Investment Landscape - The appetite for investment in the Gulf region has significantly increased, characterized as an "explosion" in interest over the past decades [1][4] - KKR has transitioned from raising funds to actively investing in the region, with a notable presence in Abu Dhabi, Dubai, and Riyadh [5][7] - KKR's assets under management have grown from $83 billion to over $725 billion in 12.5 years, with $110 billion in dry powder available for investment [7] Geopolitical Dynamics - The global investment landscape is being reshaped by new strategic alignments among Gulf States, balancing ties between Washington, Beijing, and Moscow [8] - The shift from benign globalization to a multipolar world has led to increased geopolitical tensions, affecting trade and investment flows [9][11] - Geopolitical factors are now integral to the investment diligence process, influencing decisions across various markets [13][14] Artificial Intelligence and Technology - AI is expected to have a massive impact on the global order, with significant investments in AI enablers such as data centers and chip manufacturing [15][16] - The U.S. is currently leading in AI and chip technology, but China is advancing rapidly in application development [17][18] - AI is transforming industries and military operations, with implications for future warfare and defense strategies [21][22] Military and Defense - The future of warfare is increasingly reliant on unmanned systems and algorithmic piloting, necessitating a shift in military capabilities [40][41] - The U.S. must adapt its military strategy to reflect lessons learned from conflicts like Ukraine, focusing on innovation and rapid deployment of new technologies [36][39] - The ongoing conflict in Ukraine highlights the need for robust security guarantees and financial support for Ukraine to counter Russian aggression [50][55]

Group 1: AI and Chip Industry Dynamics - The US maintains a lead in the AI and chip sectors, particularly in chip imports, while China excels in AI applications [1][2] - The US innovation in AI is driving significant productivity gains, contributing approximately 0.9% to the 1.6% real GDP growth in 2023 [3] - Current large language models (LLMs) are at the level of a great graduate student, with advancements expected to reach the capability of a good PhD within a year, and a Nobel laureate level shortly thereafter [4] Group 2: Geopolitical Implications - The competition in AI is characterized by relative degrees of dominance rather than a clear winner or loser, impacting military and economic advantages [5][6] - AI is transforming warfare, with significant applications observed in the ongoing conflict in Ukraine, where AI technologies are enhancing operational capabilities [6][9] - The battlefield is increasingly reliant on unmanned systems, with Ukraine deploying around 9,000 drones daily, many of which are suicide drones [8][9]

PresentationAlexander BlosteinGoldman Sachs Group, Inc., Research Division Okay. Good morning, everyone. We'll get started with our next session. It is my pleasure to introduce Scott Nuttall, Co-CEO of KKR. With over $720 billion in assets under management, KKR is one of the largest and fastest-growing global alternative asset managers across private equity, real assets and private credit, again, across many other capabilities as well. KKR has had a very active year so far, delivering strong investment perf ...

KKR Conference Call Summary - December 09, 2025 Company Overview - KKR (NYSE: KKR) is a leading global alternative asset manager with over $720 billion in assets under management [1][1] - The company has raised over $100 billion in capital in 2025, indicating strong investment performance and activity [1][1] Economic Outlook - The economic landscape is characterized by a bifurcation, with different sectors experiencing varied outcomes [3][4] - The U.S. has been in a manufacturing recession for the past 2-3 years, while larger companies have seen margin expansion from 14% to 19% over five years [4][4] - The next few years will reveal the impact of past investment decisions, leading to a clearer distinction between successful and struggling businesses [6][6] Fundraising and Investment Themes - KKR is on track to meet its target of raising over $300 billion from 2024 to 2026, having raised approximately $200 billion so far [9][9] - Significant demand is noted across all asset classes, particularly in credit, which accounted for $55 billion of the $101 billion raised in 2025 [12][12] - Real estate equity remains challenging, but there is growing interest in real estate credit [14][14] Realization Activity - KKR has seen a ramp-up in realization activity, with a projected $1 billion in monetization income over the next quarters [19][19] - The firm has approximately $17 billion in unrealized carry, up 10% year-over-year, indicating strong underlying portfolio performance [21][21] Private Credit Growth - KKR expects continued robust growth in credit, managing about $280 billion in credit assets, with $130 billion in private credit [24][24] - Asset-Based Finance (ABF) is highlighted as a significant growth area, with $84 billion in AUM, up 30% over the last year [29][29] Real Assets and Infrastructure - KKR's infrastructure business has grown to $95 billion in AUM, with management fees increasing over 20% annually [33][33] - The firm anticipates a cyclical recovery in real estate, with $85 billion in AUM, half of which is in credit [36][36] Wealth Management Expansion - KKR's K-Series has grown to $32 billion in assets, with plans for further expansion in distribution networks and product offerings [39][39] - The partnership with Capital Group aims to reach a broader audience, targeting households below the accredited investor level [44][44] Strategic Holdings and Dividends - KKR's Strategic Holdings segment is expected to increase dividends from $120 million to $350 million by 2026, with steady revenue and EBITDA growth [54][54] - The focus is on companies that provide attractive long-term cash flows and are recession-resistant [56][56] M&A Strategy - KKR has engaged in strategic acquisitions totaling $10-$11 billion, focusing on businesses where it can be a top-three player globally [61][61] - The firm emphasizes cultural fit and permanency of capital in its acquisition strategy [62][62] Conclusion - KKR is positioned for continued growth across various asset classes, with a strong focus on private credit, infrastructure, and wealth management, while navigating a complex economic landscape [1][1][3][4][9][12][24][33][39][54][61]

Core Insights - KKR has announced the promotion of 8 individuals to Partner and 39 to Managing Director, effective January 1, 2026, highlighting the importance of people, culture, and values in the firm's success [1] Group 1: Promotions - The following individuals have been promoted to Partner at KKR: - Hans Arstad, Private Equity, Stockholm - David Cheong, Real Estate, Tokyo - Patrick Devine, Next Generation Technology, London - Marco Fontana, Infrastructure, London - Doug Krupa, Global Client Solutions, New York - Amanda Magliaro, Credit & Markets, New York - Andrew Peisch, Infrastructure, New York - Vance Serchuk, Global Institute, New York [1] - The following individuals have been promoted to Managing Director at KKR: - Annabel Arthur, Marketing & Communications, London - Patricia Bandeira Vieira, Global Client Solutions, Dubai - Alice Bush, Global Client Solutions, London - Patrick Clancy, Credit & Markets, New York - Claudia Coppola, Human Capital, London - Derek Craig, Global Client Solutions, New York - Michael de Freitas, Global Client Solutions, Dubai - Amy Edwards, Compliance, London - Luca Fonsati, Finance, New York - Andy Freeman, Insurance, New York - Carlos Galvez, Credit & Markets, San Francisco - Ellen Hoch, Human Capital, New York - Hi Joo Hong, Private Equity, Seoul - Anogie Joseph-Erameh, Capstone, London - Mireia Just, Insurance, New York - Meghan Kies, Human Capital, New York - Dru Kleinfeld, Human Capital, New York - Lydia Lee, Marketing & Communications, Singapore - Patricia Ludwig, Capstone, Menlo Park - Matt Magill, Global Client Solutions, New York - Ken Matsumura, Private Equity, Tokyo - Samuel Mencoff, Credit & Markets, New York - Daniel O'Neill, Legal, San Francisco - Frank Panico, Operations, New York - Wonda Quinn, Legal, New York - Anuv Ratan, Health Care Strategic Growth, Menlo Park - Tal Reback, Credit & Markets, San Francisco - Robert Recer, Private Equity, New York - Matthew Rooney, Global Client Solutions, Sydney - Jeff Schwartz, Compliance, New York - Rosa Silva, Finance, New York - Eric Stout, Private Equity, New York - Julian Suhren, Capstone, London - Raj Sundar, Capstone, Singapore - Grant Thomas, Credit & Markets, San Francisco - Daniel Valladares, Global Client Solutions, London - Cav Walters, Infrastructure, New York - Jason Wang, Private Equity, Shanghai - Frank Yin, Real Estate, New York [1] Group 2: Company Overview - KKR is a leading global investment firm that provides alternative asset management, capital markets, and insurance solutions, aiming to generate attractive investment returns through a disciplined investment approach and world-class talent [1]

Core Insights - Capital Group, a historically low-profile asset management firm, is undergoing a significant strategic transformation to adapt to the competitive landscape dominated by passive index investing and ETFs [1][11][12] - The company is expanding its ETF offerings and strengthening its partnership with KKR to attract more retail investor funds, marking the most fundamental shift since its founding in 1931 [1][11][12] Company Strategy - Under CEO Mike Gitlin's leadership, Capital Group aims to enhance its visibility and solidify its position among clients while attracting new ones [3][14] - The firm is collaborating with KKR to launch new fund products targeting retail investors, including a target-date retirement fund that combines public and private assets [3][14] - The partnership with KKR is designed to bridge the gap between institutional investors and retail investors, providing diversified investment opportunities [3][14] Market Context - Capital Group has faced net outflows from its stock mutual funds and related products for the past decade, prompting the need for transformation [4][15] - The firm is particularly focused on the private market as a new frontier, recognizing the increasing competition from firms like Apollo and Blackstone [6][17] Cultural Shift - Capital Group is moving away from its historically secretive and unique corporate culture to appeal to retail investors, including promotional activities like a hot air balloon campaign [7][18] - The company has a strong distribution network, serving over 20 million households and approximately 75% of financial advisors in the U.S., which is a significant asset in its new strategy [9][20] Fund Development - The new funds developed in partnership with KKR, including Capital Group KKR Core Plus+ and Capital Group KKR Multi-Sector+, will allocate 60% to public market debt and 40% to private credit [10][21] - The assets under management for the two new funds have already exceeded $500 million [6][17]

Core Insights - Capital Group is partnering with KKR to launch funds aimed at retail investors, including a target-date fund for retirement plans that will incorporate both public and private assets [1][4] - The firm is shifting its strategy to attract more retail money through a marketing campaign and expanding its ETF lineup, marking a significant change since its founding in 1931 [4][5] - The partnership aims to provide diversified portfolios that blend public and private markets, addressing the gap between institutional and retail investment options [7][26] Company Strategy - Capital Group has historically maintained a low profile but is now actively seeking to engage retail investors as competition from private-market firms increases [6][5] - The firm has experienced net outflows from its equity mutual funds for the past decade, prompting a need for strategic evolution [8][5] - The new funds with KKR have already attracted over $500 million in assets under management, indicating initial success in this new venture [9] Market Position - Capital Group manages approximately $3.3 trillion in assets and is known for its American Funds, which have significant investments in major companies like Nvidia and Amazon [3][5] - The firm has relationships with over 20 million households and 75% of U.S. financial advisers, providing a strong distribution network for its products [25][34] - Despite strong performance in certain funds, clients have withdrawn $122 billion from its largest mutual fund since 2015, highlighting challenges in retaining investor interest [23][21] Product Development - The new funds, Capital Group KKR Core Plus+ and Capital Group KKR Multi-Sector+, will target a mix of 60% publicly traded debt and 40% private credit [27] - The partnership is designed to create products that are more accessible and easier to implement for retail investors, reflecting a shift in Capital Group's approach [34][35] - Negotiations regarding fees and product rollout timelines have been complex, but both firms are aligned on their strategic goals [28][30] Cultural Shift - Capital Group is moving away from its traditionally secretive culture to appeal more to retail investors, including unique marketing efforts like a hot-air balloon campaign [15][16] - The firm is undergoing personnel changes, including hiring for new roles focused on private markets, indicating a shift in operational strategy [19][17] - The CEO, Mike Gitlin, is actively engaging with the public through social media and podcasts to reshape the firm's narrative and attract a broader audience [16][8]

Core Insights - Capital Group, historically low-profile, is shifting its strategy to adapt to the changing investment landscape, particularly the rise of passive investing and ETFs [2][3] - The firm is launching a marketing campaign, expanding its ETF offerings, and forming a partnership with KKR to attract retail investors [3][5] Company Strategy - The $3.3 trillion firm is concerned about being left behind as competitors like Apollo and Blackstone enhance their retail offerings [4] - Capital Group's CEO Mike Gitlin emphasizes the need for the firm to evolve and strengthen its client relationships [4][7] - The partnership with KKR aims to create diversified portfolios that combine public and private market assets [6][25] Financial Performance - Over the past decade, Capital Group has experienced net outflows from its equity mutual funds, with clients withdrawing $122 billion from its largest fund since 2015 [7][20] - The firm’s ETFs, launched in 2022, have accumulated about $100 billion in assets, but this is not enough to offset the losses from traditional mutual funds [18] Market Position - Capital Group has strong distribution networks, with relationships with over 20 million households and 75% of U.S. financial advisers [23] - The firm is attempting to capture a share of the growing retail investor market, which is seen as a significant opportunity for future growth [32] Product Development - The new funds created in partnership with KKR will target a mix of 60% public debt and 40% private credit, with plans for additional funds focusing on private equity and real assets [25] - The co-managed funds will charge lower fees compared to KKR's traditional offerings, aiming to be more accessible to retail investors [27][31] Organizational Changes - Recent leadership changes include the appointment of new executives and a shift in Gitlin's role to focus solely on business operations [15][16] - The firm is also hiring for a head of private markets, indicating a strategic pivot towards this asset class [17]

Fund Performance - Baron Fifth Avenue Growth Fund gained 5.7% in Q3 2025, underperforming the Russell 1000 Growth Index's 10.5% gain and the S&P 500 Index's 8.1% return [1] - Year-to-date, the fund is up 14.4%, compared to 17.2% for the Russell 1000 Growth Index and 14.8% for the S&P 500 Index [1] KKR & Co. Inc. Overview - KKR & Co. Inc. is an equity and real estate investment firm with a market capitalization of $113.138 billion and a share price of $122.19 as of December 01, 2025 [2] - The one-month return for KKR & Co. Inc. was 3.30%, while it experienced a 22.62% decline over the last 52 weeks [2] Investment Strategy in KKR - The fund increased its position in KKR & Co. Inc. to capitalize on price volatility towards the end of Q3 2025 [3] - KKR manages $686 billion in assets across Private Equity, Private Credit, and Real Assets, and is in a three-year fundraising super-cycle expecting to raise over $300 billion [3] - KKR has diversified its business beyond traditional buyout private equity into alternative asset classes, maintaining over $150 billion in assets under management in each of its three scaled businesses [3] - KKR's asset management business generates highly recurring fees, and it also owns Global Atlantic, an insurance company involved in the retirement assets market [3]

Group 1 - KKR-backed Musinsa has reportedly selected Citigroup and JPMorgan to handle its initial public offering (IPO) [1]