BlackRock with a new AUM record, although results are disappointing 📊

BlackRock (BLK.US) reported its Q1 2025 results, which came in slightly below expectations. These results do not yet include the market panic that emerged after Trump's "Liberation Day," but they already reflect increased investor uncertainty, resulting in lower-than-expected net inflows. Nevertheless, the fund set another record in assets under management, reaching $11.58 trillion at the end of Q1 2025, up 11% year-over-year.

Pre-market trading indicates a slightly positive opening (about 0.7% above yesterday's close), although this is not so much due to a positive investor reception of the results as it is due to the earlier pricing of potential weakness from the strong declines in the last week.

Source: xStation

BlackRock reported below-expectation results on almost every key financial metric. Although the company's revenue was $5.28 billion, which is close to the estimated $5.3 billion, its net inflows amounted to $84.17 billion, nearly $12 billion less than the consensus estimate. Institutional net outflows of $37.18 billion indicate a slight deterioration in sentiment among professional clients.

There is a sharp decline in revenues in the performance fee segment, although, given the significant declines in the U.S. market since the beginning of the year and a record-low quarter, this should not come as a big surprise.

The company's operating margin was 32.2%, almost 4 percentage points lower than the consensus expectation.

A positive aspect of the results, however, is the adjusted EPS, which came in at $11.30—over $1 higher than the consensus estimate.

1Q25 FINANCIAL RESULTS:

• Assets under management $11.58 trillion, +11% y/y, estimate $11.62 trillion 
• Adjusted EPS $11.30 vs. $9.81 y/y, estimate $10.11
• Net inflows $84.17 billion, +47% y/y, estimate $96.02 billion
  • Long-term inflows $83.35 billion, estimate $105.15 billion
  • Institutional net outflows $37.18 billion
  • Retail net inflows $13.12 billion
  • Equity net inflows $19.31 billion, estimate $35.41 billion
  • Fixed Income net inflows $37.74 billion
• Revenue $5.28 billion, estimate $5.3 billion
  • Investment advisory performance fees $60 million, -71% y/y, estimate $126.9 million
  • Base fees and securities lending revenue $4.40 billion, +16% y/y, estimate $4.36 billion
  • Technology services revenue $436 million, +16% y/y, estimate $439.4 million
• Operating margin 32.2%, estimate 36%
• Adjusted operating margin 43.2%, estimate 42.6%
• Total expenses $3.58 billion, +18% y/y, estimate $3.4 billion