Bridge Investment (BRDG) - 2025 Q2 - Quarterly Results

Second Quarter 2025 Results Overview This section provides an executive summary of Bridge Investment Group's financial performance and strategic updates for the second quarter of 2025 Financial Highlights (Q2 2025) Bridge Investment Group Holdings Inc. reported Q2 2025 financial results, with GAAP Net Income of $2.8 million and a net loss attributable to Bridge per share of Class A common stock of $(0.01) | Metric | Q2 2025 | | :------------------------------------------------ | :------ | | Net Income | $2.8 million | | Net (loss) attributable to Bridge per share (basic & diluted) | $(0.01) | | Fee Related Earnings (FRE) to Operating Company | $28.0 million | | Distributable Earnings (DE) of Operating Company | $25.7 million | | DE per share after-tax | $0.14 | - The loss per share was attributed to approximately $4.7 million of transaction costs related to the Apollo Merger Agreement and $3.5 million in credit losses due to the write-off of principal, interest, and fees on a note receivable related to Bridge Office Fund I[38][39] Common Dividend and Apollo Merger Bridge declared a final dividend of $0.045 per share of Class A common stock, anticipating the completion of its merger transaction with Apollo Global Management, Inc. in early September 2025 - Bridge declared a dividend of $0.045 per share of its Class A common stock, payable on August 29, 2025[4] - This is anticipated to be the final dividend, as the company expects to complete the transaction with Apollo Global Management, Inc. in early September 2025[4] About Bridge Investment Group Bridge is a leading alternative investment manager with approximately $50 billion in assets under management (AUM) as of June 30, 2025, diversified across specialized U.S. asset classes - Bridge is a leading alternative investment manager with approximately $50 billion of assets under management as of June 30, 2025[6] - The company is diversified across specialized U.S. verticals including real estate, credit, renewable energy, and secondaries strategies[6] Statement Regarding Forward-Looking Information The release contains forward-looking statements regarding the proposed transaction with Apollo, future dividends, and operational plans, which are subject to various risks and uncertainties - Forward-looking statements are subject to certain risks, uncertainties, and assumptions, many of which are beyond the control of Apollo and the Company, that could cause actual results and performance to differ materially[8] - Factors and risks include the ultimate outcome of the proposed transaction, business disruptions, difficulties in retaining key personnel, maintaining business relationships, regulatory approvals, global macro-economic environment, cyber-attacks, public health crises, and litigation[9] - Neither Apollo nor the Company undertakes any obligation to publicly update or review any of these forward-looking statements[11] Additional Information Regarding the Transaction and Where to Find It This section clarifies that the earnings release is not an offer to sell securities but provides information regarding the proposed transaction with Apollo - This earnings release is not intended to and does not constitute an offer to sell or the solicitation of an offer to subscribe for or buy any securities[12] - Apollo filed a registration statement on Form S-4 and a Joint Proxy Statement/Prospectus with the SEC in connection with the proposed transaction[14] - Investors are urged to read the Registration Statement, Joint Proxy Statement/Prospectus, and other relevant documents filed with the SEC for important information about the proposed transaction[15] Second Quarter 2025 Earnings Presentation This section presents a detailed overview of Bridge Investment Group's financial and operational performance for the second quarter of 2025 Disclaimers and Forward-Looking Information This section reiterates disclaimers about the presentation not constituting an offer for securities and provides extensive details on forward-looking statements, emphasizing associated risks - The presentation does not constitute an offer or invitation to subscribe for securities and any decision to purchase securities should be based solely on information in a prospectus[23][27] - Forward-looking statements are subject to risks including the ultimate outcome of the Apollo transaction, business disruptions, personnel retention, regulatory approvals, global macro-economic environment (inflation, rising interest rates, recessionary conditions), cyber-attacks, and litigation[24][25][27] - All current period amounts presented in this presentation are preliminary and unaudited[35] 2ND Quarter 2025 overview Bridge reported a significant decrease in GAAP Net Income and Distributable Earnings for Q2 2025 year-over-year, while Gross AUM and Fee-Earning AUM saw modest increases | Metric | Q2 2025 | Q2 2024 | YoY Change % | | :----------------------------------------- | :------ | :------ | :------------- | | Total Revenue | $96.5 MM | $104.8 MM | (8)% | | GAAP Net Income (Loss) | $2.8 MM | $27.5 MM | (90)% | | Loss per share, Basic | $(0.01) | $(0.11) | 91% | | Fee Related Earnings ("FRE") to Operating Company | $28.0 MM | $35.9 MM | (22)% | | Distributable Earnings ("DE") of Operating Company | $25.7 MM | $35.5 MM | (28)% | | After-tax DE per share | $0.14 | $0.19 | (26)% | | Gross AUM | $50.2 Bn | $48.9 Bn | 3% | | Fee-Earning AUM | $21.9 Bn | $21.5 Bn | 2% | | Capital Raised | $0.5 Bn | $0.3 Bn | 59% | | Capital Deployed | $0.5 Bn | $0.4 Bn | 40% | | Dry Powder | $3.2 Bn | $3.1 Bn | 3% | | Realized Performance Allocations | $4.9 MM | $7.1 MM | (31)% | | Unrealized Accrued Performance Allocations | $328.6 MM | $338.9 MM | (3)% | - Bridge declared a dividend of $0.045 per share of its Class A common stock, anticipating the completion of the transaction with Apollo in early September 2025[41] Assets Under Management (AUM) Bridge's Gross AUM reached $50.2 billion and Fee-Earning AUM (FEAUM) reached $21.9 billion as of Q2 2025, showing modest year-over-year growth Gross AUM and Fee-Earning AUM This section details the trends and growth of Bridge's Gross Assets Under Management and Fee-Earning Assets Under Management | Metric | Q2 2025 ($ in billions) | Q2 2024 ($ in billions) | 5-Yr CAGR (2Q'20 vs 2Q'25) | | :---------------------- | :---------------------- | :---------------------- | :-------------------------- | | Gross AUM | $50.2 | $48.9 | ~19% | | Fee-Earning AUM (FEAUM) | $21.9 | $21.5 | ~18% | Fee-earning AUM drivers This section analyzes the key factors driving changes in Fee-Earning Assets Under Management, including capital raised and deployed - $476 million of capital was raised in Q2 2025, primarily driven by Credit strategies, with 97% of inflows from institutional investors and 3% from individual investors[66] - $509 million of capital was deployed in Q2 2025, mostly driven by Multifamily, Logistics, and Net Lease strategies, not including approximately $1.0 billion of recycled capital activity within Credit strategies[66] - Fee-earning AUM as of Q2 2025 was relatively flat to Q1 2025, while total AUM increased 2% quarter-over-quarter primarily due to appreciation in Secondaries, Credit, and Multifamily strategies[66] Long duration capital drives fee visibility This section highlights the long-term nature of Bridge's Fee-Earning Assets Under Management, emphasizing fee visibility and diversification - 68% of total Fee-Earning AUM (FEAUM) has a remaining duration greater than 5 years, with a weighted-average FEAUM remaining duration of 6.0 years as of June 30, 2025[81][82] - Over 97% of FEAUM is in long-term, closed-end funds with no redemption features[81] - FEAUM is diversified across strategies, with significant portions in Debt (22%), Multifamily (18%), Secondaries (17%), and Logistics (19%)[80] Revenue Analysis Total revenues for Q2 2025 decreased by 8% year-over-year to $96.5 million, and Fee Related Revenues also saw a decline Total Revenues and Fee Related Revenue This section presents an overview of Bridge's total revenues and fee-related revenues, including historical trends | Metric | LTM Q2 2025 ($ in millions) | LTM Q2 2024 ($ in millions) | 5-Yr CAGR (2Q'20 vs 2Q'25) | | :---------------------- | :-------------------------- | :-------------------------- | :-------------------------- | | Total Revenues | $398 | $408 | ~18% | | Total Fee Related Revenue | $310 | $312 | ~13% | Fee related revenue summary This section summarizes the components and drivers of fee-related revenues, including recurring fund management and transaction fees - Recurring fund management fees decreased during Q2 2025 compared to Q1 2025, largely attributed to the change in fee basis for Newbury Fund IV and dispositions in Bridge Debt Strategies Fund IV[76] - Transaction fees increased in Q2 2025 compared to Q1 2025, largely due to the timing of deployment in logistics, development (opportunity zone), and multifamily strategies[76] - The Q2 2025 decrease in total net fund-level fee revenues was driven by a reduction in management fees attributed to dispositions, fee basis conversions for Newbury Funds, and timing of transaction fees[55] Composition of Fund Management Fees This section details the sources and composition of fund management fees, categorized by fund launch year - In LTM Q2 2025, 83% of fund management fees were from funds launched in prior years, 9% from funds launched in the current year, and 1% from one-time catch-up fees[156][158] Earnings Analysis (Non-GAAP) Fee Related Earnings (FRE) to the Operating Company increased by 14% quarter-over-quarter in Q2 2025 to $28.0 million, driven by higher transaction fees and reduced administrative expenses Non-GAAP financial measures This section defines and presents Bridge's key non-GAAP financial measures, including Fee Related Earnings and Distributable Earnings | Metric | Q2 2025 ($ in thousands) | LTM Q2 2025 ($ in thousands) | | :----------------------------------------- | :----------------------- | :--------------------------- | | Fee Related Revenues | 73,234 | 310,311 | | Fee Related Expenses | (46,364) | (191,156) | | Total Fee Related Earnings | 26,870 | 119,155 | | Total Fee Related Earnings to the Operating Company | 27,970 | 119,294 | | Distributable Earnings attributable to the Operating Company | 25,725 | 103,481 | - Q2 2025 decrease in total net fund-level fee revenues was driven by a reduction in management fees attributed to dispositions, conversion of fee basis for Newbury Fund III and IV, and timing of transaction fees[55] - Q2 2025 increase in compensation and benefits was largely due to merit increases and variable compensation[56] Earnings summary This section provides a summary of Bridge's Fee Related Earnings and Distributable Earnings, highlighting quarter-over-quarter changes - Fee Related Earnings to the Operating Company in Q2 2025 increased 14% quarter-over-quarter, driven by an increase in transaction fees and fee related performance revenue, coupled with a reduction in net administrative expenses[90] - Distributable Earnings to the Operating Company increased 52% quarter-over-quarter, largely due to the timing and amount of net insurance loss[90] | Metric | Q2 2025 | Q2 2024 | | :-------------------------------- | :------ | :------ | | Total Revenues | $96.5 MM | $104.8 MM | | GAAP Net Income (Loss) | $2.8 MM | $27.5 MM | | Fee Related Earnings attributable to Operating Company | $28.0 MM | $35.9 MM | | Distributable Earnings attributable to Operating Company | $25.7 MM | $35.5 MM | Fund Performance Bridge's closed-end funds show varied performance across strategies as of June 30, 2025, with strong historical net IRRs in residential housing and challenges in Seniors Housing and Office funds Compelling fund-level track record This section showcases the historical performance of Bridge's closed-end funds, emphasizing strong returns in residential housing strategies - Bridge Multifamily V is approximately 75% called with approximately $0.6 billion of dry powder available to deploy before the end of the extended investment period in December 2025[92] - Strong performance by residential housing funds is driven by Bridge's vertical integration[93] - The returns for Total Office Funds are not presented because Bridge Office I has a negative return that results in an incalculable IRR[168] Investment Performance Summary - As of June 30, 2025 ($ in MM) This section provides a detailed summary of investment performance for various fund strategies as of June 30, 2025 | Fund Strategy | Fund Name | Investor Levered Net IRR | Investor Unlevered Net IRR | | :---------------------- | :---------------------------------- | :----------------------- | :------------------------- | | Multifamily | Bridge Multifamily I | 15.1 % | 15.1 % | | Multifamily | Bridge Multifamily V | (13.9)% | (12.9)% | | Workforce & Affordable Housing | Bridge Workforce Housing I | 9.6 % | 9.7 % | | Secondaries | Newbury Equity Partners V | 9.7 % | 8.2 % | | Seniors Housing | Bridge Seniors I | (4.7)% | (4.5)% | | Office | Bridge Office II | (21.2)% | (18.2)% | | Single-Family Rental | Bridge SFR Predecessor Fund I | 15.7 % | 15.7 % | | Debt Strategies | Bridge Debt IV | 9.3 % | 8.9 % | Notes to Performance Summary This section clarifies the methodology and scope of the presented investment performance data, including exclusions and calculation details - The investment performance presented illustrates the potential for performance-based fees to Bridge and does not reflect fund-level expenses, reserves, or reinvested capital[166] - Closed-End Funds performance excludes certain Opportunity Zone funds and funds currently raising capital, including open-ended funds[166] - Investor Levered Net IRR and Investor Unlevered Net IRR are annualized realized and unrealized internal rates of return to fee-paying fund investors, computed from inception, net of actual management fees, fund level expenses, and carried interest[166] Capitalization and Balance Sheet Bridge's balance sheet as of June 30, 2025, shows total assets of $1,178.0 million and total liabilities of $723.7 million Distributable earnings and capitalization This section presents Bridge's distributable earnings per share and key balance sheet items, including cash and total assets | Metric | Q2 2025 | | :------------------------------------------------ | :------ | | After-Tax Distributable Earnings Per Share | $0.14 | | Weighted-average shares of Class A common stock outstanding | 35,889,995 | | Balance Sheet Item | June 30, 2025 ($ in thousands) | December 31, 2024 ($ in thousands) | | :--------------------------------- | :----------------------------- | :--------------------------------- | | Cash and cash equivalents | 72,819 | 90,599 | | Marketable securities, at fair value | 14,678 | 21,119 | | Total assets | 1,177,964 | 1,247,382 | | Notes payable | 447,690 | 447,325 | | Total liabilities | 723,658 | 741,482 | | Total equity | 454,306 | 505,900 | Company Overview Bridge Investment Group is a leading vertically integrated alternative investment manager with $50.2 billion in Gross AUM, recognized for its fundraising capabilities and loyal global investor base Bridge Investment Group overview This section provides a high-level overview of Bridge Investment Group as a leading alternative investment manager with significant assets under management - Bridge is a leading vertically integrated alternative investment manager with $50.2 billion Gross AUM as of June 30, 2025[106][107] - The company was ranked 13 global private equity real estate firm for fundraising by PERE in June 2024[106] - Bridge has a loyal global investor base with approximately $15.7 billion of capital raised over the last five years (July 1, 2020, through June 30, 2025)[106][110] Bridge's differentiated approach drives results This section outlines Bridge's unique investment approach, emphasizing data-driven market selection, vertical integration, and citizenship initiatives - Bridge employs a data-driven approach to market selection, incorporating intelligence from its local ~2,250 on-the-ground colleagues and macroeconomic factors[114] - The vertically integrated model allows for control over the value chain, promotes knowledge sharing, and provides quality operating execution at a lower cost[114] - The company seeks to provide life-enhancing social & community programs at certain real estate assets and embeds citizenship initiatives, including charitable giving and diversity & inclusion, into firm governance[116] Appendix This section provides supplementary financial information, including GAAP reconciliations, historical non-GAAP measures, and a glossary of terms GAAP condensed consolidated balance sheets This section presents Bridge's condensed consolidated balance sheets in accordance with GAAP for specified periods | Balance Sheet Item | June 30, 2025 ($ in thousands) | December 31, 2024 ($ in thousands) | | :--------------------------------- | :----------------------------- | :--------------------------------- | | Cash and cash equivalents | 72,819 | 90,599 | | Total assets | 1,177,964 | 1,247,382 | | Total liabilities | 723,658 | 741,482 | | Total equity | 454,306 | 505,900 | Unaudited Historical Non-GAAP Measures This section provides unaudited historical data for key non-GAAP financial measures, including net income, Distributable Earnings, and Fee Related Earnings | Metric | Q2 2023 | Q2 2024 | Q2 2025 | | :----------------------------------------- | :------ | :------ | :------ | | Net income (loss) | $(2,760) | $27,494 | $2,792 | | Distributable Earnings attributable to the Operating Company | $35,006 | $35,487 | $25,725 | | Total Fee Related Earnings to the Operating Company | $35,094 | $35,883 | $27,970 | Unaudited Historical Reconciliation of Non-GAAP Distributable Earnings per Share This section reconciles historical non-GAAP Distributable Earnings per share to GAAP figures, detailing adjustments and calculations | Metric | Q2 2023 | Q2 2024 | Q2 2025 | | :------------------------------------------------ | :------ | :------ | :------ | | Distributable Earnings attributable to the Operating Company | $35,006 | $35,487 | $25,725 | | DE attributable to Bridge Investment Group Holdings Inc. | $8,570 | $10,675 | $8,253 | | After-tax DE available to common shareholders | $4,929 | $6,227 | $4,904 | | After-Tax Non-GAAP Distributable Earnings Per Share | $0.20 | $0.19 | $0.14 | Unaudited Historical Non-GAAP to GAAP Reconciliation This section provides a detailed reconciliation of non-GAAP financial measures to their most directly comparable GAAP equivalents - This section provides detailed adjustments to GAAP figures for items such as unrealized performance allocations, share-based compensation, and transaction and non-recurring costs to arrive at non-GAAP measures like Fee Related Earnings and Distributable Earnings[131][132] AUM Roll Forward (Unaudited) This section presents the unaudited roll-forward of Assets Under Management (AUM) and Fee-Earning AUM (FEAUM) for specified periods | AUM Roll Forward ($ in millions) | Three Months Ended June 30, 2025 | LTM June 30, 2025 | | :--------------------------------- | :------------------------------- | :---------------- | | Balance as of beginning of period | $49,350 | $48,925 | | New capital / commitments raised | 471 | 2,049 | | Distributions / return of capital | (600) | (2,077) | | Change in fair value and acquisitions | 1,010 | 1,334 | | AUM as of end of period | $50,231 | $50,231 | | % Change | 1.8 % | 2.7 % | | FEAUM Roll Forward ($ in millions) | Three Months Ended June 30, 2025 | LTM June 30, 2025 | | :--------------------------------- | :------------------------------- | :---------------- | | Balance as of beginning of period | $21,982 | $21,486 | | Increases (capital raised/deployment) | 209 | 2,120 | | Changes in fair market value | 5 | 23 | | Decreases (liquidations/other) | (292) | (1,725) | | FEAUM as of end of period | $21,904 | $21,904 | | % Change | (0.4)% | 1.9 % | FEAUM by Fund (Unaudited) This section provides an unaudited breakdown of Fee-Earning Assets Under Management by individual fund as of specified dates | Fund Name | FEAUM June 30, 2025 ($ in millions) | FEAUM June 30, 2024 ($ in millions) | | :-------------------------------- | :---------------------------------- | :---------------------------------- | | Bridge Debt Strategies Fund IV | 2,428 | 2,774 | | Bridge Multifamily Fund V | 2,239 | 2,239 | | Newbury Equity Partners Fund V | 1,951 | 1,951 | | Bridge Opportunity Zone Fund IV | 1,476 | 1,476 | | Bridge Workforce Fund II | 1,429 | 1,372 | Reconciliation of GAAP Shares of Common Stock Outstanding to Total Shares Outstanding This section reconciles GAAP shares of common stock outstanding to total shares outstanding, including participating partnership units | Share Type | Q2 2025 | | :------------------------------------------------ | :---------- | | GAAP Shares of Common Stock Outstanding | 37,357,910 | | Unvested Participating Shares of Common Stock | 9,212,419 | | Total Participating Shares of Common Stock | 46,570,329 | | Participating Partnership Units | 94,242,946 | | Unvested Participating Partnership Units | 185,698 | | Total Shares Outstanding | 140,998,973 | Reconciliation of GAAP Loss per Share to Distributable Earnings per Share This section reconciles GAAP loss per share to Distributable Earnings per share, detailing adjustments and weighted average shares | Metric | Amount ($ in thousands) | Weighted Average Shares Outstanding | Amount per Share | | :------------------------------------------------ | :---------------------- | :---------------------------------- | :--------------- | | Net loss available to Common Shareholders (GAAP) | (482) | 35,889,995 | $(0.01) | | Distributable Earnings attributable to the Operating Company | 25,725 | 141,189,394 | $0.18 | | Distributable Pre-Tax Earnings available to Common Shareholders | 6,539 | 35,889,995 | $0.18 | Non-Controlling Interests This section details the allocation of performance allocations and financial measures related to non-controlling interests - The Operating Company receives 24% to 40% of the gross performance allocations[153] | NON-GAAP FINANCIAL MEASURES | Total ($ in thousands) | Fund Management ($ in thousands) | Performance Income ($ in thousands) | | :------------------------------------------------ | :--------------------- | :------------------------------- | :---------------------------------- | | Fee Related Revenues | 73,234 | 73,234 | - | | Total Fee Related Earnings to the Operating Company | 27,970 | 27,973 | (3) | | Distributable Earnings Attributable to the Operating Company | 25,725 | 24,562 | 1,163 | Glossary This section provides definitions for key financial terms and metrics used throughout the report, including AUM, DE, and FRE - Assets Under Management (AUM) represents the sum of the fair value of assets of managed funds/vehicles, uncalled capital commitments, and assets of REFTs, not reduced by outstanding indebtedness[170] - Distributable Earnings (DE) is a key performance measure that differs from GAAP net income by excluding items like depreciation, unrealized performance allocations, and share-based compensation[170] - Fee Related Earnings (FRE) is a supplemental measure to assess profits from recurring fee-based revenues, adjusting Distributable Earnings to exclude realized performance allocations and other non-fee-related items[170][171]