Summary of BlackRock's 2026 Conference Call Company Overview - **Company**: BlackRock (NYSE: BLK) - **Industry**: Asset Management - **AUM**: Over $14 trillion, making it the largest asset manager globally [3][4] Key Financial Performance - **Organic Base Fee Growth**: Achieved a record 12% in Q4 2025, with an annual growth of 9% for the year, significantly above market expectations [3][4] - **Sustainable Growth Projection**: Expected normalized organic base fee growth of 6%-7% moving forward [5][6] Strategic Priorities for 2026 - **Integration of Acquisitions**: Focus on integrating recent acquisitions, including Global Infrastructure Partners and HPS Investment Partners, to maximize synergies [11][12] - **Fundraising Goals**: Targeting $400 billion in growth fundraising by 2030, leveraging institutional relationships and wealth channels [12][13] - **iShares Growth**: Continued double-digit organic growth in ETFs, with $530 billion of organic asset growth in 2025 [13][14] - **Technology and Data**: Aiming for mid-teens annual contract value (ACV) growth in the Aladdin business, which finished 2025 at 16% ACV [14][15] - **Wealth Management Expansion**: Significant opportunities in wealth management, particularly in integrating private markets into wealth platforms [15][16] Market Trends and Opportunities - **Consolidation in Asset Management**: The top five asset managers are capturing approximately 80% of industry flows, indicating a trend towards consolidation [6][7] - **Digital Wallets and Crypto**: BlackRock sees digital wallets as a new distribution channel, with 820 million crypto wallets holding significant economic value [22][23][26] - **Tokenization of ETFs**: Plans to tokenize ETF offerings to tap into the growing digital wallet ecosystem [29][30] Systematic Active Equity Business - **Strong Demand**: Experienced $50 billion in inflows into systematic strategies, highlighting a shift in the perception of scale as a driver of alpha [40][43] - **Diverse Product Offering**: Growth across multiple products, including active ETFs and hedge funds, contributing to systematic flows [45][46] M&A Strategy - **Focus on Integration**: Current emphasis on integrating recent acquisitions rather than pursuing new large-scale M&A [66][67] - **Selective Acquisitions**: Open to smaller, accretive transactions that align with growth in private markets and technology [66][67] Operating Margins - **Current Margin Performance**: Achieved an adjusted operating margin of 45% in Q4 2025, with expectations to maintain or exceed this level [59][61] - **Long-term Margin Goals**: Potential to grow fully burdened operating margins above 45% through strategic investments and organic growth [61][62] White Space Opportunities - **Expansion Areas**: Identified opportunities in secondaries, investment-grade finance, and data completion related to Preqin [69][71] Conclusion - BlackRock is well-positioned for continued growth through strategic integration of acquisitions, expansion in wealth management, and leveraging technology in asset management. The focus on digital wallets and tokenization reflects a forward-looking approach to evolving market dynamics.

Group 1 - The core idea is that GDP growth in the future will be directly related to the computational power generated per dollar spent on energy [2][26] - Microsoft CEO Satya Nadella emphasized the importance of efficient computational power and its relationship with energy costs, stating that the pricing of computational power halves every three months [4][27] - Nadella highlighted that Europe must focus on leveraging its products to meet global demand rather than solely ensuring internal security, advocating for a combination of local development and global thinking [4][28] Group 2 - Nadella warned against the potential AI bubble, suggesting that AI's benefits must extend beyond the tech sector to industries like pharmaceuticals and finance to ensure sustainable growth [4][19] - Microsoft is not currently the most recognized "AI winner," as Nadella is rethinking the company's business model in the AI era, hiring experts to assist in this transition [5][24] - Large organizations face significant management challenges in adapting to AI, requiring a shift in leadership mindset and a reorganization of workflows to leverage AI effectively [6][21] Group 3 - The concept of "AI sovereignty" is crucial, with companies needing to embed their unique knowledge and proprietary data into their models to maintain control and prevent value loss [6][30] - Nadella believes that in a multi-model world, the competitive advantage lies in the ability to orchestrate various models and data to create unique AI capabilities [6][31] - The discussion highlighted the need for both private and public sector leadership to ensure the equitable diffusion of AI technology across different economies [14][17] Group 4 - Nadella pointed out that the current energy and computational power landscape is critical for economic growth, with a focus on reducing energy costs to enhance competitiveness [26][27] - The conversation addressed the disparities in AI adoption between developed and developing countries, noting that the commitment to using AI technology is becoming more uniform globally [25][26] - Nadella emphasized that the future of AI will not be dominated by a single model, but rather a diverse ecosystem of models that organizations can leverage for their specific needs [31][32]

Financial Data and Key Metrics Changes - BlackRock reported full-year revenue of $24 billion, up 19% year-over-year, with operating income of $9.6 billion, an 18% increase, and earnings per share (EPS) of $48.09, which increased by 10% [7][8] - Q4 revenue reached $7 billion, a 23% increase year-over-year, driven by acquisitions and organic base fee growth [7][8] - The company achieved nearly $700 billion in net new assets for the year, with a 9% organic base fee growth and a 16% technology annual contract value (ACV) expansion [3][4] Business Line Data and Key Metrics Changes - Q4 base fees and securities lending revenue totaled $5.3 billion, up 19% year-over-year, supported by market beta impacts and organic growth [9] - Performance fees for Q4 were $754 million, reflecting higher revenue from alternatives, including $158 million from HPS [10] - Technology services and subscription revenue increased by 24% year-over-year, with annual contract value (ACV) rising 31% [10] Market Data and Key Metrics Changes - iShares led the industry with $527 billion in net inflows for 2025, representing 12% organic asset growth [14] - Full-year retail net inflows were $107 billion, driven by significant assignments and strong performance in various asset classes [15] - BlackRock's institutional active franchise generated net inflows of $54 billion, while institutional index net outflows were $119 billion, primarily from low-fee index equity strategies [15] Company Strategy and Development Direction - BlackRock aims to build leading franchises in high-growth markets, including private markets, digital assets, and active ETFs, targeting $500 million revenue generators in the next five years [6] - The company plans to raise $400 billion in gross private markets fundraising by 2030, leveraging strong client relationships and investment performance [15][22] - BlackRock is focused on integrating public and private markets, enhancing its technology and data capabilities through platforms like Aladdin and Preqin [6][35] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the growth trajectory, with a strong pipeline of business across products and regions, and a commitment to delivering durable, profitable growth [18][20] - The company anticipates continued organic base fee growth of 6% or higher, supported by structural growth strategies and favorable market conditions [40] - Management highlighted the importance of cash management and the potential for elevated cash holdings as global capital markets grow [45][47] Other Important Information - BlackRock returned a record $5 billion to shareholders in 2025 through dividends and share repurchases, with a 10% increase in the dividend per share planned for Q1 2026 [13][21] - The company is integrating Preqin to enhance its private market data capabilities and aims to create investable indices for private markets [80][82] Q&A Session Summary Question: What is the outlook for net flow pipeline and the money market business? - Management noted that organic base fee growth continues to outperform expectations, with a diversified fundraising plan for 2026 [40][41] - They expect money market yields to fall with rate cuts, but anticipate strong demand for fixed income offerings [42][43] Question: How is BlackRock prioritizing growth in Asia? - Management highlighted the rapid growth of capital markets in Asia, particularly in Japan and India, and the opportunities for self-directed retirement platforms [51][52][55] Question: How does BlackRock differentiate in the insurance channel? - Management emphasized their full-service capabilities and strong relationships with insurance companies, positioning them well for growth in private credit and high-grade portfolios [61][65] Question: What is the outlook for operating margins in 2026? - Management targets a 45% or greater adjusted operating margin, with expectations for margin expansion driven by strong growth in private markets and technology [69][71]

Financial Data and Key Metrics Changes - BlackRock reported full-year revenue of $24 billion, up 19% year-over-year, with operating income of $9.6 billion, an 18% increase, and earnings per share (EPS) of $48.09, which increased by 10% [7][8] - Fourth-quarter revenue reached $7 billion, a 23% increase year-over-year, driven by acquisitions and organic base fee growth [7][8] - The company achieved nearly $700 billion in net new assets for the year, with a 9% organic base fee growth and a 16% technology annual contract value (ACV) expansion [3][4] Business Line Data and Key Metrics Changes - The fourth-quarter base fees and securities lending revenue totaled $5.3 billion, up 19% year-over-year, supported by market beta impacts and organic growth [9] - Performance fees for the fourth quarter were $754 million, reflecting higher revenue from alternatives [10] - Technology services and subscription revenue increased by 24% year-over-year, with ACV growing 31% [10] Market Data and Key Metrics Changes - iShares led the industry with $527 billion in net inflows for 2025, representing 12% organic asset growth [13] - Retail net inflows for the year were $107 billion, significantly boosted by a $80 billion SMA assignment from Citi Wealth [14] - Institutional active franchise generated net inflows of $54 billion, while institutional index net outflows were $119 billion, primarily from low-fee index equity strategies [14] Company Strategy and Development Direction - BlackRock is focusing on building leading franchises in high-growth markets such as private markets, digital assets, and active ETFs, targeting $500 million revenue generators in the next five years [6] - The company aims to raise $400 billion in private markets by 2030, leveraging its strong client relationships and investment performance [19] - BlackRock is integrating public and private markets through technology and data, positioning itself as a leader in the evolving asset management model [6][30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's growth trajectory, with expectations of continued organic base fee growth of 6% or higher [5][33] - The company anticipates a favorable operating environment, with a focus on delivering better outcomes for clients and enhancing shareholder value [31] - Management highlighted the importance of adapting to market changes and leveraging technology to drive future growth [30][56] Other Important Information - BlackRock returned a record $5 billion to shareholders in 2025 through dividends and share repurchases, with a 10% increase in the dividend per share planned for 2026 [12][13] - The company is targeting a mid-single-digit percentage increase in general and administrative expenses for 2026, while maintaining a flat headcount [12][52] Q&A Session Summary Question: What is the outlook for net flow pipeline and the money market business? - Management noted that organic base fee growth continues to outperform expectations, with a strong pipeline in private markets and systematic strategies [32][33] - Regarding the money market business, they expect flows to be affected by rate cuts, but anticipate opportunities in intermediate-term bonds [34][35] Question: How is BlackRock prioritizing growth in Asia? - Management highlighted the rapid growth of capital markets in Asia, particularly in Japan and India, and emphasized the potential for self-directed retirement platforms [40][41] Question: How does BlackRock differentiate in the insurance channel? - The company is the largest insurance company general account manager, focusing on delivering customized solutions and integrating public and private portfolios [43][44]

Financial Data and Key Metrics Changes - BlackRock reported nearly $700 billion in net new assets for 2025, with a 9% organic base fee growth and a 16% technology annual contract value (ACV) expansion [3][4] - Full year revenue reached $24 billion, up 19% year over year, while operating income was $9.6 billion, an 18% increase [8] - Earnings per share (EPS) for the full year was $48.09, reflecting a 10% increase [8] Business Line Data and Key Metrics Changes - Fourth quarter base fees and securities lending revenue amounted to $5.3 billion, a 19% increase year over year, driven by market beta impacts and organic growth [10] - Performance fees in the fourth quarter were $754 million, up from the previous year, with significant contributions from alternatives [11] - Technology services and subscription revenue increased by 24% year over year, reflecting successful client onboarding and the closing of the Preqin transaction [11] Market Data and Key Metrics Changes - iShares led the industry with $527 billion in net inflows for 2025, representing 12% organic asset growth [15] - Retail net inflows for the year were $107 billion, significantly boosted by a $80 billion SMA assignment from Citi Wealth [16] - Institutional active franchise generated net inflows of $54 billion, while institutional index net outflows were $119 billion, primarily due to low-fee index equity strategy redemptions [16] Company Strategy and Development Direction - BlackRock aims to build leading franchises in high-growth markets such as private markets, digital assets, and active ETFs, targeting $500 million revenue generators in the next five years [6][7] - The company plans to raise $400 billion in private markets by 2030, leveraging strong client relationships and investment performance [22] - BlackRock is focused on integrating public and private markets, enhancing its technology and data capabilities through platforms like Aladdin and Preqin [7][34] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2026, citing strong client relationships and a diversified pipeline across products and regions [18][19] - The company anticipates continued organic base fee growth of 6% or higher, supported by a favorable market environment [38] - Management highlighted the importance of adapting to changing market conditions and the potential for increased cash holdings as capital markets grow [42][43] Other Important Information - BlackRock returned a record $5 billion to shareholders in 2025 through dividends and share repurchases, with a planned 10% increase in the dividend per share for 2026 [13][14] - The company is targeting a $1.8 billion share repurchase program for 2026 [15] - BlackRock's platform is positioned to capture flows with strong performance across various asset classes, including fixed income and active ETFs [28][29] Q&A Session Summary Question: What is the outlook for net flow pipeline and the money market business? - Management noted that organic base fee growth has consistently outperformed expectations, with a strong pipeline for private markets and systematic strategies [37] - They expect money market yields to fall with potential rate cuts, but anticipate continued demand for fixed income offerings [39][40] Question: How is BlackRock prioritizing growth in Asia? - Management highlighted the rapid growth of capital markets in Asia, particularly in Japan and India, and emphasized the potential for self-directed retirement platforms [45][46] Question: How does BlackRock differentiate in the insurance channel? - BlackRock is the largest general account manager for insurance companies, focusing on delivering customized solutions and integrating public and private portfolios [50][52]

Core Insights - Kirsty Craig has been recognized as a Tech Fellow at BlackRock, highlighting her significant contributions to the firm's investment technology and AI strategy [2][8] - Craig's work focuses on the development of Asimov, an AI platform designed to enhance the firm's fundamental equity business by automating workflows and research processes [3][7] - BlackRock continues to emphasize technological innovation as a key component of its strategy to manage $13.5 trillion in assets [3][4] Group 1: Recognition and Role - Craig is one of five new Tech Fellows at BlackRock, a distinction awarded to only a select few within the firm [2] - She is the only woman and the only fellow not directly working within the Aladdin platform, which is central to BlackRock's data analytics and risk management [2][5] - Her team consists of around 60 professionals, including software engineers and data scientists, who collaborate across various investment capabilities [5] Group 2: Impact on AI and Investment - The Asimov platform, which Craig helped develop, represents a significant advancement in how BlackRock utilizes AI to streamline investment processes [3][7] - Craig's collaborative approach and innovative mindset have positioned her team at the forefront of applying AI in investment strategies [7] - The recognition of Craig as a Tech Fellow underscores the importance of integrating technology and investment research within the asset management industry [2][8]

Core Insights - BlackRock has inducted five new members into its Tech Fellows program, which now consists of 24 senior technologists who play a vital role in the firm's operations and vision within the $13.5 trillion asset management industry [1][7]. Group 1: Tech Fellows Program - The new members underwent a rigorous selection process, including nominations, written evaluations, and interviews, before being voted in by current fellows [2]. - The program aims to combine technical expertise, domain knowledge, and a commercial mindset to enhance the firm's culture and technological capabilities [3]. - The Tech Fellows are expected to mentor other technologists and contribute to the firm's engineering culture through various initiatives [3][6]. Group 2: Technological Influence and Growth - The influence of technologists on Wall Street is increasing as firms, including BlackRock, adopt AI technologies [4]. - BlackRock's technology services and subscription revenue grew by 28% year-on-year in the last quarter, driven by its Aladdin platform and the integration of Preqin's private-markets data business [4]. - As of 2023, one in every three BlackRock employees is a software engineer or technologist, indicating a significant emphasis on technology within the firm [5].

Summary of BlackRock Conference Call - December 09, 2025 Company Overview - **Company**: BlackRock (NYSE: BLK) - **Assets Under Management**: $13.5 trillion - **Growth Target**: Plans to double the business by 2030 - **Current Growth**: Organic base fee growth at 8% for the last 12 months, exceeding the 5% target [10][12][20] Key Points and Arguments Financial Performance - **Organic Base Fee Growth**: Achieved 8% growth, with expectations for continued strong performance into Q4 2025 [12][20] - **iShares Flows**: Approximately $100 billion in iShares flows for Q4, totaling $450 billion for the year, setting an annual record [21] - **Private Markets**: $16 billion in private markets through Q3, with a strong pipeline for Q4 [22] - **Revenue Growth Strategy**: Focus on structural growth engines such as SMAs, models, systematic equities, and digital assets, aiming for 6-7% organic base fee growth in the future [24][25] Market Trends and Strategic Shifts - **Total Portfolio Approach (TPA)**: Shift from traditional strategic asset allocation to TPA, allowing for more nimble investment strategies [70][72] - **Institutional Investor Trends**: Notable movement among large institutional investors, including CalPERS, towards TPA, indicating a significant market shift [72][78] Acquisitions and Integration - **HPS Investment Partners**: Integration has led to increased origination opportunities and a larger pipeline for credit investments [81][87] - **Credit Market Conditions**: Current credit conditions remain stable, with non-accruals and recovery rates in line with historical norms [88][90] Product Development and Innovations - **New Product Launches**: Plans to develop a family of retail alternative funds and expand private market offerings [109][110] - **401(k) Opportunities**: Target date funds with private market allocations expected to launch in 2026, aiming to bring private market exposure to defined contribution plans [126][127] Digital Assets and Tokenization - **Tokenization Strategy**: Focus on bridging traditional finance with decentralized finance (DeFi), including plans to tokenize iShares and develop digital wallet capabilities [139][143] - **Stablecoin Management**: Managing approximately $65 billion in Circle Stablecoin, with expectations for significant growth in digital wallets and tokenized assets [140][142] Additional Important Insights - **Expense Management**: BlackRock aims for adjusted operating margins of 45% or greater, with a focus on aligning organic revenue growth with controllable expenses [49][52] - **Market Conditions**: Anticipation of increased default rates in the credit market, particularly among smaller companies, while larger companies are expected to perform better [92][96] This summary encapsulates the key insights and strategic directions discussed during the BlackRock conference call, highlighting the company's robust growth trajectory, market adaptations, and innovative product developments.

Core Insights - BlackRock Inc. (BLK) has formed a strategic partnership with AccessFintech (AFT) to enhance bilateral connectivity and real-time post-trade collaboration in financial markets [1][8] - BLK has also made a strategic investment in AFT to support its growth in product development, global expansion, and ecosystem integration [2] Collaboration Details - The partnership aims to integrate AccessFintech with BlackRock's Aladdin platform, providing secure, API-driven connections between buy-side firms and their sell-side partners, asset servicers, and market infrastructure [3] - Benefits for Aladdin clients include real-time transparency into trade lifecycle events, direct collaboration with brokers and custodians, access to cross-asset data, and AI-powered predictive analytics, all without altering existing infrastructure [4] Operational Efficiency - The collaboration enhances the ability of sell-side firms and asset servicers to connect with buy-side clients on the Aladdin platform, improving exception resolution and transparency for better client outcomes [5] - Michael Debevec, head of global investment operations at BlackRock, emphasized that the partnership accelerates BlackRock's strategy by integrating real-time data across the post-trade lifecycle, leading to improved workflow and risk management [6] Market Context - Year to date, BlackRock's shares have decreased by 0.5%, contrasting with a 19.1% decline in the industry [7]

Core Insights - BlackRock's assets under management reached $13.46 trillion in Q3 2025, up from $11.48 trillion a year earlier, indicating a rapid integration of traditional finance with digital assets [1][2][4] - CEO Larry Fink emphasized the potential of tokenizing traditional investment products, which could attract new investors to the crypto market, marking a significant opportunity for BlackRock [2][3] - The firm's iShares Bitcoin Trust (IBIT) has become the top-earning ETF, generating $244.5 million annually, with assets nearing $100 billion in under 450 days, showcasing the growing institutional interest in Bitcoin ETFs [6] Financial Performance - BlackRock reported long-term net inflows of $171 billion, with revenue rising to $6.5 billion, reflecting an 8% increase in organic base fees [4] - Total expenses increased to $4.6 billion, while private-market inflows reached $13.2 billion and retail inflows rose to $9.7 billion [4] - Technology revenue surged by 28% to $515 million, driven by the Aladdin system, which is increasingly utilized for managing tokenized portfolios [5] Market Trends - Digital-asset exposure in BlackRock's funds has tripled since 2024, indicating a significant rise in demand for Bitcoin ETFs and tokenization initiatives [3] - Fink compared the role of crypto to that of gold, highlighting its function as an alternative store of value amid growing institutional demand [3] - Bitcoin ETFs are projected to attract $30 billion this quarter, reflecting Wall Street's increasing control over crypto liquidity [6]