KKR (NYSE:KKR) Q4 2025 Earnings call February 05, 2026 09:00 AM ET Company ParticipantsAlex Blostein - Managing DirectorBenjamin Budish - DirectorBrian Bedell - DirectorCraig Larson - Partner and Head of Investor RelationsCraig Siegenthaler - Managing DirectorMichael Cyprys - Managing DirectorPatrick Davitt - PartnerRob Lewin - CFOScott Nuttall - Co-CEOConference Call ParticipantsArnaud Giblat - Managing Director and Research AnalystBill Katz - Senior Equity AnalystBrennan Hawken - Senior Equity Research An ...

KKR (NYSE:KKR) Q4 2025 Earnings call February 05, 2026 09:00 AM ET Company ParticipantsAlex Blostein - Managing DirectorBenjamin Budish - DirectorBrian Bedell - DirectorCraig Larson - Partner and Head of Investor RelationsCraig Siegenthaler - Managing DirectorMichael Cyprys - Managing DirectorPatrick Davitt - PartnerRob Lewin - CFOScott Nuttall - Co-CEOConference Call ParticipantsArnaud Giblat - Managing Director and Research AnalystBill Katz - Senior Equity AnalystBrennan Hawken - Senior Equity Research An ...

KKR (NYSE:KKR) Q4 2025 Earnings call February 05, 2026 09:00 AM ET Speaker1Ladies and gentlemen, thank you for standing by. Welcome to KKR's fourth quarter 2025 earnings conference call. During today's presentation, all parties will be in a listen-only mode. Following management's prepared remarks, the conference will be open for questions. If anyone should require operator assistance during the conference, please press star 0 on your telephone keypad. As a reminder, this conference is being recorded. I wil ...

Core Insights - The total dollar value of continuation funds is projected to reach $100 billion by the end of 2025, a significant increase from $35 billion in 2019, indicating a growing trend in private equity practices [1][2] - Continuation funds allow private equity firms to sell portfolio companies from one fund to another managed by the same firm, often at the end of the original fund's lifecycle, providing limited partners (LPs) the option to reinvest or cash out [2][6] - The median holding period for portfolio companies has extended to almost six years in 2025, the longest in 25 years, reflecting a slowdown in selling activity despite ongoing acquisitions [3] Continuation Funds Dynamics - Continuation funds have gained popularity as private equity firms seek to return promised returns to LPs, with many LPs opting to cash out rather than reinvest [2][6] - The motivations for establishing continuation funds have evolved, with firms now using them for well-performing assets rather than just hard-to-divest ones, aiming for better selling prices [7][8] - Critics highlight governance concerns, as continuation funds can create conflicts of interest between exiting and incoming investors, particularly when a significant majority of existing investors prefer cashing out [10][11] Legal and Regulatory Context - A legal case in the Delaware Court of Chancery involving a private equity firm and a foreign investor may impact the future of continuation funds, with potential outcomes that could either encourage or hinder their use [6][12] - The lack of stringent regulation around continuation funds raises concerns, although recent SEC rules aimed at addressing conflicts of interest have been stalled due to political changes [14][15] Implications for Portfolio Companies - Being included in a continuation fund may signal ongoing investment interest from private equity sponsors, potentially leading to additional capital infusion and increased scrutiny of portfolio companies [16][17] - Management teams may view this as a positive sign, indicating confidence in the business's prospects, but it may also result in heightened involvement from private equity owners [17]

Group 1: Market Overview - The "office of the CFO software market" is projected to grow from $71 billion in 2023 to $131 billion in 2028, indicating significant expansion opportunities [3]. - OneStream, a major player in this market, has agreed to be acquired by Hg for $6.4 billion, highlighting ongoing consolidation trends within the industry [3]. Group 2: Company Developments - Datarails raised $70 million in Series C funding, bringing its total funding to $175 million, aimed at geographic expansion and product portfolio enhancement [5][9]. - The company reported a 70% year-over-year revenue growth last year, with its workforce nearly doubling to over 400 employees [5]. Group 3: Product Innovations - Datarails is evolving its software tools from a focus on financial planning and analysis to a comprehensive finance platform, with over 50% of its growth in 2025 attributed to products launched in the past year [6]. - New products being introduced include AI finance agents for strategy, planning, and reporting, which assist finance professionals in generating board-ready materials [7]. - Upcoming releases include "AI in Excel" and "Spend Control," aimed at enhancing financial management capabilities [8].

Core Insights - OneStream is going private just 17 months after its IPO, highlighting challenges in the public market despite initial success [1][2] - The IPO market is open but companies face significant valuation reductions, with examples like Navan and JAMF illustrating the harsh realities of current market conditions [6][12][21] Company Performance - OneStream had a valuation of $6 billion at its IPO, but is being acquired for $6.4 billion, reflecting a 31% premium despite a 35% drop from its IPO highs [2][3] - Navan, with a current trading price of $17, is 32% below its IPO price of $25, trading at 4x ARR, indicating a tough market for non-AI B2B software [6][21] - JAMF, despite tripling its ARR from $225 million to $710 million, was acquired for $2.2 billion, which is less than half its initial IPO valuation, due to a significant slowdown in growth [9][20] Market Dynamics - The median public SaaS multiples have reset to 6-7x ARR, reflecting a return to 2016-2017 levels, with a widening gap between top and bottom performers [13][14] - Private equity investment in enterprise software has increased by 28% year-to-date in 2025, as PE firms can operate profitably at lower multiples [14][21] Investment Considerations - Companies need to achieve 25-40% growth to command premium multiples; those growing below 20% are likely to receive valuations of 3-7x ARR [15][23] - GAAP profitability is becoming increasingly important, with investors now seeking both growth and profitability, contrasting with previous years where growth alone sufficed [16][21] - The timeline to IPO is longer than anticipated, as seen with Navan's delayed public offering and OneStream's brief public tenure [17][21] Future Outlook - The IPO window is not closed but is characterized by a more realistic assessment of company valuations, particularly for those not in the AI sector [19][22] - Companies achieving 30%+ growth with GAAP profitability may still find favorable IPO conditions, while others may face acquisition at lower multiples by private equity [23]

Core Insights - Hg has acquired OneStream for an equity value of approximately $6.4 billion, marking a return to private ownership just 17 months after its IPO, reflecting changing dynamics in the tech sector amid economic uncertainties [1][3] - OneStream provides an AI-enabled platform for enterprise finance management, serving major clients like Toyota and UPS, and competes with industry leaders such as Oracle and SAP [2][9] Company Overview - OneStream, founded in 2010, has evolved from Oracle's Hyperion technology into a unified system for streamlining financial processes for large organizations [3] - The company went public in July 2024 with an initial valuation near $6 billion but saw its market cap decline to about $4.48 billion by early January 2026 due to softer macroeconomic conditions [3] Acquisition Details - Hg will become the majority voting shareholder, with minority stakes held by General Atlantic and Tidemark, while KKR exits its position entirely [5] - The acquisition offers OneStream shareholders $24 per share, representing a 31% premium over the January 5, 2026 closing price and a 27% uplift from the 30-day volume-weighted average [5] Strategic Implications - Leadership continuity is assured with CEO Tom Shea remaining in charge, allowing OneStream to focus on AI-driven innovations without public market pressures [6] - Hg's involvement is expected to enhance OneStream's growth trajectory and AI capabilities, aligning with broader trends in fintech where AI integration is driving consolidation [6][8] Market Response - Following the announcement, OneStream shares surged over 28%, indicating a positive market reaction [7] - Analysts view the acquisition as a vote of confidence in OneStream's platform, suggesting it could reshape the competitive landscape and enable the company to capture more market share [9]

Core Insights - The private markets are experiencing a shift towards larger firms, with a focus on differentiation and scale for survival [2] - Private equity is expected to see a 20% increase in transaction volume in 2026 compared to 2025, driven by favorable market conditions [3] - Venture capital is consolidating around mega-funds and niche specialists, leaving generalist firms at risk [4] Private Equity - In 2026, private equity firms will prioritize capital return over capital growth, leading to increased M&A and IPO activity [3] - The decline in interest rates is expected to enhance liquidity and market activity, with a more stable environment for long-term value creation [3] - Sectors with defensive demand and operational upside will attract more capital, with returns driven by execution rather than multiple expansion [3] Venture Capital - Major venture firms are expected to launch mutual funds to gather more assets, capitalizing on regulatory changes [4] - The "generalist middle" is collapsing, with capital consolidating around larger funds and niche specialists [4] - LPs will have increased negotiating power due to a smaller number of active allocators, impacting fundraising for emerging managers [5] Startups - Many AI startups are facing challenges due to market saturation and price wars, with few expected to succeed [6] - Founders are advised to focus on operational discipline and fundamentals as the market resets [6] - A significant increase in startup formation and product releases is anticipated, driven by easier access to technology [6] Recent Deals - xAI raised $20 billion in Series E funding, indicating strong investor interest in AI [8] - Hg is acquiring OneStream for approximately $6.4 billion, highlighting ongoing consolidation in the private equity space [10] - PicPay filed for an IPO on Nasdaq, reporting $1.7 billion in revenue for the year ending September 30 [16] Funds - BV Investment Partners raised $2.5 billion for its seventh fund, focusing on business services and IT sectors [17]

Core Viewpoint - Private equity firm Hg is set to take financial software manufacturer OneStream private, with a transaction valuation of approximately $6.4 billion [1] Group 1 - OneStream shareholders will receive $24 in cash per share, representing a 31% premium over the closing price on Monday [1] - The transaction is expected to be completed in the first half of 2026 [1]

Company Overview - Proactive is a financial news publisher that provides fast, accessible, informative, and actionable business and finance news content to a global investment audience [2] - The company has a team of experienced and qualified news journalists who produce independent content [2] Market Focus - Proactive specializes in medium and small-cap markets while also covering blue-chip companies, commodities, and broader investment stories [3] - The content delivered includes insights across various sectors such as biotech and pharma, mining and natural resources, battery metals, oil and gas, crypto, and emerging digital and EV technologies [3] Technology Adoption - Proactive is recognized for its forward-looking approach and enthusiastic adoption of technology to enhance workflows [4] - The company utilizes automation and software tools, including generative AI, while ensuring that all content is edited and authored by humans [5]