BlackRock, the world’s largest asset manager, reported record assets under management (AUM) of about $10.5 trillion in the first quarter, with a 36% increase in profit due to a rebound in global equity markets. The surge in AUM was a result of global equity markets rallying on expectations of central banks cutting interest rates, leading to a 15% increase in AUM and a nearly 9% rise in investment advisory and administration fees for BlackRock.
CEO Larry Fink expressed optimism about opportunities for BlackRock, citing areas such as artificial intelligence, emerging markets, and the need for new infrastructure. The company’s acquisition of Global Infrastructure Partners for $12.5 billion aims to expand into private markets and alternative assets through infrastructure investments globally, with plans to close the deal in the third quarter. Despite stagnant revenues and political attacks on its ESG business in the U.S., BlackRock remains open to pursuing more private market opportunities.
While total net inflows fell in the first quarter, analysts anticipate a re-acceleration in industry flows after interest rate cuts incentivize the movement of cash into riskier assets. Exchange-traded funds (ETFs) captured the majority of inflows, with the iShares Bitcoin Trust drawing $14 billion in net inflows since its launch in January. BlackRock’s total revenue increased by 11% to $4.73 billion, with higher performance fees, technology revenue, and market impacts on average AUM.