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BlackRock attracted a record amount of new money in each of the final two quarters of 2024, driving net inflows at the world’s largest asset manager to $641bn for the full year.
The company reported assets under management of $11.55tn at the end of December — an all-time high but short of analysts’ expectations of $11.66tn.
The inflows helped push revenues during the final three months of the year to $5.68bn, a 23 per cent increase on the same period in 2023 and surpassing analysts’ forecasts. Full-year revenues rose 14 per cent in 2024, passing $20bn for the first time.
The performance underlines BlackRock’s rapid growth since its initial public offering 25 years ago when it had $165bn in assets under management and 650 employees.
“BlackRock is now truly in a category of one,” said chief financial officer Martin Small. Vanguard, the world’s second-largest asset manager, has $9.7tn in assets under management.
BlackRock said it had benefited in 2024 from rising markets, which helped lift the value of its assets under management.
US stocks soared last year as investors bet that Donald Trump’s return to the White House this month would lead to corporate tax cuts, deregulation and a wave of dealmaking. The total return on the S&P 500 was 24.5 per cent in 2024.
The company also managed to increase base fees, while its $12.5bn purchase of private capital group Global Infrastructure Partners made it the world’s second-largest manager of private infrastructure assets.
Net income for the quarter increased 21 per cent to $1.67bn compared with the same period in 2023.
BlackRock chief executive Larry Fink said GIP was the group’s “most significant acquisition” since it bought Barclays Global Investors in 2009, a deal that gave it a dominant position in passive investing and helped make it the world’s largest money manager.
Fink said 2024 had been a “milestone year for strategic acquisitions”. The group spent almost $30bn on three deals last year as it rushed to expand its share of the fast-growing and lucrative market for private assets, and to diversify beyond the low-cost ETFs and index products that are its bread and butter.
As well as the GIP deal, which closed in the fourth quarter, BlackRock announced in June the acquisition of UK private markets data group Preqin for £2.55bn and a $12bn deal in December for private credit manager HPS Investment Partners. The deals are due to be completed by mid-2025.
Adjusted profit margins increased to 45.5 per cent from 41.6 per cent in 2023. The push into private markets could drive “higher fee rates, better revenue growth and higher profit margins over the long-term” if the acquisitions were successfully executed, wrote Kyle Sanders, an analyst at Edward Jones.
“Our record organic growth and financial results do not yet reflect the full integration or pending acquisitions of the high-growth businesses of GIP, HPS and Preqin,” said Fink. “And we’ve steadily made organic investments ahead of structural trends that we expect to drive outsized growth in the years ahead.”
Shares were up 3.7 per cent in pre-market trading in New York.
The Financial Times revealed on Tuesday that top BlackRock executive Mark Wiedman — widely discussed for more than a decade as a potential successor to Fink — was leaving the company, disrupting the asset manager’s planning for the chief executive’s eventual retirement. Fink confirmed that Wiedman was leaving and said that several senior leaders would take on expanding roles.
https://www.ft.com/content/53124602-5c86-4495-93df-7479543d6fbb
