BlackRock, Inc.: Form 10-Q for the period ended Jun 30, 2025

FORWARD-LOOKING STATEMENTS

This report, and other statements that BlackRock may make, may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act, with respect to BlackRock’s future financial or business performance, strategies or expectations. Forward-looking statements are typically identified by words or phrases such as “trend,” “potential,” “opportunity,” “pipeline,” “believe,” “comfortable,” “expect,” “anticipate,” “current,” “intention,” “estimate,” “position,” “assume,” “outlook,” “continue,” “remain,” “maintain,” “sustain,” “seek,” “achieve,” and similar expressions, or future or conditional verbs such as “will,” “would,” “should,” “could,” “may” and similar expressions.

BlackRock cautions that forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time and may contain information that is not purely historical in nature. Such information may include, among other things, projections and forecasts. There is no guarantee that any forecasts made will come to pass. Forward-looking statements speak only as of the date they are made, and BlackRock assumes no duty to and does not undertake to update forward-looking statements. Actual results could differ materially from those anticipated in forward-looking statements and future results could differ materially from historical performance.

BlackRock has previously disclosed risk factors in its Securities and Exchange Commission reports. These risk factors and those identified elsewhere in this report, among others, could cause actual results to differ materially from forward-looking statements or historical performance and include: (1) the introduction, withdrawal, success and timing of business initiatives and strategies; (2) changes and volatility in political, economic or industry conditions, the interest rate environment, foreign exchange rates or financial and capital markets, which could result in changes in demand for products or services or in the value of assets under management (“AUM”); (3) the relative and absolute investment performance of BlackRock’s investment products; (4) BlackRock’s ability to develop new products and services that address client preferences; (5) the impact of increased competition; (6) the impact of recent or future acquisitions or divestitures, including the acquisitions of Global Infrastructure Management, LLC (“GIP” or the “GIP Transaction”), Preqin Holding Limited (“Preqin” or the “Preqin Transaction”) and HPS Investment Partners (“HPS” or the “HPS Transaction” and together with the GIP Transaction and the Preqin Transaction, the “Transactions”); (7) BlackRock’s ability to integrate acquired businesses successfully, including the Transactions; (8) the unfavorable resolution of legal proceedings; (9) the extent and timing of any share repurchases; (10) the impact, extent and timing of technological changes and the adequacy of intellectual property, data, information and cybersecurity protection; (11) the failure to effectively manage the development and use of artificial intelligence; (12) attempts to circumvent BlackRock’s operational control environment or the potential for human error in connection with BlackRock’s operational systems; (13) the impact of legislative and regulatory actions and reforms, regulatory, supervisory or enforcement actions of government agencies and governmental scrutiny relating to BlackRock; (14) changes in law and policy and uncertainty pending any such changes; (15) any failure to effectively manage conflicts of interest; (16) damage to BlackRock’s reputation; (17) increasing focus from stakeholders regarding environmental and social-related matters; (18) geopolitical unrest, terrorist activities, civil or international hostilities, and other events outside BlackRock’s control, including the Middle East conflicts, wars, global trade tensions, tariffs, natural disasters and health crises, which may adversely affect the general economy, domestic and local financial and capital markets, specific industries or BlackRock; (19) climate-related risks to BlackRock’s business, products, operations and clients; (20) the ability to attract, train and retain highly qualified professionals; (21) fluctuations in the carrying value of BlackRock’s economic investments; (22) the impact of changes to tax legislation, including income, payroll and transaction taxes, and taxation on products, which could affect the value proposition to clients and, generally, the tax position of BlackRock; (23) BlackRock’s success in negotiating distribution arrangements and maintaining distribution channels for its products; (24) the failure by key third-party providers to fulfill their obligations to BlackRock; (25) operational, technological and regulatory risks associated with BlackRock’s major technology partnerships; (26) any disruption to the operations of third parties whose functions are integral to BlackRock’s exchange-traded funds (“ETFs”) platform; (27) the impact of BlackRock electing to provide support to its products from time to time and any potential liabilities related to securities lending or other indemnification obligations; and (28) the impact of problems, instability or failure of other financial institutions or the failure or negative performance of products offered by other financial institutions.

OVERVIEW

BlackRock, Inc. (together, with its subsidiaries, unless the context otherwise indicates, “BlackRock” or the “Company”) is a leading publicly traded investment management firm with $12.5 trillion of AUM at June 30, 2025. With approximately 22,700 employees in more than 30 countries, BlackRock provides a broad range of investment management and technology services to institutional and retail clients in more than 100 countries across the globe.

BlackRock’s diverse platform of alpha-seeking active, private markets, index and cash management investment strategies across asset classes enables the Company to offer choice and tailor investment and asset allocation solutions for clients. Product offerings include single- and multi-asset portfolios investing in equities, fixed income, private markets, liquid alternatives and money market instruments. Products are offered directly and through intermediaries in a variety of vehicles, including open-end and closed-end mutual funds, iShares® ETFs, separate accounts, collective trust funds and other pooled investment vehicles. BlackRock also offers technology and subscription services, including the investment and risk management technology platform, Aladdin®, Aladdin WealthTM, eFront®, Preqin and Cachematrix®, as well as advisory services and solutions to a broad base of institutional and wealth management clients. The Company is highly regulated and manages its clients’ assets as a fiduciary. The Company does not engage in proprietary trading activities that could conflict with the interests of its clients.

BlackRock serves a diverse mix of institutional and retail clients across the globe. Clients include tax-exempt institutions, such as defined benefit and defined contribution pension plans, charities, foundations and endowments; official institutions, such as central banks, sovereign wealth funds, supranationals and other government entities; taxable institutions, including insurance companies, financial institutions, corporations and third-party fund sponsors, and retail intermediaries.

BlackRock maintains a significant global sales and marketing presence that is focused on establishing and maintaining retail and institutional investment management and technology service relationships by marketing its services to investors directly and through third-party distribution relationships, including financial professionals and pension consultants.

Certain prior period presentations were reclassified to ensure comparability with current period classifications.

Acquisitions

On July 1, 2025, BlackRock completed the previously announced acquisition of 100% of the business and assets of HPS, a leading global credit investment manager with 100% of the consideration paid in BlackRock equity. The Company expects the addition of HPS will create an integrated private credit platform to provide both public and private income solutions for clients across their whole portfolios. At close, approximately 8.5 million units of BlackRock Saturn Subco, LLC, a consolidated subsidiary of the Company (“Subco Units”), were delivered to former equityholders of HPS and valued at $8.5 billion, based on the price of BlackRock's common stock on June 30, 2025 of approximately $1,049 and discounted for a one-year lack of marketability before exchange rights begin. Such Subco Units are exchangeable on a one-for-one basis (subject to certain adjustments) into BlackRock common stock (accordingly, the value of each unit delivered was based on the price of a share of BlackRock’s common stock and the specific terms of the SubCo Units). In addition, at the time of close, approximately 1 million restricted stock units (“RSUs”) relating to shares of the Company’s common stock were issued to HPS employees, subject to certain vesting conditions. Furthermore, deferred consideration, which is to be delivered all in SubCo Units of approximately 2.8 million and 1.6 million may be paid in approximately five years, subject to achievement of certain post-closing conditions and financial performance milestones, respectively. The transaction agreement for the HPS Acquisition also contains a customary purchase price adjustment which may be satisfied by the issuance of additional Subco Units. In general, subject to the purchase price adjustment, if (i) all contingent consideration is achieved, (ii) all Subco Units are exchanged for shares of the Company’s common stock (including those issued on the closing date), and (iii) all RSUs vest and are settled in the form of shares of the Company’s common stock, the Company does not expect to issue more than approximately 13.8 million additional shares of common stock in the aggregate (with approximately 1 million common shares issuable in respect of RSUs). The initial accounting for the business combination is incomplete as a result of the timing of the acquisition. Therefore, it is impractical for the Company to provide the full disclosure of required financial information as of the date of this filing.

On March 3, 2025, BlackRock completed the acquisition of 100% of the shares of Preqin, a leading provider of private markets data, for £2.5 billion (or approximately $3.2 billion) in cash. The Company believes bringing together Preqin's data and research tools with the complementary workflows of Aladdin and eFront in a unified platform will create a preeminent private markets technology and data provider.

In July 2025, BlackRock announced that it entered into a definitive agreement to acquire ElmTree Funds (“ElmTree”), a net-lease real estate investment firm with $7.3 billion in total assets under management as of March 31, 2025. Upfront consideration will be paid primarily in stock, with the potential for additional consideration subject to ElmTree's performance over the next five years. The acquisition of ElmTree is expected to position the Company to scale its real estate offerings, while expanding into new markets as an owner-operator. The transaction is expected to close in the third quarter of 2025, subject to customary closing conditions.

EXECUTIVE SUMMARY

(in millions, except per share data)

(1) Accounting principles generally accepted in the United States (“GAAP”).

(2) As adjusted items are described in more detail in Non-GAAP Financial Measures.

(3) Total BlackRock stockholders’ equity divided by total shares outstanding at June 30 of the respective period-end.

Three Months Ended June 30, 2025 Compared with Three Months Ended June 30, 2024

GAAP. Operating income of $1.7 billion decreased $69 million, while operating margin of 31.9% decreased 560 bps from the three months ended June 30, 2024. Operating income and operating margin reflected higher revenue, including higher investment advisory and administration fees (collectively "base fees"), driven by positive impact of markets, organic base fee growth and fees related to the GIP Transaction, as well as higher technology services and subscription revenue, partially offset by lower performance fees. The increase in revenue was more than offset by higher expense, primarily resulting from noncash acquisition-related costs and nonrecurring retention-related deferred compensation expense in connection with the GIP and Preqin Transactions. In addition, during the second quarter of 2025, BlackRock recorded a $39 million restructuring charge, comprised of severance and compensation expense for accelerated vesting of previously granted deferred compensation awards, in connection with an initiative to modify the Company's organization to fit more closely with strategic priorities.

Nonoperating income (expense) less net income (loss) attributable to noncontrolling interests (“NCI”) increased $277 million from the three months ended June 30, 2024, driven by higher noncash mark-to-market net gain (loss) on revaluation of investments including a $330 million noncash pre-tax gain related to Circle Internet Group, Inc. ("Circle"), partially offset by higher interest expense.

Earnings per diluted common share increased $0.20, or 2%, from the three months ended June 30, 2024, reflecting higher nonoperating income, partially offset by lower operating income, driven by higher noncash acquisition-related costs, as well as a higher effective tax rate and a higher diluted share count in the current quarter.

As Adjusted. Operating income of $2.1 billion increased $218 million and operating margin of 43.3% decreased 80 bps from the three months ended June 30, 2024. The acquisition-related expenses and restructuring charge described above have been excluded from as adjusted results. Earnings per diluted common share increased $1.69, or 16%, from the three months ended June 30, 2024, primarily reflecting higher operating and nonoperating income, partially offset by a higher effective tax rate and a higher diluted share count in the current quarter.

Six Months Ended June 30, 2025 Compared with Six Months Ended June 30, 2024

GAAP. Operating income of $3.4 billion decreased $64 million, while operating margin of 32.0% decreased 460 bps from the six months ended June 30, 2024. Operating income and operating margin reflected higher revenue, including higher base fees, driven by positive impact of markets, organic base fee growth and fees related to the GIP Transaction, as well as higher technology services and subscription revenue, partially offset by lower performance fees. The increase in revenue was more than offset by higher expense, primarily resulting from noncash acquisition-related costs and nonrecurring retention-related deferred compensation expense in connection with the GIP and Preqin Transactions. Operating income and operating margin for the six months ended June 30, 2025 also included the impact of the $39 million restructuring charge previously described above.

Nonoperating income (expense) less net income (loss) attributable to NCI increased $167 million from the six months ended June 30, 2024, driven by higher noncash mark-to-market net gain (loss) on revaluation of investments, including the previously mentioned $330 million noncash pre-tax gain related to Circle, partially offset by higher interest expense.

Income tax expense for the six months ended June 30, 2025, included a $149 million discrete tax benefit related to the realization of capital losses from changes in the Company's organizational structure and a $50 million discrete tax benefit related to stock-based compensation awards that vested in 2025. Income tax expense for the six months ended June 30, 2024 included a discrete tax benefit of $137 million recognized in connection with the reorganization and establishment of a more efficient global intellectual property and technology platform and corporate structure.

Earnings per diluted common share decreased $0.64, or 3%, from the six months ended June 30, 2024, primarily driven by the impact of higher acquisition-related costs, a higher effective tax rate, and a higher diluted share count in the current quarter, partially offset by higher nonoperating income.

As Adjusted. Operating income of $4.1 billion increased $475 million and operating margin of 43.2% increased 10 bps from the six months ended June 30, 2024. The acquisition-related expenses and restructuring charge described above have been excluded from as adjusted results. Earnings per diluted common share increased $3.18, or 16%, from the six months ended June 30, 2024, reflecting higher operating and nonoperating income, and a lower effective tax rate, partially offset by a higher diluted share count in the current quarter. Income tax expense, as adjusted, for the six months ended June 30, 2024 excluded the $137 million of benefit described above.

See Non-GAAP Financial Measures for further information on as adjusted items and the reconciliation to GAAP.

For further discussion of BlackRock’s revenue, expense, nonoperating results and income tax expense, see Discussion of Financial Results herein.

NON-GAAP FINANCIAL MEASURES

BlackRock reports its financial results in accordance with GAAP; however, management believes evaluating the Company’s ongoing operating results may be enhanced if investors have additional non-GAAP financial measures. Adjustments to GAAP financial measures (“non-GAAP adjustments”) include certain items management deems nonrecurring or that occur infrequently, transactions that ultimately will not impact BlackRock’s book value or certain tax items that do not impact cash flow. Management reviews non-GAAP financial measures, in addition to GAAP financial measures, to assess ongoing operations and considers them to be helpful, for both management and investors, in evaluating BlackRock’s financial performance over time. Management also uses non-GAAP financial measures as a benchmark to compare its performance with other companies and to enhance comparability for the reporting periods presented. Non-GAAP financial measures may pose limitations because they do not include all of BlackRock’s revenue and expense. BlackRock’s management does not advocate that investors consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Non-GAAP financial measures may not be comparable to other similarly titled measures of other companies.

Computations and reconciliations for all periods are derived from the condensed consolidated statements of income as follows:

(1) Operating income, as adjusted, and operating margin, as adjusted:

(in millions)

(1) Amount included within general and administration expense.

(2) Nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted:

(in millions)

(3) Net income attributable to BlackRock, Inc., as adjusted:

(in millions, except per share data)

(1) Non-GAAP adjustments, excluding income tax matters, are net of tax.

(1) Operating income, as adjusted, and operating margin, as adjusted: Management believes operating income, as adjusted, and operating margin, as adjusted, are effective indicators of BlackRock’s financial performance over time, and, therefore, provide useful disclosure to investors. Management believes that operating margin, as adjusted, reflects the Company’s long-term ability to manage ongoing costs in relation to its revenues. The Company uses operating margin, as adjusted, to assess the Company’s financial performance, to determine the long-term and annual compensation of the Company’s senior-level employees and to evaluate the Company’s relative performance against industry peers. Furthermore, this metric eliminates margin variability arising from the accounting of revenues and expenses related to distributing different product structures in multiple distribution channels utilized by asset managers.

• Operating income, as adjusted, includes the following non-GAAP expense adjustments:

(a) Compensation expense related to appreciation (depreciation) on deferred cash compensation plans. The Company excludes compensation expense related to the market valuation changes on certain deferred cash compensation plans, which the Company hedges economically. For these deferred cash compensation plans, the final value of the deferred amount to be distributed to employees in cash upon vesting is determined based on the returns on specified investment funds. The Company recognizes compensation expense for the appreciation (depreciation) of the deferred cash compensation liability in proportion to the vested amount of the award during a respective period, while the net gain (loss) to economically hedge these plans is immediately recognized in nonoperating income (expense), which creates a timing difference impacting net income. This timing difference will reverse and offset to zero over the life of the award at the end of the multi-year vesting period. Management believes excluding market valuation changes related to the deferred cash compensation plans in the calculation of operating income, as adjusted, provides useful disclosure to both management and investors of the Company’s financial performance over time as these amounts are economically hedged, while also increasing comparability with other companies.

(b) Acquisition-related costs. Acquisition-related costs include adjustments related to amortization of intangible assets, contingent consideration fair value adjustments (primarily associated with noncash contingent consideration) incurred in connection with certain acquisitions and other acquisition-related costs, including compensation costs for nonrecurring retention-related deferred compensation and general and administration expense primarily related to professional services. Management believes excluding the impact of these expenses when calculating operating income, as adjusted, provides a helpful indication of the Company’s financial performance over time, thereby providing helpful information for both management and investors while also increasing comparability with other companies.

(c) Restructuring charge. In the second quarter of 2025, BlackRock recorded a restructuring charge, comprised of severance and compensation expense for accelerated vesting of previously granted deferred compensation awards, in connection with an initiative to modify the Company's organization to fit more closely with strategic priorities. Management believes excluding the impact of this restructuring charge when calculating operating income, as adjusted, is useful to assess the Company’s financial performance and ongoing operations, and enhances comparability among periods presented.

• Revenue used for calculating operating margin, as adjusted, is reduced to exclude all of the Company’s distribution fees, which are recorded as a separate line item on the condensed consolidated statements of income, as well as a portion of investment advisory fees received that is used to pay distribution and servicing costs. For certain products, based on distinct arrangements, distribution fees are collected by the Company and then passed-through to third-party client intermediaries. For other products, investment advisory fees are collected by the Company and a portion is passed-through to third-party client intermediaries. However, in both structures, the third-party client intermediary similarly owns the relationship with the retail client and is responsible for distributing the product and servicing the client. The amount of distribution and investment advisory fees fluctuates each period primarily based on a predetermined percentage of the value of AUM during the period. These fees also vary based on the type of investment product sold and the geographic location where it is sold. In addition, the Company may waive fees on certain products that could result in the reduction of payments to the third-party intermediaries.

(2) Nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted: Management believes nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, is an effective measure for reviewing BlackRock’s nonoperating contribution to its results and provides comparability of this information among reporting periods. Nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, excludes the gain (loss) on the economic hedge of certain deferred cash compensation plans. As the gain (loss) on investments and derivatives used to hedge these compensation plans over time substantially offsets the compensation expense related to the market valuation changes on these deferred cash compensation plans, which is included in operating income, GAAP basis, management believes excluding the gain (loss) on the economic hedge of the deferred cash compensation plans when calculating nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, provides a useful measure for both management and investors of BlackRock’s nonoperating results that impact book value.

(3) Net income attributable to BlackRock, Inc., as adjusted: Management believes net income attributable to BlackRock, Inc., as adjusted, and diluted earnings per common share, as adjusted, are useful measures of BlackRock’s profitability and financial performance. Net income attributable to BlackRock, Inc., as adjusted, equals net income attributable to BlackRock, Inc., GAAP basis, adjusted for certain items management deems nonrecurring or that occur infrequently, transactions that ultimately will not impact BlackRock’s book value or certain tax items that do not impact cash flow.

For each period presented, the non-GAAP adjustments were tax effected at the respective blended rates applicable to the adjustments. In addition, the non-GAAP adjustment in the second quarter of 2025 related to contingent consideration fair value adjustments includes a tax impact associated with the deductibility of contingent consideration. In addition, the amount for income tax matters in 2024 included a discrete tax benefit of $137 million recognized in connection with the reorganization and establishment of a more efficient global intellectual property and technology platform and corporate structure. This discrete tax benefit has been excluded from as adjusted results due to the nonrecurring nature of the intellectual property reorganization.

Per share amounts reflect net income attributable to BlackRock, Inc., as adjusted, divided by diluted weighted-average common shares outstanding.

ASSETS UNDER MANAGEMENT

AUM for reporting purposes generally is based upon how investment advisory and administration fees are calculated for each portfolio. Net asset values, total assets, committed assets or other measures may be used to determine portfolio AUM.

AUM and Net Inflows (Outflows) by Product Type(1)

(in millions)

(1) Beginning in the first quarter of 2025, BlackRock updated the presentation of the Company's AUM line items. Such line items have been reclassified for 2024 to conform to this new presentation.

(2) Amounts include commodity ETFs and exchange-traded products ("ETPs").

Component Changes in AUM for the Three Months Ended June 30, 2025

The following table presents the component changes in AUM by product type for the three months ended June 30, 2025.

(in millions)

The following table presents the component changes in AUM by client type and product type for the three months ended June 30, 2025.

(in millions)

(1) Realizations represent return of capital/return on investments.

(2) Foreign exchange reflects the impact of translating non-US dollar denominated AUM into United States ("US") dollars for reporting purposes.

(3) Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing four months.

(4) Amounts include commodity ETFs and ETPs.

The following table presents the component changes in AUM by investment style and product type for the three months ended June 30, 2025.

(in millions)

The following table presents the component changes in AUM by private markets product type for the three months ended June 30, 2025.

(in millions)

(1) Realizations represent return of capital/return on investments.

(2) Foreign exchange reflects the impact of translating non-US dollar denominated AUM into US dollars for reporting purposes.

(3) Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing four months.

AUM increased $944 billion to $12.5 trillion at June 30, 2025 from $11.6 trillion at March 31, 2025, driven by market appreciation, the positive impact of foreign exchange movements and net inflows.

Long-term net inflows of $46 billion were comprised of net inflows of $85 billion and $2 billion from ETFs and retail clients, respectively, partially offset by net outflows of $41 billion from institutional clients. Net flows in long-term products are described below.

• ETFs net inflows of $85 billion were led by fixed income and equity ETFs net inflows of $44 billion and $22 billion, respectively. Active ETFs contributed $11 billion of net inflows and digital asset ETPs generated $14 billion of net inflows.
• Retail net inflows of $2 billion reflected client demand for Aperio and BlackRock's systematic liquid alternatives funds.
• Institutional active net inflows of $7 billion were driven by infrastructure, private credit and active fixed income, partially offset by net outflows from multi-asset.
• Institutional index net outflows of $48 billion reflect the impact of a single client's $52 billion lower-fee partial redemption, primarily from fixed income, partially offset by net inflows into equity products.

Cash management net inflows of $22 billion were primarily due to net inflows into US government and international money market funds.

Net market appreciation of $711 billion was primarily driven by US and global equity market appreciation.

AUM increased $172 billion due to the impact of foreign exchange movements, primarily due to the weakening of the US dollar, largely against the euro and the British pound.

Component Changes in AUM for the Six Months Ended June 30, 2025

The following table presents the component changes in AUM by product type for the six months ended June 30, 2025(1).

(in millions)

The following table presents the component changes in AUM by client type and product type for the six months ended June 30, 2025(1).

(in millions)

(1) Beginning in the first quarter of 2025, BlackRock updated the presentation of the Company's AUM line items. Such line items have been reclassified for 2024 to conform to this new presentation.

(2) Realizations represent return of capital/return on investments.

(3) Foreign exchange reflects the impact of translating non-US dollar denominated AUM into US dollars for reporting purposes.

(4) Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing seven months.

(5) Amounts include commodity ETFs and ETPs.

The following table presents the component changes in AUM by investment style and product type for the six months ended June 30, 2025(1).

(in millions)

The following table presents the component changes in AUM by private markets product type for the six months ended June 30, 2025.

(in millions)

(1) Beginning in the first quarter of 2025, BlackRock updated the presentation of the Company's AUM line items. Such line items have been reclassified for 2024 to conform to this new presentation.

(2) Realizations represent return of capital/return on investments.

(3) Foreign exchange reflects the impact of translating non-US dollar denominated AUM into US dollars for reporting purposes.

(4) Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing seven months.

AUM increased $976 billion to $12.5 trillion at June 30, 2025 from $11.6 trillion at December 31, 2024, driven by net market appreciation, the positive impact of foreign exchange movements and net inflows.

Long-term net inflows of $129 billion were comprised of net inflows of $192 billion and $15 billion from ETFs and retail clients, respectively, partially offset by net outflows of $78 billion from institutional clients. Net flows in long-term products are described below.

• ETFs net inflows of $192 billion were led by equity and fixed income ETFs net inflows of $87 billion and $77 billion, respectively. Active ETFs contributed $20 billion of net inflows and digital asset ETPs generated $17 billion of net inflows.
• Retail net inflows of $15 billion were driven by net inflows into equity products, largely reflecting net inflows in Aperio, and systematic liquid alternatives funds.
• Institutional active net inflows of $15 billion were driven by infrastructure, private credit and LifePath® target-date strategies.
• Institutional index net outflows of $93 billion were concentrated in low-fee index equity and fixed income offerings and included the impact of a single client's $52 billion partial redemption in the second quarter.

Cash management net inflows of $23 billion were led by net inflows into US government, international and prime money market funds.

Net market appreciation of $576 billion was primarily driven by US and global equity market appreciation.

AUM increased $263 billion due to the impact of foreign exchange movements, primarily due to the weakening of the US dollar, largely against the euro, the British pound, and the Japanese yen.

Component Changes in AUM for the Twelve Months Ended June 30, 2025

The following table presents the component changes in AUM by product type for the twelve months ended June 30, 2025(1).

(in millions)

The following table presents the component changes in AUM by client type and product type for the twelve months ended June 30, 2025(1).

(in millions)

(1) Beginning in the first quarter of 2025, BlackRock updated the presentation of the Company's AUM line items. Such line items have been reclassified for 2024 to conform to this new presentation.

(2) Beginning in the first quarter of 2025, BlackRock updated the presentation of net flows to separately disclose realizations, which represent return of capital/return on investments. Realizations have not been recast for 2024.

(3) Amounts include AUM attributable to the GIP Transaction.

(4) Foreign exchange reflects the impact of translating non-US dollar denominated AUM into US dollars for reporting purposes.

(5) Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing thirteen months.

(6) Amounts include commodity ETFs and ETPs.

The following table presents the component changes in AUM by investment style and product type for the twelve months ended June 30, 2025(1).

(in millions)

The following table presents the component changes in AUM by private markets product type for the twelve months ended June 30, 2025.

(in millions)

(1) Beginning in the first quarter of 2025, BlackRock updated the presentation of the Company's AUM line items. Such line items have been reclassified for 2024 to conform to this new presentation.

(2) Beginning in the first quarter of 2025, BlackRock updated the presentation of net flows to separately disclose realizations, which represent return of capital/return on investments. Realizations have not been recast for 2024.

(3) Amounts include AUM attributable to the GIP Transaction.

(4) Foreign exchange reflects the impact of translating non-US dollar denominated AUM into US dollars for reporting purposes.

(5) Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing thirteen months.

AUM increased $1.9 trillion to $12.5 trillion at June 30, 2025 from $10.6 trillion at June 30, 2024, driven by net market appreciation, net inflows, the positive impact of foreign exchange movements and AUM added from the GIP Transaction.

Long-term net inflows of $490 billion were comprised of net inflows of $432 billion, $31 billion and $27 billion from ETFs, institutional and retail clients, respectively. Net flows in long-term products are described below.

• ETFs net inflows of $432 billion were led by equity and fixed income ETFs, which saw $242 billion and $137 billion of net inflows, respectively. Digital assets ETPs generated $40 billion of net inflows and Active ETFs contributed $29 billion of net inflows.
• Institutional active net inflows of $67 billion were led by multi-asset, infrastructure and private credit net inflows. Multi-asset net inflows included the impact of several large outsourcing mandates and continued growth of the Company's LifePath target-date strategies.
• Institutional index net outflows of $36 billion were concentrated in low-fee index equity and fixed income offerings and included the impact of a single client's $52 billion partial redemption in the second quarter of 2025.
• Retail net inflows of $27 billion were led by net inflows into equity products, reflecting demand for Aperio, fixed income strategies and systematic liquid alternatives funds.

Cash management net inflows of $165 billion were primarily due to net inflows into US government and international money market funds.

Net market appreciation of $969 billion was primarily driven by US and global equity market appreciation.

AUM increased $203 billion due to the impact of foreign exchange movements, primarily resulting from the weakening of the US dollar, largely against the euro, the British pound and the Japanese yen.

DISCUSSION OF FINANCIAL RESULTS

The Company’s results of operations for the three and six months ended June 30, 2025 and 2024 are discussed below. For a further description of the Company’s revenue and expense, see the Company's Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the Securities and Exchange Commission on February 25, 2025 ("2024 Form 10-K").

Revenue

The table below presents detail of revenue for the three and six months ended June 30, 2025 and 2024 and includes the product type mix of base fees and securities lending revenue and performance fees.

(in millions)

(1) Beginning in the first quarter of 2025, BlackRock reclassified the presentation of the Company's investment advisory, administration fees and securities lending revenue line items to align with the updated presentation of the Company's AUM line items. Such line items have been reclassified for 2024 to conform to this new presentation. See page 11 of Exhibit 99.2 to the Current Report on Form 8-K furnished on April 11, 2025 for the reclassified presentation of the 2024 investment advisory, administration fees and securities lending revenue line items.

(2) Amounts include commodity ETFs and ETPs.

(3) Amounts include securities lending revenue of $171 million and $154 million for the three months ended June 30, 2025 and 2024, respectively, and $328 million and $305 million for the six months ended June 30, 2025 and 2024, respectively.

The table below lists a percentage breakdown of base fees and securities lending revenue and average AUM by product type:

(1) Beginning in the first quarter of 2025, BlackRock reclassified the presentation of the Company's investment advisory, administration fees and securities lending revenue line items to align with the updated presentation of the Company's AUM line items. Such line items have been reclassified for 2024 to conform to this new presentation. See page 11 of Exhibit 99.2 to the Current Report on Form 8-K furnished on April 11, 2025 for the reclassified presentation of the 2024 investment advisory, administration fees and securities lending revenue line items.

(2) Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing four months.

(3) Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing seven months.

(4) Amounts include commodity ETFs and ETPs.

Three Months Ended June 30, 2025 Compared with Three Months Ended June 30, 2024

Revenue increased $618 million, or 13%, from the three months ended June 30, 2024, primarily driven by organic base fee growth, the impact of market beta and foreign exchange movements on average AUM, fees related to the GIP Transaction and higher technology services and subscription revenue, including the impact of the Preqin Transaction, partially offset by lower performance fees.

Investment advisory, administration fees and securities lending revenue of $4.5 billion increased $579 million from $3.9 billion for the three months ended June 30, 2024, primarily driven by organic base fee growth, the impact of market beta and foreign exchange movements on average AUM and approximately $240 million of fees related to the GIP Transaction. Securities lending revenue of $171 million increased from $154 million for the three months ended June 30, 2024, primarily reflecting higher average balances of securities on loan.

Investment advisory performance fees of $94 million decreased $70 million from $164 million for the three months ended June 30, 2024, primarily reflecting lower revenue from private markets, liquid alternative and long-only products.

Technology services and subscription revenue of $499 million increased $104 million from $395 million for the three months ended June 30, 2024, reflecting the sustained demand for Aladdin technology offerings and approximately $60 million of revenue related to the Preqin Transaction.

Six Months Ended June 30, 2025 Compared with Six Months Ended June 30, 2024

Revenue increased $1.2 billion, or 12%, from the six months ended June 30, 2024, primarily driven by organic base fee growth, the impact of market beta and foreign exchange movements on average AUM, fees related to the GIP Transaction and higher technology services and subscription revenue, including the impact of the Preqin Transaction, partially offset by lower performance fees.

Investment advisory, administration fees and securities lending revenue of $8.9 billion increased $1.2 billion from $7.7 billion for the six months ended June 30, 2024, primarily driven by organic base fee growth, the impact of market beta and foreign exchange movements on average AUM and approximately $525 million of fees related to the GIP Transaction. Securities lending revenue of $328 million increased from $305 million for the six months ended June 30, 2024, primarily reflecting higher average balances of securities on loan.

Investment advisory performance fees of $154 million decreased $214 million from $368 million for the six months ended June 30, 2024, primarily reflecting lower revenue from private markets and liquid alternative products.

Technology services and subscription revenue of $935 million increased $163 million from $772 million for the six months ended June 30, 2024, reflecting the sustained demand for Aladdin technology offerings and approximately $80 million of revenue related to the Preqin Transaction.

Expense

The following table presents expense for the three and six months ended June 30, 2025 and 2024.

(in millions)

57

Three Months Ended June 30, 2025 Compared with Three Months Ended June 30, 2024

Expense increased $687 million, or 23%, from the three months ended June 30, 2024, reflecting higher employee compensation and benefits expense, general and administration expense, sales, asset and account expense and amortization of intangible assets. Expense for the three months ended June 30, 2025 was impacted by the previously described acquisition-related expenses incurred in connection with the GIP and Preqin Transactions(1) and a restructuring charge(1) of $39 million.

Employee compensation and benefits expense of $1.8 billion increased $261 million from $1.5 billion for the three months ended June 30, 2024, primarily reflecting the impact of the GIP and Preqin Transactions, including nonrecurring retention-related deferred compensation expense(1), partially offset by the impact of lower performance fees.

Sales, asset and account expense of $1.1 billion increased $134 million from $929 million for the three months ended June 30, 2024, driven by higher direct fund expense and distribution and servicing costs, primarily reflecting higher average AUM.

General and administration expense of $689 million increased $155 million from $534 million for the three months ended June 30, 2024, primarily associated with a higher noncash contingent consideration fair value adjustment(1) in connection with the GIP Transaction and higher technology expense.

Restructuring charge(1) of $39 million, comprised of severance and compensation expense for accelerated vesting of previously granted deferred compensation awards, was recorded in the second quarter of 2025 in connection with an initiative to modify the Company's organization to fit more closely with strategic priorities.

Amortization of intangible assets(1) of $137 million increased $98 million from $39 million for the three months ended June 30, 2024, primarily reflecting amortization of intangible assets acquired in the GIP and Preqin Transactions.

Six Months Ended June 30, 2025 Compared with Six Months Ended June 30, 2024

Expense increased $1.2 billion, or 20%, from the six months ended June 30, 2024, reflecting higher employee compensation and benefits expense, general and administration expense, sales, asset and account expense and amortization of intangible assets. Expense for the six months ended June 30, 2025 was impacted by the previously described acquisition-related expenses incurred in connection with the GIP and Preqin Transactions(1) and a restructuring charge(1) of $39 million.

Employee compensation and benefits expense of $3.5 billion increased $422 million from $3.1 billion for the six months ended June 30, 2024, primarily reflecting the impact of the GIP and Preqin Transactions, including nonrecurring retention-related deferred compensation expense(1), partially offset by the impact of lower performance fees.

Sales, asset and account expense of $2.1 billion increased $255 million from $1.8 billion for the six months ended June 30, 2024, driven by higher direct fund expense and distribution and servicing costs, primarily reflecting higher average AUM.

General and administration expense of $1.4 billion increased $337 million from $1.1 billion for the six months ended June 30, 2024, primarily associated with a higher noncash contingent consideration fair value adjustment(1) in connection with the GIP Transaction, higher technology expense, marketing and promotional expense, including the impact from higher travel and entertainment expense, and higher occupancy and office related expense.

Amortization of intangible assets(1) of $254 million increased $177 million from $77 million for the six months ended June 30, 2024, primarily reflecting amortization of intangible assets acquired in the GIP and Preqin Transactions.

(1) These expenses have been excluded from the Company's "as adjusted" financial results under the expense adjustment for acquisition-related costs and a restructuring charge, as applicable. See Non-GAAP Financial Measures for further information on as adjusted items.

Nonoperating Results

The summary of nonoperating income (expense), less net income (loss) attributable to NCI for the three and six months ended June 30, 2025 and 2024 was as follows:

(in millions)

(in millions)

(1) Amount relates to the gain (loss) from economically hedging BlackRock's deferred cash compensation plans.

(2) Management believes nonoperating income (expense), net of NCI, as adjusted, is an effective measure for reviewing BlackRock’s nonoperating results, which ultimately impacts BlackRock’s book value. See Non-GAAP Financial Measures for further information on other non-GAAP financial measures.

(3) Amounts primarily include net gains (losses) related to credit funds, direct hedge fund strategies and hedge fund solutions.

(4) Amounts primarily include net gains (losses) related to BlackRock's seed investment portfolio, net of impact of certain hedges.

(5) Amounts for the three and six months ended June 30, 2025, include nonoperating noncash pre-tax gains in connection with the Company's minority investments in Circle of approximately $330 million and Scalable Capital Limited of approximately $32 million. In addition, amounts for the three and six months ended June 30, 2025, include nonoperating noncash pre-tax gains in connection with iCapital Network, Inc. of approximately $29 million and $65 million, respectively. The amount for the three and six months ended June 30, 2024 included a noncash pre-tax gain in connection with the acquisition of SpiderRock Advisors, LLC in May 2024 of approximately $19 million. Additional amounts include earnings (losses) from certain equity method minority investments and noncash pre-tax gains (losses) related to the revaluation of certain other minority investments.

Income Tax Expense

(in millions)

(1) As adjusted items are described in more detail in Non-GAAP Financial Measures.

(2) Net of net income (loss) attributable to NCI.

2025. Income tax expense for the six months ended June 30, 2025 includes a $149 million discrete tax benefit related to the realization of capital losses from changes in the Company's organizational structure and a $50 million discrete tax benefit related to stock-based compensation awards that vested in 2025.

On July 4, 2025, the One Big Beautiful Bill Act was enacted into law, which includes permanently extending key tax provisions from the Tax Cuts and Jobs Act and modifications to the international tax framework. The Company is evaluating the impact of these provisions on the Company's condensed consolidated financial statements.

2024. Income tax expense for the six months ended June 30, 2024 included a discrete tax benefit of $137 million recognized in connection with the reorganization and establishment of a more efficient global intellectual property and technology platform and corporate structure. This discrete tax benefit has been excluded from as adjusted results due to the nonrecurring nature of the reorganization. In addition, for the six months ended June 30, 2024 income tax expense included $37 million of discrete tax benefits primarily related to stock-based compensation awards that vested in 2024.

STATEMENT OF FINANCIAL CONDITION OVERVIEW

As Adjusted Statement of Financial Condition

The following table presents a reconciliation of the condensed consolidated statement of financial condition presented on a GAAP basis to the condensed consolidated statement of financial condition, excluding the impact of separate account assets and separate account collateral held under securities lending agreements (directly related to lending separate account securities) and separate account liabilities and separate account collateral liabilities under securities lending agreements and consolidated sponsored investment products ("CIPs").

The Company presents the as adjusted statement of financial condition as additional information to enable investors to exclude certain assets that have equal and offsetting liabilities or NCI that ultimately do not have an impact on stockholders’ equity or cash flows. Management views the as adjusted statement of financial condition, which contains non-GAAP financial measures, as an economic presentation of the Company’s total assets and liabilities; however, it does not advocate that investors consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.

Separate Account Assets and Liabilities and Separate Account Collateral Held under Securities Lending Agreements

Separate account assets are maintained by BlackRock Life Limited, a wholly owned subsidiary of the Company that is a registered life insurance company in the UK, and represent segregated assets held for purposes of funding individual and group pension contracts. The Company records equal and offsetting separate account liabilities. The separate account assets are not available to creditors of the Company and the holders of the pension contracts have no recourse to the Company’s assets. The net investment income attributable to separate account assets accrues directly to the contract owners and is not reported on the condensed consolidated statements of income. While BlackRock has no economic interest in these assets or liabilities, BlackRock earns an investment advisory fee for the service of managing these assets on behalf of its clients.

In addition, the Company records on its condensed consolidated statements of financial condition the separate account collateral obtained under BlackRock Life Limited securities lending arrangements for which it has legal title as its own asset in addition to an equal and offsetting separate account collateral liability for the obligation to return the collateral. The collateral is not available to creditors of the Company, and the borrowers under the securities lending arrangements have no recourse to the Company’s assets.

Consolidated Sponsored Investment Products

The Company consolidates certain sponsored investment products accounted for as variable interest entities (“VIEs”) and voting rights entities (“VREs”). See Note 2, Significant Accounting Policies, in the notes to the consolidated financial statements contained in the 2024 Form 10-K for more information on the Company’s consolidation policy.

The Company cannot readily access cash and cash equivalents, or other assets held by CIPs to use in its operating activities. In addition, the Company cannot readily sell investments held by CIPs in order to obtain cash for use in the Company’s operations.

(in millions)

(1) Amounts represent segregated client assets and related liabilities, in which BlackRock has no economic interest. BlackRock earns an investment advisory fee for the service of managing these assets on behalf of its clients.

(2) Amounts represent the impact of consolidating CIPs.

(3) Amount includes property and equipment and other assets.

(4) Amount includes approximately $4.5 billion of deferred income tax liabilities related to goodwill and intangibles.

The following discussion summarizes the significant changes in assets and liabilities on a GAAP basis. Please see the condensed consolidated statements of financial condition as of June 30, 2025 and December 31, 2024 contained in Part I, Item 1 of this filing. The discussion does not include changes related to assets and liabilities that are equal and offsetting and have no impact on BlackRock’s stockholders’ equity.

Assets. Cash and cash equivalents at June 30, 2025 included $235 million of cash held by CIPs (see Liquidity and Capital Resources for details on the change in cash and cash equivalents during the six months ended June 30, 2025). Investments at June 30, 2025 increased $1.1 billion from December 31, 2024 (for more information see Investments herein). Goodwill and intangible assets at June 30, 2025 increased $3.3 billion from December 31, 2024, primarily due to the Preqin Transaction, partially offset by amortization of intangible assets. Other assets at June 30, 2025 increased $3.1 billion from December 31, 2024, primarily related to an increase in unit trust receivables (substantially offset by an increase in unit trust payables recorded within other liabilities) and an increase in certain minority investments.

Liabilities. Accrued compensation and benefits at June 30, 2025 decreased $1.2 billion from December 31, 2024, primarily due to 2024 incentive compensation cash payments in the first quarter of 2025, partially offset by 2025 incentive compensation accruals. Contingent consideration liabilities at June 30, 2025 increased $170 million from December 31, 2024, primarily due to a contingent consideration fair value adjustment in connection with the GIP Transaction, largely related to changes in discount rate and passage of time. Other liabilities at June 30, 2025 increased $2.3 billion from December 31, 2024, primarily due to higher unit trust payables (substantially offset by an increase in unit trust receivables recorded within other assets). Net deferred income tax liabilities at June 30, 2025 increased $244 million from December 31, 2024, primarily due to the effects of temporary differences associated with the stock-based compensation and the Preqin Transaction, partially offset by realization of capital losses from changes in the Company's organizational structure.

Investments

The Company’s investments were $10.9 billion and $9.8 billion at June 30, 2025 and December 31, 2024, respectively. Investments include CIPs accounted for as VIEs and VREs. Management reviews BlackRock’s investments on an “economic” basis, which eliminates the NCI portion of investments that does not impact BlackRock’s book value or net income attributable to BlackRock. BlackRock’s management does not advocate that investors consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.

The Company presents investments, as adjusted, to enable investors to understand the economic portion of investments that is owned by the Company as a gauge to measure the impact of changes in net nonoperating income (expense) on investments to net income (loss) attributable to BlackRock.

The Company further presents net “economic” investment exposure, net of deferred cash compensation investments and hedged exposures, to reflect another helpful measure for investors. The economic impact of investments held pursuant to deferred cash compensation plans is substantially offset by a change in associated compensation expense, and the impact of the portfolio of seed investments is mitigated by futures entered into as part of the Company's macro hedging strategy. Carried interest capital allocations are excluded as there is no impact to BlackRock’s stockholders’ equity until such amounts are realized as performance fees. Finally, the Company’s regulatory investment in Federal Reserve Bank stock, which is not subject to market or interest rate risk, is excluded from the Company’s net economic investment exposure.

(in millions)

(1) Amounts include $2.0 billion and $1.9 billion of carried interest (VIEs) at June 30, 2025 and December 31, 2024, respectively, which has no impact on the Company’s “economic” investment exposure.

(2) Amounts do not include investments in corporate minority investments included in other assets on the condensed consolidated statements of financial condition.

The following table represents the carrying value of the Company’s economic investment exposure, by asset type, at June 30, 2025 and December 31, 2024:

(in millions)

(1) Amounts include seed investments in equity, fixed income, and multi-asset mutual funds/strategies.

(2) Other alternatives primarily include co-investments in credit funds, direct hedge fund strategies, and hedge fund solutions.

As adjusted investment activity for the six months ended June 30, 2025 was as follows:

(in millions)

(1) Amount includes distributions representing return of capital and return on investments.

(2) Amount includes the impact of foreign exchange movements.

LIQUIDITY AND CAPITAL RESOURCES

BlackRock Cash Flows Excluding the Impact of CIPs

The condensed consolidated statements of cash flows include the cash flows of the CIPs. The Company uses an adjusted cash flow statement, which excludes the impact of CIPs, as a supplemental non-GAAP measure to assess liquidity and capital requirements. The Company believes that its cash flows, excluding the impact of the CIPs, provide investors with useful information on the cash flows of BlackRock relating to its ability to fund additional operating, investing and financing activities. BlackRock’s management does not advocate that investors consider such non-GAAP measures in isolation from, or as a substitute for, its cash flows presented in accordance with GAAP.

The following table presents a reconciliation of the condensed consolidated statements of cash flows presented on a GAAP basis to the condensed consolidated statements of cash flows, excluding the impact of the cash flows of CIPs:

(in millions)

Sources of BlackRock’s operating cash primarily include base fees and securities lending revenue, performance fees, technology services and subscription revenue, advisory and other revenue and distribution fees. BlackRock uses its cash to pay all operating expenses, interest and principal on borrowings, income taxes, dividends and repurchases of the Company’s stock, acquisitions, capital expenditures and purchases of co-investments and seed investments.

For details of the Company’s GAAP cash flows from operating, investing and financing activities, see the condensed consolidated statements of cash flows contained in Part I, Item 1 of this filing.

Cash flows provided by/(used in) operating activities, excluding the impact of CIPs, primarily include the receipt of base fees, securities lending revenue, performance fees and technology services and subscription revenue, offset by the payment of operating expenses incurred in the normal course of business, including year-end incentive and deferred cash compensation accrued during prior years, and income tax payments.

Cash flows used in investing activities, excluding the impact of CIPs, for the six months ended June 30, 2025 were $3.4 billion, primarily reflecting $3.1 billion related to the Preqin Transaction, $394 million of net purchases of investments and $167 million of purchases of property and equipment, partially offset by $262 million of distributions of capital from equity method investees.

Cash flows used in financing activities, excluding the impact of CIPs, for the six months ended June 30, 2025 were $2.3 billion, primarily resulting from $1.6 billion of cash dividend payments, $1.1 billion of share repurchases, including $750 million in open market transactions and $303 million of employee tax withholdings related to employee stock transactions, and repayment of €700 million (or approximately $822 million based on the EUR/USD foreign exchange rate at June 30, 2025) of long-term borrowings, partially offset by €1.0 billion (or approximately $1.2 billion based on the EUR/USD foreign exchange rate at June 30, 2025) of proceeds from long-term borrowings.

The Company manages its financial condition and funding to maintain appropriate liquidity for the business. Management believes that the Company’s liquid assets, continuing cash flows from operations, borrowing capacity under the Company’s existing revolving credit facility and uncommitted commercial paper private placement program, provide sufficient resources to meet the Company’s short-term and long-term cash needs, including operating, debt and other obligations as they come due and anticipated future capital requirements. Liquidity resources at June 30, 2025 and December 31, 2024 were as follows:

(in millions)

(1) Amounts exclude restricted cash.

(2) The Company cannot readily access such cash and cash equivalents to use in its operating activities.

(3) The percentage of cash and cash equivalents held by the Company’s US subsidiaries was approximately 55% and 65% at June 30, 2025 and December 31, 2024, respectively. See Net Capital Requirements herein for more information on net capital requirements in certain regulated subsidiaries.

Total liquidity resources decreased $2.9 billion during the six months ended June 30, 2025, primarily reflecting $3.1 billion related to the Preqin Transaction, cash dividend payments of $1.6 billion, share repurchases of $1.1 billion, partially offset by a $500 million increase in the aggregate commitment amount under the credit facility, approximately $285 million of net proceeds from long-term borrowings and cash flows from operating activities.

A significant portion of the Company’s $8.5 billion of investments, as adjusted, is illiquid in nature and, as such, cannot be readily convertible to cash.

Share Repurchases. During the six months ended June 30, 2025, the Company repurchased 0.8 million common shares under the Company’s existing share repurchase program for approximately $750 million. At June 30, 2025, there were approximately 3.0 million shares still authorized to be repurchased under the program. The timing and actual number of shares repurchased will depend on a variety of factors, including legal limitations, price and market conditions.

Net Capital Requirements. The Company is required to maintain net capital in certain regulated subsidiaries within a number of jurisdictions, which is partially maintained by retaining cash and cash equivalent investments in those subsidiaries or jurisdictions. As a result, such subsidiaries of the Company may be restricted in their ability to transfer cash between different jurisdictions and to their parents. Additionally, transfers of cash between international jurisdictions may have adverse tax consequences that could discourage such transfers.

BlackRock Institutional Trust Company, N.A. (“BTC”) is chartered as a national bank that does not accept deposits or make commercial loans and whose powers are limited to trust and other fiduciary activities. BTC provides investment management and other fiduciary services, including investment advisory and securities lending agency services, to institutional clients. BTC is subject to regulatory capital and liquid asset requirements administered by the US Office of the Comptroller of the Currency.

At June 30, 2025 and December 31, 2024, the Company was required to maintain approximately $2.1 billion and $1.8 billion, respectively, in net capital in certain regulated subsidiaries, including BTC, entities regulated by the Financial Conduct Authority and Prudential Regulation Authority in the UK, and the Company’s broker-dealers. The Company was in compliance with all applicable regulatory net capital requirements.

Short-Term Borrowings

2025 Revolving Credit Facility. The Company maintains an unsecured revolving credit facility, which is available for working capital and general corporate purposes (the “2025 Credit Facility”). In April 2025, the 2025 Credit Facility was amended to, among other things, (1) increase the aggregate commitment amount by $500 million to $5.9 billion, (2) extend the maturity date to March 2030 for lenders (other than one non-extending lender) pursuant to the Company's option to request extensions of the maturity date available under the 2025 Credit Facility (with the commitment of the non-extending lender maturing in March 2028) and (3) change the threshold for the maximum consolidated leverage ratio covenant to 3.5 to 1. The amended 2025 Credit Facility permits the Company to request up to an additional $1.4 billion of borrowing capacity, subject to lender credit approval, which could increase the overall size of the 2025 Credit Facility to an aggregate principal amount of up to $7.3 billion. Interest on outstanding borrowings accrues at an applicable benchmark rate for the denominated currency of the loan, plus a spread. The 2025 Credit Facility requires the Company not to exceed a maximum consolidated leverage ratio (ratio of net debt to earnings before interest, taxes, depreciation and amortization, where net debt equals total debt less unrestricted cash) of 3.5 to 1, which was satisfied with a ratio of less than 1 to 1 at June 30, 2025. At June 30, 2025, the Company had no amount outstanding under the 2025 Credit Facility.

Commercial Paper Program. The Company may issue short-term unsecured commercial paper notes (the “CP Notes”) on a private-placement basis up to a maximum aggregate amount outstanding at any time of $5 billion. The payments of the CP Notes have been unconditionally guaranteed by BlackRock Finance, Inc. (formerly known as BlackRock, Inc.) ("Old BlackRock") (the "CP Notes Guarantee"). The CP Notes will rank equal in right of payment with all of BlackRock's other unsubordinated indebtedness, and the obligations of Old BlackRock under the CP Notes Guarantee will rank equal in right of payment with all of Old BlackRock's other unsubordinated indebtedness. Net proceeds of issuances of the CP Notes are expected to be used for general corporate purposes. The commercial paper program is currently supported by the 2025 Credit Facility. At June 30, 2025, BlackRock had no CP Notes outstanding.

Subsidiary Credit Facility. BlackRock Investment Management (UK) Limited ("BIM UK"), a wholly owned subsidiary of the Company, maintains a revolving credit facility (the “Subsidiary Credit Facility”) in the amount of £25 million (or approximately $34 million based on the GBP/USD foreign exchange rate at June 30, 2025) with a rolling 364-day term structure. The Subsidiary Credit Facility is available for BIM UK's general corporate and working capital purposes. At June 30, 2025, there was no amount outstanding under the Subsidiary Credit Facility.

Long-Term Borrowings

2035 Notes. In April 2025, the Company issued €1.0 billion (or approximately $1.2 billion based on the EUR/USD foreign exchange rate at June 30, 2025) in aggregate principal amount of 3.75% senior unsecured and unsubordinated notes maturing July 18, 2035 (the "2035 Notes"). The 2035 Notes are listed on the New York Stock Exchange. Net proceeds are being used for general corporate purposes, which included the repayment of the €700 million (or approximately $822 million based on the EUR/USD foreign exchange rate at June 30, 2025) 1.25% Notes in May 2025 at maturity. Interest of approximately €38 million (or approximately $44 million based on the EUR/USD foreign exchange rate at June 30, 2025) per year is payable annually on July 18 of each year which commenced on July 18, 2025. The 2035 Notes are fully and unconditionally guaranteed (the "Guarantee") on a senior unsecured basis by Old BlackRock. The 2035 Notes and the Guarantee rank equally in right of payment with all of the Company and Old BlackRock's other unsubordinated indebtedness, respectively. The 2035 Notes may be redeemed at the option of the Company, in whole or in part, at any time prior to April 18, 2035 at a "make-whole" redemption price, or thereafter at 100% of the principal amount of the 2035 Notes, in each case plus accrued but unpaid interest. The unamortized discount and debt issuance costs are being amortized over the remaining term of the 2035 Notes.

At June 30, 2025, the principal amount of long-term notes outstanding was $12.9 billion. See Note 15, Borrowings, in the 2024 Form 10-K for more information on overall borrowings outstanding as of December 31, 2024.

During the six months ended June 30, 2025, the Company paid approximately $236 million of interest on long-term notes. Future principal repayments and interest requirements at June 30, 2025 were as follows:

(in millions)

(1) The amounts related to the 2035 Notes are calculated using the EUR/USD foreign exchange rate as of June 30, 2025.

Supplemental Guarantor Information

BlackRock, Inc. (“New BlackRock”) is the issuer of 4.6% Notes due 2027, 4.7% Notes due 2029, 5.0% Notes due 2034, 4.9% Notes due 2035, 3.75% Notes due 2035, 5.25% Notes due 2054 and 5.35% Notes due 2055 (collectively the "New BlackRock Notes"), which are fully and unconditionally guaranteed on a senior unsecured basis by Old BlackRock ("Notes Guarantees"). The New BlackRock Notes and the Notes Guarantees rank equally in right of payment with all of BlackRock's and Old BlackRock's other unsubordinated indebtedness, respectively. No other subsidiary of New BlackRock or Old BlackRock guarantees the New BlackRock Notes. The Notes Guarantees will be automatically and unconditionally released and discharged, and Old BlackRock will be released from all obligations under the indenture in its capacity as guarantor, in certain circumstances as described in the separate indentures governing the New BlackRock Notes. See Note 14, Borrowings, in the notes to the condensed consolidated financial statements and Note 15, Borrowings, in the 2024 Form 10-K for further information on New BlackRock Notes.

In October 2024, in connection with the closing of the GIP Transaction, New BlackRock also entered into a guarantee (the “New BlackRock Guarantee”) pursuant to which New BlackRock fully and unconditionally guaranteed, on a senior unsecured basis, the remaining obligations of Old BlackRock with respect to its previously issued senior unsecured notes. The New BlackRock Guarantee ranks equally in right of payment with all of New BlackRock's other unsubordinated indebtedness. In certain circumstances as described in the New BlackRock Guarantee, the New BlackRock Guarantee will be automatically and unconditionally released and discharged, and New BlackRock will be released from all obligations under the New BlackRock Guarantee.

The following presents unaudited summarized financial information of New BlackRock and Old BlackRock (together with New BlackRock, the "Obligor Group") on a combined basis as of June 30, 2025 and December 31, 2024 and for the three and six months ended June 30, 2025. Intercompany balances and transactions between New BlackRock and Old BlackRock have been eliminated, and balances and transactions with subsidiaries, which are not part of the Obligor Group, have been separately presented, and investments in and equity in earnings related to subsidiaries of New BlackRock and Old BlackRock, which are not members of the Obligor Group, have been excluded.

Summarized Balance Sheet (unaudited)

(in millions)

68

Summarized Income Statement (unaudited)

For the three months ended June 30, 2025, net loss of the Obligor Group was $231 million, primarily comprised of $71 million amortization expense, a loss of $79 million primarily related to a contingent consideration fair value adjustment, and $130 million of interest expense, partially offset by a tax benefit. Revenue during this period was not material.

For the six months ended June 30, 2025, net loss of the Obligor Group was $466 million, primarily comprised of $141 million amortization expense, a loss of $167 million primarily related to a contingent consideration fair value adjustment, and $252 million of interest expense, partially offset by a tax benefit. Revenue during this period was not material.

Commitments and Contingencies

Contingent Consideration Liabilities. In connection with certain acquisitions, BlackRock is required to make contingent payments, subject to the achievement of specified performance targets or satisfaction of certain post-closing events. The fair value of any contingent consideration is estimated at the time of acquisition closing and is included in contingent consideration liabilities on the condensed consolidated statements of financial condition. The fair value of the remaining aggregate contingent payments at June 30, 2025 totaled $4.5 billion, including $4.3 billion related to the GIP Transaction, which, if any, will be settled all in stock, for a number of shares ranging from 4.0 million to 5.2 million shares, subject to achieving certain performance targets. See Note 3, Acquisitions, in the notes to the condensed consolidated financial statements for more information.

Investment Commitments. At June 30, 2025, the Company had $1.2 billion of various capital commitments to fund sponsored investment products, including CIPs. These products include various private market products, including private equity funds, real assets funds and opportunistic funds. This amount excludes additional commitments made by consolidated funds of funds to underlying third-party funds as third-party noncontrolling interest holders have the legal obligation to fund the respective commitments of such funds of funds. Generally, the timing of the funding of these commitments is unknown and the commitments are callable on demand at any time prior to the expiration of the commitment. These unfunded commitments are not recorded on the condensed consolidated statements of financial condition. These commitments do not include potential future commitments approved by the Company that are not yet legally binding. The Company intends to make additional capital commitments from time to time to fund additional investment products for, and with, its clients.

Critical Accounting Policies and Estimates

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expense during the reporting periods. Actual results could differ significantly from those estimates. These estimates, judgments and assumptions are affected by the Company’s application of accounting policies. Management considers the following accounting policies and estimates critical to understanding the condensed consolidated financial statements. These policies and estimates are considered critical because they had a material impact, or are reasonably likely to have a material impact on the Company’s condensed consolidated financial statements and because they require management to make significant judgments, assumptions or estimates. For a summary of these and additional accounting policies as well as recent accounting developments, see Note 2, Significant Accounting Policies, in the notes to the condensed consolidated financial statements. In addition, see Critical Accounting Policies and Estimates in Management’s Discussion and Analysis of Financial Condition and Results of Operations and Note 2, Significant Accounting Policies, in the 2024 Form 10-K for further information.

Consolidation. The Company consolidates entities in which the Company has a controlling financial interest. The Company has a controlling financial interest when it owns a majority of the VRE or is a primary beneficiary (“PB”) of a VIE. Assessing whether an entity is a VIE or a VRE involves judgment and analysis on a structure-by-structure basis. Factors considered in this assessment include the entity’s legal organization, the entity’s capital structure, the rights of equity investment holders, the Company’s contractual involvement with and economic interest in the entity and any related party or de facto agent implications of the Company’s involvement with the entity. Entities that are determined to be VREs are consolidated if the Company can exert absolute control over the financial and operating policies of the investee, which generally exists if there is greater than 50% voting interest. Entities that are determined to be VIEs are consolidated if the Company is the PB of the entity. BlackRock is deemed to be the PB of a VIE if it (1) has the power to direct the activities that most significantly impact the entities’ economic performance and (2) has the obligation to absorb losses or the right to receive benefits that potentially could be significant to the VIE. There is judgment involved in assessing whether the Company is the PB of a VIE. In addition, the Company’s ownership interest in VIEs is subject to variability and is impacted by actions of other investors such as ongoing redemptions and contributions. The Company generally consolidates VIEs in which it holds an economic interest of 10% or greater and deconsolidates such VIEs once its economic interest falls below 10%. As of June 30, 2025, the Company was deemed to be the PB of approximately 115 VIEs, which are BlackRock sponsored investment products. See Note 6, Consolidated Sponsored Investment Products, in the notes to the condensed consolidated financial statements for more information.

Fair Value Measurements. The Company’s assessment of the significance of a particular input to the fair value measurement according to the fair value hierarchy (i.e., Level 1, 2 and 3 inputs, as defined) in its entirety requires judgment and considers factors specific to the financial instrument. See Note 2, Significant Accounting Policies, and Note 8, Fair Value Disclosures, in the notes to the condensed consolidated financial statements for more information on fair value measurements.

Goodwill and Intangible Assets

The Company accounts for business combinations using the acquisition method of accounting, where the purchase price is allocated to the assets acquired and liabilities assumed based on their fair values at the date of the transaction. Any excess purchase consideration over the fair value of net assets acquired is recorded as goodwill.

The Company determines fair value of identifiable intangible assets acquired using the best available information which incorporates various estimates and assumptions, including, but not limited to, future expected cash flows, fundraising assumptions, useful lives, and discount rates. These estimates are based on historical data, internal estimates, or external sources. Unanticipated events may affect these assumptions. During the six months ended June 30, 2025, BlackRock recorded finite-lived customer relationships and technology-related intangible assets in connection with the Preqin Transaction of approximately $1.1 billion and $125 million, respectively. The acquisition date fair value of customer relationships and technology-related intangible assets were determined using an income approach and a replacement cost approach, respectively, all of which applied certain significant assumptions, which are inherently uncertain and unpredictable. The assumptions used in the income approach primarily included discount rates ranging from 11.0%-11.5%, as well as estimated revenue projections, operating profits and tax rates. The assumptions used in the replacement cost approach primarily included a discount rate of 10.5% as well as estimated reproduction costs and third-party developer's profit and opportunity cost of capital invested. While the Company believes these assumptions to be reasonable and appropriate, changes in these estimates could produce different fair value amounts.

Contingent Consideration Liabilities

In connection with certain acquisitions, BlackRock is required to make contingent payments, subject to the achievement of specified performance targets or satisfaction of certain post-closing events. The fair value of this contingent consideration is estimated at the time of acquisition closing and is included in contingent consideration liabilities on the condensed consolidated statements of financial condition. The fair value of the remaining aggregate contingent payments at June 30, 2025 totaled $4.5 billion, including $4.3 billion related to the GIP Transaction, which, if any, will be settled all in stock, ranging from 4.0 million to 5.2 million shares, subject to achieving certain performance targets. The fair value of the GIP Transaction contingent consideration is estimated using the income approach, which included certain significant inputs such as a risk-free discount rate of approximately 3.7% as well as current estimates of the timing and amounts of fundraising forecasts, stock and AUM volatility, and correlation between stock price and AUM (Level 3 inputs). As the estimated fair value of the contingent consideration subsequently changes, contingent consideration liabilities are adjusted, resulting in contingent consideration fair value adjustments recorded within general and administration expense of the condensed consolidated statements of income until the contingency is resolved. Accordingly, changes in the key inputs and assumptions described will impact the amount of contingent consideration expense recorded in a reporting period.

Investment Advisory Performance Fees / Carried Interest

The Company receives investment advisory performance fees, including incentive allocations (carried interest) from certain actively managed investment funds and certain separately managed accounts ("SMAs"). These performance fees are dependent upon exceeding specified relative or absolute investment return thresholds, which vary by product or account, and include monthly, quarterly, annual or longer measurement periods.

Performance fees, including carried interest, are generated on certain management contracts when performance hurdles are achieved. Such performance fees are recognized when the contractual performance criteria have been met and when it is determined that they are no longer probable of significant reversal. Given the unique nature of each fee arrangement, contracts with customers are evaluated on an individual basis to determine the timing of revenue recognition. Significant judgment is involved in making such determination. Performance fees typically arise from investment management services that began in prior reporting periods. Consequently, a portion of the fees the Company recognizes may be partially related to the services performed in prior periods that meet the recognition criteria in the current period. At each reporting date, the Company considers various factors in estimating performance fees to be recognized, including carried interest. These factors include but are not limited to whether: (1) the amounts are dependent on the financial markets and, thus, are highly susceptible to factors outside the Company’s influence; (2) the ultimate payments have a large number and a broad range of possible amounts; and (3) the funds or SMAs have the ability to (a) invest or reinvest their sales proceeds or (b) distribute their sales proceeds and determine the timing of such distributions.

The Company is allocated/distributed carried interest from certain alternative investment products upon exceeding performance thresholds. The Company may be required to reverse/return all, or part, of such carried interest allocations/distributions depending upon future performance of these products. Carried interest subject to such clawback provisions is recorded in investments or cash and cash equivalents to the extent that it is distributed, on its condensed consolidated statements of financial condition. The Company records a liability for deferred carried interest to the extent it receives cash or capital allocations related to carried interest prior to meeting the revenue recognition criteria. At June 30, 2025 and December 31, 2024, the Company had $2.1 billion and $1.9 billion, respectfully, of deferred carried interest recorded in other liabilities on the condensed consolidated statements of financial condition. A portion of the deferred carried interest may also be paid to certain employees and other third parties. The ultimate timing of the recognition of performance fee revenue and related compensation expense, if any, is unknown. See Note 16*, Revenue,* in the notes to the condensed consolidated financial statements for detailed changes in the deferred carried interest liability balance for the three and six months ended June 30, 2025 and 2024.

AUM Market Price Risk. BlackRock’s investment advisory and administration fees are primarily comprised of fees based on a percentage of the value of AUM and, in some cases, performance fees expressed as a percentage of the returns realized on AUM. At June 30, 2025, the majority of the Company’s investment advisory and administration fees were based on average or period end AUM of the applicable investment funds or separate accounts. Movements in equity market prices, interest rates/credit spreads, foreign exchange rates or all three could cause the value of AUM to decline, which would result in lower investment advisory and administration fees.

Corporate Investments Portfolio Risks. As a leading investment management firm, BlackRock devotes significant resources across all of its operations to identifying, measuring, monitoring, managing and analyzing market and operating risks, including the management and oversight of its own investment portfolio. The Board of Directors of the Company has adopted guidelines for the review of investments (or commitments to invest) to be made by the Company, requiring, among other things, that certain investments be referred to the Board of Directors, depending on the circumstances, for notification or approval.

In the normal course of its business, BlackRock is exposed to equity market price risk, interest rate/credit spread risk and foreign exchange rate risk associated with its corporate investments.

BlackRock has investments primarily in sponsored investment products that invest in a variety of asset classes, including real assets, private equity and hedge funds. Investments generally are made for co-investment purposes, to establish a performance track record, to hedge exposure to certain deferred cash compensation plans or for regulatory purposes. The Company has a seed capital hedging program in which it enters into futures to hedge market and interest rate exposure with respect to its total portfolio of seed investments in sponsored investment products. The Company had outstanding futures related to its seed capital hedging program with an aggregate notional value of approximately $1.9 billion and $1.8 billion at June 30, 2025 and December 31, 2024, respectively.

At June 30, 2025, approximately $6.9 billion of BlackRock’s investments were held in consolidated sponsored investment products accounted for as variable interest entities or voting rights entities. Excluding the impact of the Federal Reserve Bank stock, carried interest, investments made to hedge exposure to certain deferred cash compensation plans and certain investments that are hedged via the seed capital hedging program, the Company’s economic exposure to its investment portfolio is $4.1 billion. See Statement of Financial Condition Overview-Investments in Item 2, Management’s Discussion and Analysis of Financial Condition and Results of Operations for further information on the Company’s investments.

Equity Market Price Risk. At June 30, 2025, the Company’s net exposure to equity market price risk in its investment portfolio was approximately $1.5 billion of the Company’s total economic investment exposure. Investments subject to market price risk include public and private equity and real assets investments, hedge funds and funds of funds as well as mutual funds. The Company estimates that a hypothetical exposure to a 10% adverse change in market prices would result in a decrease of approximately $149 million in the carrying value of such investments.

Interest Rate/Credit Spread Risk. At June 30, 2025, the Company was exposed to interest rate risk and credit spread risk as a result of approximately $2.6 billion of investments in debt securities and sponsored investment products that invest primarily in debt securities. Management considered a hypothetical exposure to an adverse 100 basis point fluctuation in interest rates or credit spreads and estimates that the impact of such a fluctuation on these investments, in the aggregate, would result in a decrease, or increase, of approximately $67 million in the carrying value of such investments.

Foreign Exchange Rate Risk. As discussed above, the Company invests in sponsored investment products that invest in a variety of asset classes. The carrying value of the total economic investment exposure denominated in foreign currencies, primarily based in the British pound and euro, was approximately $1.5 billion at June 30, 2025. A hypothetical exposure to a 10% adverse change in the applicable foreign exchange rates would result in approximately a $151 million decline in the carrying value of such investments.

Other Market Risks. The Company executes forward foreign currency exchange contracts to mitigate the risk of certain foreign exchange risk movements. At June 30, 2025, the Company had outstanding forward foreign currency exchange contracts with an aggregate notional value of approximately $2.4 billion, with expiration dates primarily in July 2025. In addition, the Company entered into futures to hedge economically the exposure to market movements on certain deferred cash compensation plans. At June 30, 2025, the Company had outstanding exchange traded futures with aggregate notional values related to its deferred cash compensation hedging program of approximately $221 million, with expiration dates during the third quarter of 2025.

Disclosure Controls and Procedures. Under the direction of BlackRock’s Chief Executive Officer and Chief Financial Officer, BlackRock evaluated the effectiveness of its disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this quarterly report on Form 10-Q. Based on this evaluation, BlackRock’s Chief Executive Officer and Chief Financial Officer have concluded that BlackRock’s disclosure controls and procedures were effective.

Internal Control over Financial Reporting. There were no changes in our internal control over financial reporting that occurred during the quarter ended June 30, 2025 that have materially affected or are reasonably likely to materially affect our internal control over financial reporting.

In addition to the other information set forth in this report, the risks discussed in BlackRock's Annual Report on Form 10-K for the year ended December 31, 2024 could materially affect our business, financial condition, operating results and nonoperating results.