Blue Owl Capital (US:OWL)2025-11-03 21:43Financial Performance - As of September 30, 2025, Blue Owl Capital Inc. reported a net income of $6.31 million for the third quarter and $31.17 million for the nine months ended September 30, 2025, compared to $29.81 million and $88.84 million for the same periods in 2024, respectively [24]. - Total revenues for the three months ended September 30, 2025, increased to $727.99 million, up $127.11 million from $600.88 million in the same period of 2024 [66]. - Total revenues for the nine months ended September 30, 2025, increased to $2,114,582,000, up $450,516,000 or 27% from $1,664,066,000 in 2024 [77]. - Consolidated net income attributable to Blue Owl Capital Inc. decreased to $6.31 million, down $23.50 million from $29.81 million in the same quarter of 2024 [66]. - Consolidated net income for the three months ended September 30, 2025, was $47,373 thousand, compared to $99,324 thousand in the same period of 2024, reflecting a decrease of 52.3% [187]. - Net income attributable to Blue Owl Capital Inc. for the nine months ended September 30, 2025, was $31,166,000, down $57,675,000 from $88,841,000 in 2024 [77]. Fee-Related Earnings - Fee-related earnings for the third quarter of 2025 were $376.18 million, up from $326.86 million in the third quarter of 2024, representing a growth of approximately 15.1% [24]. - Fee-Related Earnings for the three months ended September 30, 2025, increased by $49,313,000 to $376,175,000, attributed to higher FRE revenues [93]. - Fee-Related Earnings for the nine months ended September 30, 2025, increased by $166.9 million to $1,079.9 million, up from $913.0 million in 2024 [100]. Assets Under Management (AUM) - Total assets under management (AUM) reached $295.6 billion as of September 30, 2025, with $183.8 billion classified as fee-paying AUM (FPAUM) [25][27]. - AUM not yet paying fees totaled $28.4 billion, which could provide approximately $361 million of annualized management fees once deployed [27][40]. - The increase in AUM for the nine months ended September 30, 2025, was driven by $15.4 billion of new capital raised, primarily in direct lending products [46]. - The IPI Acquisition contributed $14.2 billion to the increase in AUM, along with $10.9 billion raised across various products, including the Blue Owl Real Estate Net Lease Trust [47]. Capital Raising and Deployment - The company raised $14.4 billion in new capital commitments during the third quarter of 2025, contributing to a record total of $57.0 billion raised over the last twelve months [31]. - Blue Owl's direct lending strategy saw gross deployment of $46.8 billion and net funded deployment of $12.1 billion over the last twelve months, with an increase in new origination activity in the third quarter [32]. - The company raised $4.0 billion in new capital primarily in the GP minority stakes strategy during the nine months ended September 30, 2025 [50]. Expenses and Liabilities - Management fees rose to $645.66 million, an increase of $122.35 million compared to $523.31 million in the prior year [66]. - Compensation and benefits expenses increased by $70.27 million, totaling $341.37 million, compared to $271.11 million in the previous year [66]. - Interest expense rose to $42.35 million, an increase of $8.25 million compared to $34.10 million in the prior year [66]. - Total liabilities rose to $6,290,750 thousand as of September 30, 2025, compared to $5,186,434 thousand at December 31, 2024, marking an increase of 21.3% [180]. Shareholder Information - The target annual dividend for fiscal year 2025 is set at $0.90 per Class A Share, with a quarterly dividend of $0.225 declared for Q3 2025 [127]. - Cash dividends declared on Class A Shares increased to $0.225 per share for the three months ended September 30, 2025, compared to $0.180 per share in the same period of 2024, marking a rise of 25% [191]. - The number of Class A Shares outstanding as of September 30, 2025, was 664.80 million, compared to 568.25 million a year earlier, indicating an increase of 16.9% [191]. Cash Flow and Liquidity - Net cash provided by operating activities increased to $873.2 million for the nine months ended September 30, 2025, up from $675.5 million in 2024, a change of $197.6 million [134]. - Cash flows from investing activities improved by $308.2 million, with outflows of $283.7 million in 2025 compared to $591.9 million in 2024 [134]. - The company anticipates that its current liquidity position will be sufficient to meet working capital needs for at least the next 12 months [111]. Acquisitions and Mergers - The company completed a merger on January 13, 2025, with OBDC as the surviving company, which may impact future performance metrics [55]. - The company completed several acquisitions, including the IPI Acquisition on January 3, 2025, enhancing its investment management capabilities [208]. Market Conditions and Risks - Adverse market conditions, including inflation and interest rate increases, may negatively impact liquidity and cash flows from management fees [133]. - An increase or decrease in interest rates by 100 basis points is not expected to have a material impact on the company's interest expense [156].