and is likely to drive the market's reaction to the earnings release. Implied one day move for the company based on historical data was 2.19%, with an average surprise of 6.66% above consensus for adjusted EPS. 

Highlights

• Assets under management (AUM) reached a record $11.5 trillion, up 26% year-over-year
• Total net inflows of $221.18 billion, significantly exceeding estimates
• Adjusted EPS of $11.46, beating expectations
• Revenue rose 15% year-over-year to $5.2 billion

BlackRock Q3 2024 Results

• Assets under management: $11.48 trillion vs $11.19 trillion expected (+26% YoY)
• Total net inflows: $221.18 billion vs $127.2 billion expected
• Long-term inflows: $160.17 billion vs $100.02 billion expected
• Adjusted EPS: $11.46 vs $10.40 expected (+5% YoY)
• Revenue: $5.20 billion vs $5.0 billion expected (+15% YoY)

Segment Breakdown

• Equity net inflows: $74.14 billion vs $29.5 billion expected
• Fixed Income net inflows: $62.74 billion vs $58.44 billion expected
• Institutional net inflows: $55.90 billion
• Retail net inflows: $6.86 billion

Other Key Metrics

• Operating margin: 38.6% vs 38% expected
• Adjusted operating margin: 45.8% vs 44.1% expected
• Base fees and securities lending revenue: $4.03 billion, in line with estimates
• Investment advisory performance fees: $388 million vs $158.7 million expected
• Technology services revenue: $403 million vs $405.1 million expected (-1% YoY)
• Total expenses: $3.19 billion vs $3.09 billion expected (+11% YoY)

Additional Notes

• Year-to-date total net inflows of $360 billion have already surpassed full-year net inflows of 2022 and 2023
• BlackRock completed the acquisition of Global Infrastructure Partners (GIP) on October 1st, adding $116 billion in client AUM
• The company is positioning itself as a comprehensive platform for global clients to invest across public and private markets
• BlackRock benefited from the surge in stocks and increased cash flow into fixed-income and private funds