Carlyle Group Inc.: Form 10-Q for the period ended Jun 30, 2026

Unless context suggests otherwise, references in this Quarterly Report on Form 10-Q to “Carlyle,” the “Company,”

“we,” “us,” and “our” refer to The Carlyle Group Inc. and its consolidated subsidiaries. The following discussion and

analysis should be read in conjunction with the consolidated financial statements and the related notes included in this

Quarterly Report on Form 10-Q and the Annual Report on Form 10-K for the year ended December 31, 2025.

Overview

We are one of the world’s largest global investment firms and deploy private capital across our business. We conduct our

operations through three reportable segments: Global Private Equity, Global Credit, and Carlyle AlpInvest.

• Global Private Equity — Our Global Private Equity segment advises our buyout, growth, real estate, and infrastructure &

natural resources funds. The segment also includes the NGP Carry Funds advised by NGP. As of June 30, 2026, our

Global Private Equity segment had $162.7 billion in AUM and $96.6 billion in Fee-earning AUM.

• Global Credit — Our Global Credit segment advises funds and vehicles that pursue investment strategies including

insurance solutions, liquid credit, opportunistic credit, direct lending, asset-backed finance, aviation finance, infrastructure

credit, cross-platform credit products, and global capital markets. As of June 30, 2026, our Global Credit segment had

$211.1 billion in AUM and $167.6 billion in Fee-earning AUM.

• Carlyle AlpInvest — Our Carlyle AlpInvest segment advises global private equity programs that pursue secondary

purchases and financing of existing portfolios, managed co-investment programs, and primary fund investments. As of

June 30, 2026, our Carlyle AlpInvest segment had $111.7 billion in AUM and $70.2 billion in Fee-earning AUM.

We earn management fees pursuant to contractual arrangements with the investment funds that we manage and fees for

transaction advisory and oversight services provided to portfolio companies of these funds. We also typically receive a

performance fee from an investment fund, which may be either an incentive fee or a special residual allocation of income,

which we refer to as a performance allocation, or carried interest, in the event that specified investment returns are achieved by

the fund. Under U.S. generally accepted accounting principles (“U.S. GAAP”), we are required to consolidate some of the

investment funds that we advise. However, for segment reporting purposes, we present revenues and expenses on a basis that

deconsolidates these investment funds. Refer to Note 14, Segment Reporting, to the condensed consolidated financial

statements included in this Quarterly Report on Form 10-Q for more information on the differences between our financial

results reported pursuant to U.S. GAAP and our financial results for segment reporting purposes.

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Our Global Investment Offerings

The following table provides a breakout of the product offerings and related acronyms included in our total assets under

management of $485 billion as of June 30, 2026 for each of our three global business segments (in billions):

Note: All amounts shown represent total assets under management as of June 30, 2026, and totals may not sum due to rounding. In addition,

certain carry funds included herein may not be included in fund performance if they have not made an initial capital call or commenced

investment activity.

(1) Includes our Financial Services (CGFSP), Sub-Saharan Africa Buyout (CSSAF), Peru Buyout (CPF), and MENA Buyout funds, as well

as platform accounts which invest across Corporate Private Equity strategies.

(2) NGP Energy funds are advised by NGP Energy Capital Management, LLC, a separately registered investment adviser. We do not serve as

an investment adviser to these funds.

(3) Includes our Infrastructure (CGIOF) and Renewable Energy (CRSEF) funds.

(4) Includes Carlyle FRL, capital raised from strategic third-party investors which directly invest in Fortitude alongside Carlyle FRL, as well

as the fair value of the general account assets covered by the strategic advisory services agreement with Fortitude.

(5) Includes our business development companies (CGBD / CARS), Europe Direct Lending funds (EDLF / ETAC), and our evergreen fund

(CDLF).

(6) Includes our Real Estate Credit fund (CNLI).

(7) Includes Carlyle AlpInvest Private Markets (CAPM) and Carlyle AlpInvest Private Markets Secondaries (CAPS) funds.

Trends Affecting Our Business

Our global business is affected by the conditions in the global financial markets, global economies and the geopolitical

landscape, particularly in the U.S., Europe, and Asia, as discussed in Item 1A “Risk Factors” of our Annual Report on

Form 10-K.

Equity markets posted their strongest quarterly returns since 2020 in Q2 2026, rising despite persistent geopolitical

tensions in the Strait of Hormuz. Although a ceasefire agreement improved market sentiment, geopolitical tensions persisted,

and shipping through the Strait of Hormuz remained well below pre-conflict levels, leaving physical supply constraints largely

intact. The S&P 500, NASDAQ Composite, and Russell 2000 returned 14.9%, 21.4%, and 21.2%, respectively, supported by

upward earnings per share (“EPS”) revisions—consensus 2026 S&P 500 EPS growth has risen 1,440 basis points (“bps”) since

the onset of the Iran conflict. Rotation was a defining feature through the first half of the year: the Magnificent 7 stocks

declined 10% from their peak and software stocks finished the half down 20%, while traditional economy sectors such as

construction & engineering, communications equipment, and marine transport, as well as hardware, led performance, and small

caps outperformed large caps by over 1,000 bps. Globally, Europe’s Euro Stoxx 50 returned 13.6% during the quarter, while

Asian markets were the strongest performers—Korea’s KOSPI, Taiwan’s TAIEX, and Japan’s Nikkei returned 67.8%, 45.4%,

and 37.2%, respectively, driven by semiconductor demand tied to AI infrastructure. However, record earnings from memory

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chip manufacturers paradoxically triggered a sharp KOSPI selloff of 25% from peak, as investors grew concerned that surging

circuit board costs could impair the economics of the broader AI value chain. In private markets, buyout performance improved

somewhat compared to the S&P 500 for Q1 2026 (the latest data available), but this was primarily due to quarter end volatility.

Over longer periods against benchmarks that align more closely with market capitalization and display less concentration,

buyouts continue to outperform. Compared to the S&P 600 small-cap index, U.S. buyouts have generated outperformance of

506 bps over the last five years, 386 bps over the last 10 years, and 310 bps over the last 15 years.

Official estimates of U.S. GDP surprised to the downside in Q2 2026, but real final demand came in right on top of the

2.2% estimate implied by our proprietary portfolio data, as a surge in AI-related capital goods imports slowed topline GDP

growth relative to what would be implied by investment outlays, and inventory liquidation also reduced growth. Our measure of

corporate revenue growth accelerated to 6.2% annualized in Q2 2026, up from 5.7% in Q1 2026, but price rather than volume

accounted for a disproportionate share of that growth. Our data imply real consumption slowed to 1.8% annualized as

households absorbed the price shock, with spending among top-third households growing at 2.3x the rate of bottom-third

households. Headline inflation finished June at a 3.7% annual rate, and with core inflation above 3%, the Fed has not hit its

inflation target in five years. Against this backdrop, interest rates no longer appear to be on a pre-set path toward sub-3%, and

market participants largely expect the Fed’s next move to be a rate hike. The clearest source of strength was business

investment: our data indicate U.S. business spending rose at a 15.8% annualized rate, with corporate information technology

services up 28.3%. AI-related investment remains the primary driver—compute capex has grown at an 80% annualized rate

since year-end 2024, and data center real estate is now roughly 3.8x its year-end 2022 level. This spending surge is also bidding

away finite resources—grid capacity, engineering talent, construction labor, and key materials—raising input costs and creating

headwinds for competing capital projects.

European conditions stabilized as the quarter progressed. German factory orders, while still negative, rebounded from

post-conflict troughs, and euro area order books improved, signaling firmer forward demand. A notable structural development

was the agreement by the EU’s six largest economies on capital markets integration, which could mobilize an estimated €8

trillion of household savings currently held in low-yielding deposits toward more productive investment. In China, domestic

consumption continued to contract, with weakness particularly evident in big-ticket categories previously supported by trade-in

subsidies. Exports remained the structural growth driver, with export growth to the U.S. turning positive for the first time since

the 2025 trade war. Taiwan and South Korea continue to benefit from AI-linked semiconductor demand—South Korean

semiconductor exports are growing at a record 180% annual rate—though concentration risk remains elevated, with Samsung

and SK Hynix’s combined market cap reaching approximately 135% of South Korea’s GDP. Japan has also benefited from AI-

related export growth, and recent moves in the yen and JGB yields appear to reflect a gradual normalization rather than a

sovereign or currency crisis. In India, growth appears resilient, but the country’s reliance on imported oil and gas leaves it

exposed to renewed energy supply disruptions.

Merger and acquisition (“M&A”) activity in the first half of 2026 surpassed the record aggregate deal value set in the

first half of 2021, though those headline figures increasingly reflected a relatively small number of large transactions.

Transactions totaled $1.75 trillion, a 23% increase quarter-over-quarter and a 66% increase over the same period a year ago,

even as transaction counts declined 15% quarter-over-quarter and 12% year-over-year. Leveraged buyout (“LBO”) activity was

more subdued. U.S. buyouts slowed in the second quarter, with deal volume falling 45% from the first quarter as managers

digested higher energy prices and saw hopes for Fed rate cuts fade. European buyouts helped take up the slack, with volume

increasing 51% in EMEA to exceed the U.S. by more than $13 billion. Exit activity remained constrained—announced buyout

exit value of $245 billion declined 23% quarter-over-quarter, and the 595 companies divested globally represented the lowest

quarterly count since 2020. However, median exit EBITDA multiples continued to improve, rising to a range of 14.7x to 17.6x

for deals exited in the fourth quarter of 2025 and first quarter of 2026 (the latest data available), compared to a range of 11.0x to

13.0x over much of 2022 through 2024. Meanwhile, initial public offering (“IPO”) activity was a bright spot, with 39 operating

company IPOs on U.S. exchanges generating $117 billion in proceeds, an 86% increase in transaction count versus Q1 2026.

SpaceX’s $86 billion IPO—22 years after founding—was emblematic of broader structural trends: private markets are

capturing an increasing share of value creation before listing, while passive investing is exerting a growing influence on public

market behavior.

Credit markets demonstrated broad resilience during the quarter, with improving conditions across most sectors even

as differentiation increased. Broader credit quality continued to improve: leveraged loan defaults plus distressed exchanges fell

to their lowest level in over three years at 2.77%, while the weighted average bid on the U.S. leveraged loan market ended the

quarter at 94.96, modestly below its year-end 2025 level of 96.64 but essentially unchanged from 95 at the end of the first

quarter. Amendment activity (repricings and extensions) also remained relatively steady from the first quarter, as a more than

doubling of extensions largely offset a decline in refinancings. Notably, weakness remained concentrated rather than broad-

based. Excluding software, the average secondary bid firmed by roughly 0.4 points over the quarter, while software loans fell

approximately 1.9 points, widening the gap between software and the rest of the index to a historically wide 9.6 points. CLO

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new issuance moderated from last year’s pace amid tight loan spreads and continued uncertainty around software and energy

exposures.

In the second quarter of 2026, we deployed $14.3 billion across our platform and $53.0 billion over the last twelve

months. In our traditional carry funds, we realized proceeds of $6.7 billion in the second quarter of 2026 and $36.8 billion over

the last twelve months, including $2.9 billion and $15.3 billion, respectively, in our corporate private equity strategy. We had

$16.8 billion in inflows in the second quarter of 2026 and $55.8 billion in inflows over the last twelve months as of June 30,

2026. Inflows over the last twelve months include $7.3 billion in our evergreen wealth products, which had $20.1 billion in

assets under management as of June 30, 2026, a 64% increase from one year ago.

Our carry fund portfolio appreciated 3% in the second quarter. Within our Global Private Equity segment in the second

quarter, our corporate private equity funds appreciated 2% as market price decreases in certain publicly traded positions offset

appreciation elsewhere, our infrastructure & natural resources funds appreciated 6% driven by our international energy funds

and appreciation in the NGP Carry funds, and our real estate funds were flat. Our Global Credit carry funds, which represent

approximately 11% of the total Global Credit remaining fair value as of June 30, 2026, appreciated 4% in the second quarter.

Carry funds in our Carlyle AlpInvest segment appreciated 3% in the second quarter.

Notable Developments

Dividends

In July 2026, our Board of Directors declared a quarterly dividend of $0.35 per share to common stockholders of record

at the close of business on August 17, 2026, payable on August 26, 2026.

Global Private Equity Structured Investment Vehicle

During the second quarter of 2026, the Company completed the structuring of an investment vehicle in our Global Private

Equity segment, which created liquidity for our fund investors and raised capital earmarked for our next vintage U.S. buyout

fund. In connection with the transaction, the Company recognized portfolio advisory and transaction fees in our Global Credit

segment results during the quarter. Additionally, the Company transferred interests in certain fund-related entities to the vehicle,

which are reflected as a component of non-controlling interests in consolidated entities on our condensed consolidated balance

sheet as of June 30, 2026.

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Key Financial Measures

Our key financial measures and operating metrics are discussed in the following pages. Additional information regarding

U.S. GAAP measures and our other significant accounting policies can be found in Note 2, Summary of Significant Accounting

Policies, to the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.

Revenues

Revenues primarily consist of Fund management fees, Incentive fees, Investment income (including Performance

allocations, realized and unrealized gains of our investments in our funds, and other principal investments), as well as Interest

and other income.

Fund management fees. Fund management fees include management fees and transaction and portfolio advisory fees. We

earn management fees for advisory services we provide to funds in which we hold a general partner interest or to funds or

certain portfolio companies with which we have an investment advisory or investment management agreement. These fees are

largely from either traditional closed-end, long-dated funds, which are highly predictable and stable, or Perpetual Capital

products as defined below. Management fees also include catch-up management fees, which are episodic in nature and

represent management fees charged to fund investors in subsequent closings of a fund which apply to the time period between

the fee initiation date and the subsequent closing date. We also earn management fees on our CLOs and other structured

products.

Transaction and portfolio advisory fees generally include capital markets fees generated by Carlyle Global Capital

Markets in connection with activities related to the underwriting, issuance and placement of debt and equity securities, and loan

syndication for our portfolio companies and third-party clients, which are generally not subject to rebate offsets as described

below. Underwriting fees include gains, losses, and fees arising from securities offerings in which we participate in the

underwriter syndicate.

Transaction and portfolio advisory fees also include fees we receive for the transaction and portfolio advisory services we

provide to our portfolio companies. When covered by separate contractual agreements, we recognize transaction and portfolio

advisory fees for these services when the performance obligation has been satisfied and collection is reasonably assured. We are

generally required to offset our fund management fees by the transaction and advisory fees earned, which we refer to as “rebate

offsets.”

The recognition of portfolio advisory fees, transactions fees, and capital markets fees can be volatile as they are primarily

generated by investment activity within our funds, and therefore are impacted by our investment pace or other capital

transactions at our portfolio companies.

Incentive fees. Incentive fees consist of performance-based incentive arrangements pursuant to management contracts

when the return on assets under management exceeds certain benchmark returns or other performance targets. In such

arrangements, incentive fees are recognized when the performance benchmark has been achieved.

Investment income (loss). Investment income (loss) consists of our performance allocations as well as the realized and

unrealized gains and losses resulting from our equity method investments and other principal investments.

Performance allocations consist principally of the performance-based capital allocation from fund limited partners to us,

commonly referred to as carried interest, from certain of our investment funds, which we refer to as “carry funds.” Carried

interest revenue is recognized by Carlyle upon appreciation of the valuation of our funds’ investments above certain return

hurdles as set forth in each respective fund partnership agreement and is based on the amount that would be due to us pursuant

to the fund partnership agreement at each period end as if the funds were liquidated at such date. Accordingly, the amount of

carried interest recognized as performance allocations reflects our share of the fair value gains and losses of the associated

funds’ underlying investments measured at their then-current fair values relative to the fair values as of the end of the prior

period. As a result, the performance allocations earned in an applicable reporting period are not indicative of any future period,

as fair values are based on conditions prevalent as of the reporting date. Refer to “—Trends Affecting Our Business” for further

discussion.

For any given period, performance allocations revenue on our statement of operations may include reversals of previously

recognized performance allocations due to a decrease in the value of a particular fund that results in a decrease of cumulative

performance allocations earned to date. Since fund return hurdles are cumulative, previously recognized performance

allocations also may be reversed in a period of appreciation that is lower than the particular fund’s hurdle rate. Additionally,

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unrealized performance allocations reverse when performance allocations are realized, and unrealized performance allocations

can be negative if the amount of realized performance allocations exceed total performance allocations generated in the period.

The timing and receipt of realized performance allocations varies with the lifecycle of our carry funds and there is often a

difference between the time we start accruing performance allocations and realization. The timing of performance allocation

realizations from our Carlyle AlpInvest, Carlyle Aviation, and Abingworth funds is typically later than in our other carry funds

based on the terms of such arrangements.

Under our arrangements with the historical owners and management teams of AlpInvest and Abingworth, the amount of

carried interest to which we are entitled varies. In some cases, we are entitled to 15% of the carried interest in respect of

commitments from the historical owners of AlpInvest for the period between 2011 and 2020. In certain instances, carried

interest associated with the AlpInvest fund vehicles is subject to entity level income taxes in the Netherlands. Additionally, we

are entitled to 15% of carried interest generated from certain Abingworth funds.

Accrued performance allocations and accrued giveback obligations at a point in time assume a hypothetical liquidation of

the funds’ investments at their then-current fair values. Each investment fund is considered separately in evaluating carried

interest and potential giveback obligations. These assets and liabilities will continue to fluctuate in accordance with the fair

values of the funds’ investments until they are realized. The Company uses “net accrued performance revenues” to refer to the

aggregation of the accrued performance allocations net of (i) accrued giveback obligations, (ii) accrued performance allocations

related compensation, (iii) performance allocations related tax obligations, and (iv) accrued performance allocations attributable

to non-controlling interests. Net accrued performance revenues exclude any net accrued performance allocations and incentive

fees that have been realized but will be collected in subsequent periods, as well as net accrued performance revenues which are

presented as fee related performance revenues when realized in our non-GAAP financial measures. Realized performance

allocation-related compensation that has not yet been paid is also excluded from our net accrued performance allocations.

In addition, realized performance allocations may be reversed in future periods if a fund’s investment values decline

below certain return hurdles, which vary from fund to fund, and become subject to a giveback obligation. See Note 7,

Commitments and Contingencies, for more information. The aggregate amount of giveback obligations realized since Carlyle’s

inception totaled $264.6 million, $181.8 million of which was related to various Legacy Energy Funds. Given that current and

former senior Carlyle professionals and other limited partners of the Carlyle Holdings partnerships are responsible for paying

the majority of the realized giveback obligation, only $88.5 million of the $264.6 million aggregate giveback obligation realized

since inception was attributable to Carlyle. The realization of giveback obligations for the Company’s portion of such

obligations reduces Distributable Earnings in the period realized. Further, each individual who holds equity interests in carried

interest generated by our funds and is a recipient of realized carried interest typically signs a guarantee agreement or partnership

agreement that personally obligates such person to return his/her pro rata share of any amounts of realized carried interest

previously distributed that are later clawed back. Accordingly, carried interest as performance allocation compensation is

subject to return to the Company in the event a giveback obligation is funded. Generally, the actual giveback liability, if any,

does not become due until the end of a fund’s life.

In addition, in our discussion of our non-GAAP results, we use the term “realized net performance revenues” to refer to

realized performance allocations and incentive fees from our funds, net of (i) amounts allocated to our investment professionals

and other employees, (ii) non-controlling interests, and (iii) certain tax expenses associated with carried interest attributable to

certain partners and employees, which are reflected as realized performance allocations and incentive fees related compensation

expense. See “—Non-GAAP Financial Measures” and “—Segment Analysis” for the amount of realized net performance

revenues recognized each period and related discussion.

Investment income also represents the realized and unrealized gains and losses on our principal investments and our

strategic investments in NGP as described below. Realized principal investment income (loss) is recorded when we redeem all

or a portion of our investment or when we receive or are due cash income, such as dividends or distributions. A realized

principal investment loss is also recorded when an investment is deemed to be permanently impaired or worthless. Unrealized

principal investment income (loss) results from changes in the fair value of the underlying investment, as well as the reversal of

previously recognized unrealized gains (losses) at the time an investment is realized.

We account for our investments in NGP under the equity method of accounting. Our investments in NGP include the

equity interests in NGP Management and the general partners of certain carry funds advised by NGP, which entitle us to an

allocation of up to 55.0% of the management fee revenues earned by NGP Management in certain funds, and up to 47.5% of the

performance allocations received by certain NGP fund general partners. For further information regarding our strategic

investments in NGP and the Restructuring, refer to Note 4, Investments, to the condensed consolidated financial statements

included in this Quarterly Report on Form 10-Q.

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We record investment income (loss) for our equity income allocation from NGP management fee related revenues and

our share of any allocated expenses from NGP Management, as well as expenses associated with the compensatory elements of

the strategic investment and any impairment charges. We also record our equity income allocation from NGP performance

allocations in principal investment income (loss) from equity method investments rather than performance allocations in our

condensed consolidated statements of operations. We do not control or manage NGP. Moreover, we do not operate NGP’s

business, have representation on NGP’s board or serve as an investment advisor to any investment fund sponsored by NGP, nor

do we direct the operations of any of NGP’s portfolio companies. While we have consent rights over certain major actions by

NGP outside of the ordinary course of NGP’s business (including, for example, consent rights over items such as amendments

to the organizational documents of the entity in which we are invested, changes to the management fee streams earned by NGP

under its fund agreements, or the incurrence of certain debt by NGP and other similar items), we have no voting rights or

consent rights on any NGP investment committee that selects investments to be made by NGP funds.

Interest and other income. Interest and other income primarily represents reimbursement of certain costs incurred on

behalf of our funds, as well as interest income that we earn such as from our cash and money market accounts and other

investments, including CLO senior and subordinated notes.

Interest and other income of Consolidated Funds. Interest and other income of Consolidated Funds primarily represents

the interest earned on assets of consolidated CLOs. Our CLOs generate interest income primarily from investments in bonds

and loans, inclusive of amortization of discounts, and generate other income from consent and amendment fees.

Net investment income (loss) of Consolidated Funds. Net investment income (loss) of Consolidated Funds generally

measures the change in the difference in fair value between the assets and the liabilities of the Consolidated Funds. Income

(loss) indicates that the fair value of the assets of the Consolidated Funds appreciated more (less), or depreciated less (more),

than the fair value of the liabilities of the Consolidated Funds. Income or loss is not necessarily indicative of the investment

performance of the Consolidated Funds and does not impact the management or incentive fees received by Carlyle for its

management of the Consolidated Funds. The portion of the net investment income (losses) of Consolidated Funds attributable

to the limited partner investors is allocated to non-controlling interests. Moreover, although the assets of the Consolidated

Funds are consolidated onto our balance sheet pursuant to U.S. GAAP, ultimately we do not have recourse to such assets and

such liabilities are generally non-recourse to us. Therefore, income or loss is not expected to have a material impact on the

revenues or profitability of, or the assets available to, the Company beyond the Company’s capital invested in the Consolidated

Funds.

Expenses

Compensation and benefits. Compensation includes salaries, bonuses, equity-based compensation, and performance

payment arrangements. Bonuses are accrued over the service period to which they relate.

We recognize as compensation expense the portion of performance allocations and incentive fees that are due to our

employees, senior Carlyle professionals, advisors, and operating executives in a manner consistent with how we recognize the

performance allocations and incentive fee revenue. These amounts are accounted for as compensation expense in conjunction

with the related performance allocations and incentive fee revenue and, until paid, are recognized as a component of the accrued

compensation and benefits liability. Compensation in respect of performance allocations and incentive fees is paid when the

related performance allocations and incentive fees are realized, and not when such performance allocations and incentive fees

are accrued. The funds do not have a uniform allocation of performance allocations and incentive fees to our employees, senior

Carlyle professionals, advisors, and operating executives. However, we generally allocate a range of 60% to 70% of

performance allocations and incentive fees to our employees.

In addition, we have implemented various equity-based compensation arrangements that require senior Carlyle

professionals and other employees to provide services over a service period of generally one year to four years in order to vest

in the applicable equity interests, which under U.S. GAAP will result in compensation charges over current and future periods.

In certain of our equity-based compensation arrangements, vesting is based on the achievement of certain performance targets

or market conditions (see Note 13, Equity-Based Compensation, for additional information). Compensation charges associated

with all equity-based compensation grants are excluded from Fee Related Earnings and Distributable Earnings.

We may hire additional individuals and overall compensation levels may correspondingly increase, which could result in

an increase in compensation and benefits expense. As a result of prior acquisitions, we have charges associated with contingent

consideration taking the form of earn-outs and profit participation, some of which are reflected as compensation expense.

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General, administrative and other expenses. General, administrative and other expenses include occupancy and

equipment expenses and other expenses, which consist principally of professional fees, including those related to our global

regulatory compliance program, external costs of fundraising, travel and related expenses, communications and information

services, depreciation and amortization (including intangible asset amortization and impairment), bad debt expense, and foreign

currency transactions. We expect that general, administrative and other expenses will vary due to infrequently occurring or

unusual items, such as impairment of intangible assets or lease right-of-use assets and expenses or insurance recoveries

associated with litigation and contingencies. Also, in periods of significant fundraising, to the extent that we use third parties to

assist in our fundraising efforts, our general, administrative and other expenses may increase accordingly. Similarly, our

general, administrative and other expenses may increase as a result of professional and other fees incurred as part of due

diligence related to strategic acquisitions and new product development. Additionally, we anticipate that general, administrative

and other expenses will fluctuate from period to period due to the impact of foreign exchange transactions.

Interest and other expenses of Consolidated Funds. Interest and other expenses of Consolidated Funds consist primarily

of interest expense related primarily to loans of consolidated CLOs and other consolidated funds, professional fees and other

third-party expenses.

Income taxes. The Carlyle Group Inc. is a corporation for U.S. federal income tax purposes and thus is subject to U.S.

federal, state, and local corporate income taxes. The interim provision for income taxes is generally calculated using an

estimated annual effective tax rate applied to year-to-date ordinary income in accordance with ASC 740, Income Taxes.

Non-controlling Interests in Consolidated Entities. Non-controlling interests in consolidated entities represent the

component of equity in consolidated entities not held by us.

Earnings Per Common Share. We compute earnings per common share in accordance with ASC 260, Earnings Per

Share. Basic earnings per common share is calculated by dividing net income (loss) attributable to the common shares of the

Company by the weighted average number of common shares outstanding for the period. Diluted earnings per common share

reflects the assumed conversion of all dilutive securities. See Note 11, Earnings Per Common Share, to the condensed

consolidated financial statements in this Quarterly Report on Form 10-Q for more information.

Non-GAAP Financial Measures

Distributable Earnings. Distributable Earnings, or “DE,” is a key performance benchmark used in our industry and is

evaluated regularly in making resource deployment and compensation decisions, and in assessing the performance of our three

segments. We also use DE in our budgeting, forecasting, and the overall management of our segments. We believe that

reporting DE is helpful to understanding our business and that investors should review the same supplemental financial measure

that management uses to analyze our segment performance. DE is intended to show the amount of net realized earnings without

the effects of consolidation of the Consolidated Funds. DE is derived from our segment reported results and is an additional

measure to assess performance.

Distributable Earnings differs from income (loss) before provision for income taxes computed in accordance with U.S.

GAAP in that it includes certain tax expenses associated with certain foreign performance revenues (composed of performance

allocations and incentive fees), and does not include unrealized performance allocations and related compensation expense,

unrealized principal investment income, equity-based compensation expense, net income (loss) attributable to non-Carlyle

interest in consolidated entities, or charges (credits) related to Carlyle corporate actions and non-recurring items that affect

period-to-period comparability and are not reflective of the Company’s operational performance. Charges (credits) related to

Carlyle corporate actions and non-recurring items include: charges associated with the Conversion, charges associated with

acquisitions, dispositions, or strategic investments, changes in the tax receivable agreement liability, amortization and any

impairment charges associated with acquired intangible assets, transaction costs associated with acquisitions and dispositions,

charges associated with earn-outs and contingent consideration including gains and losses associated with the estimated fair

value of contingent consideration issued in conjunction with acquisitions or strategic investments, impairment charges

associated with lease right-of-use assets, gains and losses from the retirement of debt, charges associated with contract

terminations and employee severance, and non-recurring items that affect period-to-period comparability and are not reflective

of the Company’s operating performance. We believe the inclusion or exclusion of these items provides investors with a

meaningful indication of our core operating performance. This measure supplements and should be considered in addition to

and not in lieu of the results of operations discussed further under “—Consolidated Results of Operations” prepared in

accordance with U.S. GAAP.

Fee Related Earnings. Fee Related Earnings, or “FRE,” is a component of DE and is used to assess the ability of the

business to cover base compensation and operating expenses from total fee revenues. FRE adjusts DE to exclude net realized

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performance revenues, realized principal investment income from investments in Carlyle funds, and net interest (interest

income less interest expense). Fee Related Earnings includes fee related performance revenues and related compensation

expense. Fee related performance revenues represent the realized portion of performance revenues that are measured and

received on a recurring basis, are not dependent on realization events, and which have no risk of giveback.

Operating Metrics

We monitor certain operating metrics that are common to the asset management industry.

Fee-earning Assets under Management. Fee-earning assets under management or Fee-earning AUM refers to the assets

we manage or advise from which we derive recurring fund management fees. Our Fee-earning AUM is generally based on one

of the following, once fees have been activated:

(a) the amount of limited partner capital commitments, generally for carry funds where the original investment period

has not expired and for AlpInvest carry funds during the commitment fee period (see “Fee-earning AUM based on

capital commitments” in the table below for the amount of this component at each period);

(b) the remaining amount of limited partner invested capital at cost, generally for carry funds and certain co-

investment vehicles where the original investment period has expired (see “Fee-earning AUM based on invested

capital” in the table below for the amount of this component at each period);

(c) the amount of aggregate fee-earning collateral balance at par of our CLOs and other securitization vehicles, as

defined in the fund indentures (pre-2020 CLO vintages are generally exclusive of equities and defaulted positions)

as of the quarterly cut-off date;

(d) the external investor portion of the net asset value of certain carry funds and evergreen products (see “Fee-earning

AUM based on net asset value” in the table below for the amount of this component at each period);

(e) the fair value of Fortitude’s general account assets invested under the strategic advisory services agreement (see

“Fee-earning AUM based on fair value and other” in the table below);

(f) the gross assets (including assets acquired with leverage) of certain cross-platform credit and direct lending

products, excluding cash and cash equivalents for one of our business development companies (included in “Fee-

earning AUM based on fair value and other” in the table below); and

(g) the lower of cost or fair value of invested capital, generally for AlpInvest carry funds where the commitment fee

period has expired and certain carry funds where the investment period has expired, (included in “Fee-earning

AUM based on fair value and other” in the table below).

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The chart below presents Fee-earning AUM by segment at each period, in billions.

The table below details Fee-earning AUM by its respective components at each period.

(Dollars in millions)

(1) Ending balances as of June 30, 2026 and 2025 exclude $27.6 billion and $17.6 billion, respectively, of Pending Fee-earning AUM for

which fees have not yet been activated.

The table below provides the period to period rollforward of Fee-earning AUM.

(Dollars in millions)

(1) Inflows represents limited partner capital raised by our carry funds or separately managed accounts for which management fees based on

commitments were activated during the period, the fee-earning commitments invested in vehicles for which management fees are based

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on invested capital, incremental fee-earning collateral from new CLO issuances and resets, reinsurance and other transactions at

Fortitude, as well as gross subscriptions in vehicles for which management fees are based on net asset value. Inflows exclude fundraising

amounts during the period for which fees have not yet been activated, which are referenced as Pending Fee-earning AUM.

(2) Outflows represents the impact of realizations from vehicles with management fees based on remaining invested capital at cost or fair

value, changes in basis for funds where the investment period, weighted-average investment period or commitment fee period has

expired during the period, reductions for funds that are no longer calling for fees, gross redemptions in our evergreen funds, and outflows

from our liquid credit products. Distributions for funds earning management fees based on commitments during the period do not affect

Fee-earning AUM.

(3) Market Activity & Other represents realized and unrealized gains (losses) on portfolio investments in our carry funds based on the lower

of cost or fair value and net asset value, activity of funds with fees based on gross asset value, and changes in the fair value of Fortitude’s

general account assets covered by the strategic advisory services agreement.

(4) Foreign Exchange represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated

funds. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of the

period end.

Refer to “—Segment Analysis” for a detailed discussion by segment of the activity affecting Fee-earning AUM for each

of the periods presented by segment.

Assets under Management. Assets under management or “AUM” refers to the assets we manage or advise. Our AUM

generally equals the sum of the following:

(a) the aggregate fair value of our carry funds and related co-investment vehicles, and separately managed accounts, plus

the capital that Carlyle is entitled to call from investors in those funds and vehicles (including Carlyle commitments to

those funds and vehicles and those of senior Carlyle professionals and employees) pursuant to the terms of their capital

commitments to those funds and vehicles;

(b) the amount of aggregate collateral balance and principal cash at par or aggregate principal amount of the notes of our

CLOs and other structured products (inclusive of all positions);

(c) the net asset value of certain carry funds and evergreen products;

(d) the fair value of Fortitude’s general account assets invested under the strategic advisory services agreement; and

(e) the gross assets (including assets acquired with leverage) of certain cross-platform credit and direct lending products,

plus the capital that Carlyle is entitled to call from investors in those vehicles pursuant to the terms of their capital

commitments to those vehicles.

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The chart below presents Total AUM by segment at each period, in billions.

We include in our calculation of AUM and Fee-earning AUM the NGP Energy Funds that are advised by NGP. Our

calculation of AUM also includes third-party capital raised for the investment in Fortitude through a Carlyle-affiliated

investment fund and from strategic investors who directly invest in Fortitude alongside the fund. The AUM and Fee-earning

AUM related to the strategic advisory services agreement with Fortitude are inclusive of the net asset value of investments in

Carlyle products. These amounts are also reflected in the AUM and Fee-earning AUM of the strategy in which they are

invested.

For most of our Global Private Equity and Carlyle AlpInvest carry funds, total AUM includes the fair value of the capital

invested, whereas Fee-earning AUM includes the amount of capital commitments or the remaining amount of invested capital,

depending on whether the original investment period for the fund has expired. As such, Fee-earning AUM may be greater than

total AUM when the aggregate fair value of the remaining investments is less than the cost of those investments.

Our calculations of AUM and Fee-earning AUM may differ from the calculations of other asset managers. As a result,

these measures may not be comparable to similar measures presented by other asset managers. In addition, our calculation of

AUM (but not Fee-earning AUM) includes uncalled commitments to, and the fair value of invested capital in, our investment

funds from Carlyle and our personnel, regardless of whether such commitments or invested capital are subject to management

fees or performance allocations. Our calculations of AUM and Fee-earning AUM are not based on any definition of AUM or

Fee-earning AUM that is set forth in the agreements governing the investment funds that we manage or advise.

We generally use Fee-earning AUM as a metric to measure changes in the assets from which we earn recurring

management fees. Total AUM tends to be a better measure of our investment and fundraising performance as it reflects

investments at fair value plus available capital.

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The table below provides the period to period rollforward of Total AUM.

(Dollars in millions)

(1) Inflows generally reflects the impact of gross fundraising, reinsurance and other transactions at Fortitude, and corporate acquisitions

during the period, if any. For funds or vehicles denominated in foreign currencies, this reflects translation at the average quarterly rate.

(2) Outflows includes distributions net of recallable or recyclable amounts in our carry funds, related co-investment vehicles, and separately

managed accounts, gross redemptions in our evergreen products, outflows from our liquid credit products, and the expiration of available

capital.

(3) Market Activity & Other generally represents realized and unrealized gains (losses) on portfolio investments in our carry funds and

related co-investment vehicles, and separately managed accounts, as well as the net impact of fees, expenses and non-investment income,

change in gross asset value for our business development companies, changes in the fair value of Fortitude’s general account assets

covered by the strategic advisory services agreement, and other changes in AUM.

(4) Foreign Exchange represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated

funds. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of the

period end.

Please refer to “—Segment Analysis” for a detailed discussion by segment of the activity affecting Total AUM for each

of the periods presented.

*Available Capital. “*Available Capital” refers to the amount of capital commitments available to be called for investments,

which may be reduced for equity invested that is funded via a fund credit facility and expected to be called from investors at a

later date, plus any additional assets/liabilities at the fund level other than active investments. Amounts previously called may

be added back to available capital following certain distributions. “Expired Available Capital” occurs when a fund has passed

the investment and follow-on periods and can no longer invest capital into new or existing deals. Any remaining Available

Capital, typically a result of either recycled distributions or specific reserves established for the follow-on period that are not

drawn, can only be called for fees and expenses and is therefore removed from the Total AUM calculation.

*Perpetual Capital. “*Perpetual Capital” refers to the assets we manage or advise which have an indefinite term and for

which there is no immediate requirement to return capital to investors upon the realization of investments made with such

capital, except as required by applicable law. Perpetual Capital may be materially reduced or terminated under certain

conditions, including reductions from changes in valuations and payments to investors, including through elections by investors

to redeem their investments, dividend payments, and other payment obligations, as well as the termination of or failure to renew

the respective investment advisory agreements. Perpetual Capital includes: (a) assets managed under the strategic advisory

services agreement with Fortitude, (b) our Core Plus real estate fund, (c) our business development companies and certain other

direct lending products, (d) Carlyle Tactical Private Credit Fund (“CTAC”), (e) our closed-end tender offer Carlyle AlpInvest

Private Markets (“CAPM”) funds and Carlyle AlpInvest Private Markets Secondaries (“CAPS”) funds, and (f) certain other

structured credit and asset-backed finance products. As of June 30, 2026, our total AUM and Fee-earning AUM included

$119.7 billion and $113.2 billion, respectively, of Perpetual Capital. Our Perpetual Capital total AUM and Fee-earning AUM,

exclusive of assets managed under the strategic advisory services agreement with Fortitude, was $39.9 billion and $33.5 billion,

respectively, as of June 30, 2026.

*Performance Fee Eligible AUM. “*Performance Fee Eligible AUM” represents the AUM of funds for which we are

entitled to receive performance allocations, inclusive of the fair value of investments in those funds (which we refer to as

“Performance Fee Eligible Fair Value”) and their Available Capital. Performance Fee Eligible Fair Value is “Performance Fee-

Generating” when the associated fund has achieved the specified investment returns required under the terms of the fund’s

agreement and is accruing performance revenue as of the quarter-end reporting date. Funds whose performance allocations are

treated as fee related performance revenues are excluded from these metrics. As of June 30, 2026, our total AUM included

$236.6 billion of Performance Fee Eligible AUM.

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Consolidation of Certain Carlyle Funds

The Company consolidates all entities that it controls either through a majority voting interest or as the primary

beneficiary of variable interest entities. The fund entities we consolidate are referred to collectively as the Consolidated Funds

in our condensed consolidated financial statements. The assets and liabilities of the Consolidated Funds are generally held

within separate legal entities and, as a result, the assets of the Consolidated Funds are not available to support our operating

activities and similarly the liabilities of the Consolidated Funds are non-recourse to us. As of June 30, 2026, our Consolidated

Funds represent approximately 4% of our AUM; 2% and 2% of our management fees for the three and six months ended June

30, 2026, respectively; and 20% and 18% of our total investment income or loss on an unconsolidated basis for the three and six

months ended June 30, 2026, respectively.

We are not required under the consolidation guidance to consolidate in our financial statements most of the investment

funds we advise. However, we consolidate certain CLOs and certain other funds that we advise, and the number of funds we are

required to consolidate has been increasing as a result of the impacts of capital from our balance sheet invested in new products

and our indirect interest in funds through our investment in Fortitude (see Note 4, Investments). As of June 30, 2026, the assets

and liabilities of the Consolidated Funds were primarily related to our consolidated CLOs, which held approximately $10.9

billion of total assets. Additionally, the Investments of Consolidated Funds included approximately $1.1 billion related to

investments that have been bridged to investment funds in our Global Private Equity segment.

Generally, the consolidation of the Consolidated Funds has a gross-up effect on our assets, liabilities and cash flows but

has no net effect on the net income attributable to the Company beyond the capital contributed by the Company to the

Consolidated Funds. The majority of the net economic ownership interests of the Consolidated Funds are reflected as non-

controlling interests in consolidated entities in the condensed consolidated financial statements. However, in certain

Consolidated Funds, particularly those where we have elected to invest additional amounts or bridge investments in new

investment areas, the non-controlling interests are less significant and may impact net income attributable to the common

stockholders.

The Consolidated Funds are not the same entities in all periods presented. The Consolidated Funds in future periods may

change due to changes in fund terms, formation of new funds, and terminations of funds. Because only a small portion of our

funds are consolidated, the performance of the Consolidated Funds is not necessarily consistent with or representative of the

combined performance trends of all of our funds.

For further information on our consolidation policy and the consolidation of certain funds, see Note 2, Summary of

Significant Accounting Policies, to the condensed consolidated financial statements included in this Quarterly Report on

Form 10-Q.

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Consolidated Results of Operations

The following table and discussion sets forth information regarding our condensed consolidated results of operations for

the three and six months ended June 30, 2026 and 2025. Our condensed consolidated financial statements have been prepared

on substantially the same basis for all historical periods presented; however, the Consolidated Funds are not the same entities in

all periods shown due to changes in fund terms and the creation and termination of funds. As further described above, the

consolidation of these funds primarily has the impact of increasing interest and other income of Consolidated Funds, interest

and other expenses of Consolidated Funds, and net investment income (losses) of Consolidated Funds in the year that the fund

is initially consolidated. The consolidation of these funds had no effect on net income attributable to the Company for the

periods presented.

(Dollars in millions)

NM - Not meaningful

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Revenues

Fund management fees. The following table provides the components of the changes in Fund management fees for the

periods presented:

(Dollars in millions)

(1) The three and six months ended June 30, 2025 included approximately $19 million of aviation catch-up subordinated management fees.

(2) Total increase in Fund management fees does not include our equity income allocation from NGP management fee related revenues. We do not control

NGP and account for our strategic investment in NGP as an equity method investment under U.S. GAAP. Therefore, Fund management fees associated

with NGP are included in Principal investment income (loss) in our U.S. GAAP results.

No fund generated over 10% of total fund management fees in any of the periods presented. Fee-earning AUM as of

June 30, 2026 increased in Carlyle AlpInvest and Global Credit and decreased in Global Private Equity as compared to June 30,

2025, reflecting a diversified fund management fee base across our three business segments.

Fund management fees included transaction and portfolio advisory fees, net of rebate offsets, of $108.5 million and $45.8

million for the three months ended June 30, 2026 and 2025, respectively, and $157.8 million and $122.5 million for the six

months ended June 30, 2026 and 2025, respectively. These fees primarily comprise capital markets fees generated by Carlyle

Global Capital Markets. The recognition of portfolio advisory fees, transactions fees, and capital markets fees can be volatile as

they are primarily generated by investment activity within our funds, and therefore are impacted by our investment pace. See

“—Trends Affecting Our Business” for further discussion on our investment activity and broader market trends.

Incentive fees. Incentive fees increased $58.4 million for the three months ended June 30, 2026, as compared to the three

months ended June 30, 2025, and increased $66.9 million for the six months ended June 30, 2026, as compared to the six

months ended June 30, 2025, primarily due to catch-up fees from the restructuring of certain incentive fee arrangements in the

Global Credit segment, as well as the growth and performance of the CAPM and CAPS evergreen funds in the Carlyle

AlpInvest segment.

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Investment income (loss). The components of Investment income (loss) are included in the following table:

(Dollars in millions)

Performance allocations. Performance allocations by segment for the three and six months ended June 30, 2026 and 2025

comprised the following:

(Dollars in millions)

Performance allocations for the three and six months ended June 30, 2026 included the following:

• In the Global Private Equity segment, for the three and six months ended June 30, 2026, reversals of Performance

allocations were primarily attributable to declines in CP VII’s accrued performance allocations, largely due to

decreases in the market price of certain public investments and the impact of preferred return, partially offset by

accruals of Performance allocations resulting from appreciation in our international energy funds, CJP IV, CP VIII,

CP Growth I, CGP II, and CETP III.

• In the Global Credit segment, for the three and six months ended June 30, 2026, Performance allocation accruals

were primarily driven by appreciation in CCOF III, SASOF IV, and SASOF V.

• In the Carlyle AlpInvest segment, for the three and six months ended June 30, 2026, Performance allocation accruals

were primarily driven by appreciation in our secondaries & portfolio finance funds, partially offset by declines in

ACF VIII due to the impact of preferred return.

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Performance allocations for the three and six months ended June 30, 2025 included the following:

• In the Global Private Equity segment, for the three months ended June 30, 2025, Performance allocation accruals

were primarily driven by appreciation in CAP V, CP VII, and CP VIII. For the six months ended June 30, 2025,

Performance allocation accruals were primarily driven by appreciation in CP VII and CP VIII.

• In the Global Credit segment, for the three and six months ended June 30, 2025, Performance allocation accruals

were primarily driven by appreciation in SASOF V and CCOF II.

• In the Carlyle AlpInvest segment, for the three and six months ended June 30, 2025, Performance allocation accruals

were primarily driven by appreciation in our secondaries & portfolio finance and co-investment funds.

See “—Trends Affecting Our Business” for further discussion on the macroeconomic, geopolitical and industry

landscape, and our investment activity.

Principal investment income (loss). Principal investment income for the three months ended June 30, 2026 and 2025 was

primarily attributable to performance allocations on funds managed by NGP. Principal investment income for the six months

ended June 30, 2026 was primarily attributable to performance allocations on funds managed by NGP. Principal investment

loss for the six months ended June 30, 2025 was primarily attributable to an impairment charge of $92.5 million and a

$38.0 million reduction in NGP accrued carry, both of which negatively impacted the six months ended June 30, 2025 as a

result of the restructuring of the terms of our strategic investment in NGP (see Note 4, Investments, for more information).

Interest and other income of Consolidated Funds. Interest and other income of Consolidated Funds increased $29.5

million for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, and increased $75.8

million for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, primarily driven by an

increase in interest income from our consolidated CLOs.

Expenses

Compensation and benefits. Total compensation and benefits decreased $303.4 million for the three months ended June

30, 2026, as compared to the three months ended June 30, 2025, and decreased $817.7 million for the six months ended June

30, 2026, as compared to the six months ended June 30, 2025. The decrease for the three and six months ended June 30, 2026

relative to the comparable prior year period is primarily attributable to a decrease in Performance allocations and incentive fee

related compensation of $350.0 million and $889.3 million, respectively, which was driven by a decrease in Performance

allocations, on which Performance allocations and incentive fee related compensation is based. This was partially offset by an

increase in Equity-based compensation for the three and six months ended June 30, 2026 relative to the comparable prior year

period of $23.1 million and $39.4 million, respectively, primarily driven by stock awards granted in December 2025 and

February 2026 to further align leadership with Company performance, as well as an increase in Cash-based compensation and

benefits of $23.5 million and $32.2 million, respectively, primarily due to an increase in headcount.

Interest and other expenses of Consolidated Funds. Interest and other expenses of Consolidated Funds decreased $7.5

million for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025. Interest and other

expenses of Consolidated Funds increased $45.4 million for the six months ended June 30, 2026, as compared to the six months

ended June 30, 2025, primarily due to higher interest expense related to the consolidated CLOs and a collateralized fund

obligation in the Carlyle AlpInvest segment that was consolidated in the third quarter of 2025.

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Other Income (Loss)

Net investment income (loss) of Consolidated Funds. The table below summarizes the components of Net investment

income (loss) of Consolidated Funds:

(Dollars in millions)

Net investment income (loss) of Consolidated Funds for the three and six months ended June 30, 2026 included net

change in unrealized loss on an investment in a consolidated infrastructure fund in our Global Private Equity segment of

approximately $47 million and $82 million, respectively. Through June 30, 2026, the cumulative unrealized investment loss

recognized with respect to this investment attributable to the Company was approximately $222 million, which will be realized

upon the disposition of the fund’s investment, which we currently expect will occur later in 2026. These unrealized losses were

partially offset by unrealized gains primarily attributable to consolidated funds in our Carlyle AlpInvest segment.

Substantially all net investment income (loss) of Consolidated Funds, together with interest and other income of

Consolidated Funds and interest and other expenses of Consolidated Funds, is attributable to the related funds’ limited partners

or CLO investors. Accordingly, such amounts have no material impact on net income attributable to the Company beyond the

Company’s capital invested in the Consolidated Funds.

Income Tax Expense

Provision for income taxes. Our provision for income taxes was $49.0 million and $112.5 million for the three months

ended June 30, 2026 and 2025, respectively, and $11.9 million and $124.9 million for the six months ended June 30, 2026 and

2025, respectively. Our effective tax rate was approximately 18% and 26% for the three months ended June 30, 2026 and 2025,

respectively, and 13% and 20% for the six months ended June 30, 2026 and 2025, respectively. The effective tax rate for the

three months ended June 30, 2026 and 2025 primarily comprised the 21% U.S. federal corporate income tax rate, the impact of

U.S. state and foreign income taxes, and disallowed executive compensation, offset by non-controlling interest. The effective

tax rate for the six months ended June 30, 2026 and 2025 primarily comprised the 21% U.S. federal corporate income tax rate

and the tax effects of equity-based compensation deductions, disallowed executive compensation, and non-controlling interest.

For the six months ended June 30, 2026, the effective tax rate also included the impact of a one-time tax expense related to a

change in the tax classification of a consolidated subsidiary.

Non-controlling Interests

Net income attributable to non-controlling interests in consolidated entities. Net income attributable to non-controlling

interests in consolidated entities was $87.7 million for the three months ended June 30, 2026, as compared to $8.4 million for

the three months ended June 30, 2025, and $78.0 million for the six months ended June 30, 2026, as compared to $37.0 million

for the six months ended June 30, 2025. The increase for the three and six months ended June 30, 2026 as compared to three

and six months ended June 30, 2025 was primarily due to net earnings of several Consolidated Funds in our Carlyle AlpInvest

segment, partially offset by a decline of $14.0 million during the three and six months ended June 30, 2026 in accrued carry

held by non-controlling interests. These amounts also reflect the related allocation of Consolidated Funds’ net earnings to

limited partners or CLO investors, net earnings from our insurance solutions business and certain other products allocated to

third-party investors, and net income attributable to non-controlling interests in carried interest and giveback obligations. The

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net income (loss) of our Consolidated Funds, after eliminations, attributable to non-controlling interests was $59.3 million and

$13.9 million for the three months ended June 30, 2026 and 2025, respectively, and $56.8 million and $21.9 million for the six

months ended June 30, 2026 and 2025, respectively.

Non-GAAP Financial Measures

The following tables set forth information in the format used by management when making resource deployment

decisions and in assessing performance of our segments. These Non-GAAP financial measures are presented for the three and

six months ended June 30, 2026 and 2025. Our Non-GAAP financial measures exclude the effects of unrealized performance

allocations net of related compensation expense, unrealized principal investment income, consolidated funds, acquisition and

disposition-related items including amortization and any impairment charges of acquired intangible assets and contingent

consideration taking the form of earn-outs, charges associated with the Conversion, impairment charges associated with lease

right-of-use assets, gains or losses from retirement of debt, charges associated with contract terminations and employee

severance, charges associated with equity-based compensation, changes in the tax receivable agreement liability, corporate

actions, infrequently occurring or unusual events, and non-recurring items that affect period-to-period comparability and are not

reflective of the Company’s operating performance.

The following table shows our total segment DE and FRE for the three and six months ended June 30, 2026 and 2025.

(Dollars in millions)

The following table sets forth our total segment revenues for the three and six months ended June 30, 2026 and 2025.

(Dollars in millions)

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The following table sets forth our total segment expenses for the three and six months ended June 30, 2026 and 2025.

(Dollars in millions)

Income (loss) before provision for income taxes is the U.S. GAAP financial measure most comparable to Distributable

Earnings and Fee Related Earnings. The following table is a reconciliation of income (loss) before provision for income taxes to

Distributable Earnings and to Fee Related Earnings.

(Dollars in millions)

(1) Equity-based compensation includes amounts presented in principal investment income and general, administrative and other expenses

in our U.S. GAAP statement of operations.

(2) Includes charges (credits) related to Carlyle corporate actions and non-recurring items that affect period-to-period comparability and are

not reflective of the Company’s operating performance.

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(3) See reconciliation to most directly comparable U.S. GAAP measure below:

(Dollars in millions)

(Dollars in millions)

(4) Adjustments to performance revenues and principal investment income (loss) relate to (i) unrealized performance allocations net of

related compensation expense and unrealized principal investment income, which are excluded from our Non-GAAP results, (ii)

amounts earned from the Consolidated Funds, which were eliminated in the U.S. GAAP consolidation but were included in the Non-

GAAP results, (iii) amounts attributable to non-controlling interests in consolidated entities, which were excluded from the Non-GAAP

results, (iv) the reclassification of NGP performance revenues, which are included in investment income in the U.S. GAAP financial

statements, (v) the reclassification of fee related performance revenues, which are included in fund level fee revenues in the segment

results, and (vi) the reclassification of tax expenses associated with certain foreign performance revenues. Adjustments to principal

investment income (loss) also include the reclassification of earnings for the investment in NGP Management and its affiliates to the

appropriate operating captions for the Non-GAAP results, and the exclusion of charges associated with the investment in NGP

Management and its affiliates that are excluded from the Non-GAAP results.

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Distributable Earnings for our reportable segments are as follows:

(Dollars in millions)

Segment Analysis

Discussed below is our DE and FRE for our segments for the periods presented. Our segment information is reflected in

the manner used by our chief operating decision maker to make operating and compensation decisions, assess performance, and

allocate resources.

For segment reporting purposes, revenues and expenses are presented on a basis that deconsolidates our Consolidated

Funds. As a result, segment revenues from management fees, realized performance revenues and realized principal investment

income (loss) are different than those presented on a consolidated U.S. GAAP basis because these revenues recognized in

certain segments are received from Consolidated Funds and are eliminated in consolidation when presented on a consolidated

U.S. GAAP basis. Furthermore, segment expenses are different than related amounts presented on a consolidated U.S. GAAP

basis due to the exclusion of fund expenses that are paid by the Consolidated Funds.

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Global Private Equity

The following table presents our results of operations for our Global Private Equity(1) segment:

(Dollars in millions)

(1) For purposes of presenting our results of operations for this segment, our earnings from our investments in NGP are presented in the

respective operating captions.

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Distributable Earnings

The following table provides the components of the changes in Distributable Earnings for the three and six months ended

June 30, 2026:

(Dollars in millions)

Realized net performance revenues. Realized net performance revenues increased $8.7 million for the three months ended

June 30, 2026, as compared to the three months ended June 30, 2025, and decreased $98.1 million for the six months ended

June 30, 2026, as compared to the six months ended June 30, 2025. Realized net performance revenues for the three and six

months ended June 30, 2026 were primarily attributable to realizations in CJP IV, which realized carry for the first time in the

second quarter of 2026, and to a lesser extent, CP VI. Realized net performance revenues for the three months ended June 30,

2025 were primarily attributable to realizations in NGP XI and, to a lesser extent, CAP IV and CP VI. Realized net performance

revenues for the six months ended June 30, 2025 were primarily attributable to realizations in CPP II, NGP XI, and CAP IV.

While overall exit activity increased for the six months ended June 30, 2026, as compared to the six months ended June 30,

2025, the mix of exits was more concentrated in funds not yet realizing performance revenues.

Realized principal investment income. Realized principal investment income decreased $6.8 million for three months

ended June 30, 2026, as compared to the three months ended June 30, 2025, primarily due to lower realized investment income

from our U.S. buyout funds. Realized principal investment income decreased $10.1 million for the six months ended June 30,

2026, as compared to the six months ended June 30, 2025, primarily due to lower realized principal investment income from

our U.S. and Europe buyout and infrastructure funds, partially offset by an increase from our Japan buyout funds. Global

Private Equity distributable earnings in the second half of 2026 may be lower than the first half of 2026 due to the expected

realization of a loss on an investment in an infrastructure fund. Through June 30, 2026, the cumulative unrealized loss with

respect to this investment is $222 million and will reduce realized principal investment income in Global Private Equity upon

disposition of the investment, which we currently expect will occur later in 2026.

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Fee Related Earnings

The following table provides the components of the changes in Fee Related Earnings for the three and six months ended

June 30, 2026:

(Dollars in millions)

Fee Revenues. The following table provides the components of the changes in Fee revenues for the periods presented:

(Dollars in millions)

Fund management fees decreased for the three months ended June 30, 2026 as compared to the three months ended June

30, 2025 driven by exit activity in funds on which management fees are based on invested capital and step-down in CP VII. The

decrease for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025 was driven by exit activity

in funds on which management fees are based on invested capital, a management fee step-down in CP VII, and lower catch-up

management fees, partially offset by the activation of management fees in CRP X in April 2025.

Portfolio advisory and transaction fees, net and other for the three and six months ended June 30, 2026 were primarily

driven by fees associated with multiple large transactions that closed during the second quarter of 2026. Portfolio advisory and

transaction fees, net and other for the six months ended June 30, 2025 reflected fees associated with the acquisition of a

healthcare investment across our U.S., Europe, and Asia buyout funds. Transaction fees are primarily generated by investment

activity within our funds, and are therefore impacted by our investment pace. See “—Trends Affecting Our Business” for

further discussion on our investment activity and broader market trends.

Cash-based compensation and benefits expense. Cash-based compensation and benefits expense decreased $9.5 million

for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, primarily due to a decrease in

bonus accruals, partially offset by the impact of increased headcount.

General, administrative and other indirect expenses. General, administrative and other indirect expenses increased $4.2

million for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, and increased $9.4

million for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, primarily due to higher IT-

related spending, higher conference costs, and unfavorable foreign currency remeasurement resulting from the strengthening of

the U.S. dollar in 2026.

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Fee-earning AUM

Fee-earning AUM is presented below for each period together with the components of change during each respective

period.

(Dollars in millions)

(1) For additional information concerning the components of Fee-earning AUM, see “—Key Financial Measures—Operating Metrics.”

(2) Represents annualized fund management fees divided by the average of the beginning of year and each quarter end’s Fee-earning AUM

in the reporting period. Catch-up management fees were excluded in the calculation of the annualized fund management fees.

The table below provides the period to period rollforward of Fee-earning AUM in our Global Private Equity segment.

(Dollars in millions)

(1) Inflows represents limited partner capital raised by our carry funds or separately managed accounts for which management fees based

on commitments were activated during the period, and the fee-earning commitments invested in vehicles for which management fees

are based on invested capital. Inflows exclude fundraising amounts during the period for which fees have not yet been activated, which

are referenced as Pending Fee-earning AUM.

(2) Outflows represents the impact of realizations from vehicles with management fees based on remaining invested capital at cost or fair

value, changes in basis for funds where the investment period, weighted-average investment period or commitment fee period has

expired during the period, and reductions for funds that are no longer calling for fees. Realizations for funds earning management fees

based on commitments during the period do not affect Fee-earning AUM.

(3) Market Activity & Other represents realized and unrealized gains (losses) on portfolio investments in our carry funds based on the

lower of cost or fair value.

(4) Foreign Exchange represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated

funds. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of the

period end.

Fee-earning AUM of $96.6 billion at June 30, 2026 decreased 3% from $99.1 billion at March 31, 2026. The net decrease

was due to:

• Outflows of $3.0 billion, driven by the expiration of fees in CEOF II during the period and realizations in funds that

charge fees on invested capital, notably in CP VII and CEP V.

Offsetting this decrease were:

• Inflows of $0.7 billion, primarily driven by investments in our evergreen funds which charge fees on net asset value,

as well as investment activity in our funds which charge fees on invested capital.

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Fee-earning AUM at June 30, 2026 decreased 5% from $101.4 billion at December 31, 2025, due to:

• Outflows of $6.3 billion, which were driven by realizations in funds that charge fees on invested capital, notably in

CP VII, CRP IX and CEP V, as well as the expiration of fees in CEOF II.

Offsetting this decrease were:

• Inflows of $1.9 billion, primarily driven by investments in our evergreen funds which charge fees on net asset value,

as well as investment activity in our funds which charge fees on invested capital.

Fee-earning AUM at June 30, 2026 decreased 6% from $102.3 billion at June 30, 2025, due to:

• Outflows of $9.0 billion driven by realizations in funds that charge fees on invested capital, notably in CP VII, CEP

V, CRP IX, and the NGP Energy funds, and the expiration of fees in CEOF II during the period.

Offsetting this decrease were:

• Inflows of $3.9 billion, primarily driven by investments in our evergreen funds, additional fee-paying capital raised

in our life sciences funds, as well as investment activity in our U.S. real estate funds which charge fees on invested

capital.

Total AUM

Total AUM was $162.7 billion at June 30, 2026, which comprised $120.7 billion of investments at fair value and $42.0

billion of available capital. Approximately 10% of the fair value as of June 30, 2026 was publicly traded, and approximately

66% was aged four or more years. The table below provides the period to period rollforward of Total AUM in our Global

Private Equity segment.

(Dollars in millions)

(1) Inflows reflects the impact of gross fundraising during the period. For funds or vehicles denominated in foreign currencies, this reflects

translation at the average quarterly rate.

(2) Outflows includes distributions net of recallable or recyclable amounts in our carry funds, related co-investment vehicles, and

separately managed accounts, gross redemptions in our evergreen products, and the expiration of available capital.

(3) Market Activity & Other generally represents realized and unrealized gains (losses) on portfolio investments in our carry funds, related

co-investment vehicles, and separately managed accounts, as well as the impact of fees, expenses and non-investment income, and

other changes in AUM.

(4) Foreign Exchange represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated

funds. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of the

period end.

Total AUM was $162.7 billion at June 30, 2026, an increase of 2% from $159.0 billion at March 31, 2026. The net

increase was due to:

• Inflows of $6.4 billion, driven by $5 billion of capital raised in an investment vehicle that is earmarked for our next

vintage U.S. buyout fund; and

• Market activity of $2.2 billion, driven by appreciation of $0.6 billion from the NGP Energy funds, $0.4 billion from

our international energy funds, and $0.4 billion from our Asia buyout funds, offset by depreciation of $0.2 billion

from our U.S. real estate funds and, $0.1 billion from our Europe buyout funds.

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Offsetting these increases were:

• Outflows of $4.6 billion driven by realizations in our U.S. buyout, Japan buyout and U.S. real estate funds.

Total AUM at June 30, 2026 decreased 1% from $163.5 billion at December 31, 2025, due to:

• Outflows of $11.2 billion, primarily driven by realizations in our U.S. buyout, U.S. real estate and Japan buyout

funds; and

• Negative foreign exchange activity of $0.7 billion reflected the impact of a strengthening U.S. Dollar on the

translation of our EUR- and JPY-denominated funds to USD.

Offsetting these decreases were:

• Inflows of $8.7 billion, driven by $5 billion of capital raised in an investment vehicle that is earmarked for our next

vintage U.S. buyout fund, as well as capital raised in U.S. buyout coinvestments and U.S. real estate products; and

• Market activity of $2.4 billion, driven by appreciation of $1.4 billion from the NGP Energy funds, $1.3 billion from

our international energy funds, and $0.6 billion from our Japan buyout funds, offset by depreciation of $0.6 billion

from our Europe buyout funds, $0.4 billion from our Asia buyout funds, and $0.4 billion from our U.S. buyout

funds.

Fund Performance Metrics

Fund performance information for our significant investment funds, which we generally define as those with at least $1.0

billion in capital commitments, is included throughout this discussion and analysis to facilitate an understanding of our results

of operations for the periods presented. The fund return information reflected in this discussion and analysis is not indicative of

the performance of The Carlyle Group Inc. and is also not necessarily indicative of the future performance of any particular

fund. An investment in The Carlyle Group Inc. is not an investment in any of our funds. There can be no assurance that any of

our funds or our other existing and future funds will achieve similar returns.

The following table reflects the performance of our significant funds in our Global Private Equity business. Please see

“—Our Global Investment Offerings” for a legend of the fund acronyms listed below.

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(Amounts in millions)

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*Net accrued fee related performance revenues for CPI are excluded from Net Accrued Performance Revenues. These amounts will be

reflected as fee related performance revenues when realized, and included in Fund level fee revenues in our segment results. Accrued fee

related performance revenues for CPI were immaterial as of June 30, 2026.

**The IRR is incalculable, which occurs in instances when a distribution occurs prior to a Limited Partner capital contribution due to the use

of fund-level credit facilities.

(1) The fund step-down date represents the contractual step-down date under the respective fund agreements for funds on

which the fee basis step-down has not yet occurred. Funds without a listed Fee Initiation Date and Step-down Date have

not yet initiated fees.

(2) All amounts shown represent total capital commitments as of June 30, 2026. Certain of our recent vintage funds are

currently in fundraising and total capital commitments are subject to change.

(3) Represents the original cost of investments since inception of the fund.

(4) Represents all realized proceeds since inception of the fund.

(5) Represents remaining fair value, before management fees, expenses and carried interest, and may include remaining

escrow values for realized investments.

(6) Multiple of invested capital (“MOIC”) represents total value, before management fees, expenses and carried interest,

divided by cumulative invested capital.

(7) Gross Internal Rate of Return (“Gross IRR”) represents an annualized return on Limited Partner invested capital, based

on contributions, distributions and unrealized fair value as of the reporting date, before the impact of management fees,

partnership expenses and carried interest. For fund vintages 2017 and after, Gross IRR includes the impact of interest

expense related to the funding of investments on fund lines of credit. Gross IRR is calculated based on the timing of

Limited Partner cash flows, which may differ to varying degrees from the timing of actual investment cash flows for the

fund. Subtotal Gross IRR aggregations for multiple funds are calculated based on actual cash flow dates for each fund

and represent a theoretical time-weighted return for a Limited Partner who invested sequentially in each fund.

(8) For funds marked “NM,” IRR may be positive or negative, but is not considered meaningful because of the limited time

since initial investment and early stage of capital deployment. For funds marked “Neg,” IRR is considered meaningful

but is negative as of reporting period end.

(9) Net Internal Rate of Return (“Net IRR”) represents an annualized return on Limited Partner invested capital, based on

contributions, distributions and unrealized fair value as of the reporting date, after the impact of all management fees,

partnership expenses and carried interest, including current accruals. Net IRR is calculated based on the timing of Limited

Partner cash flows, which may differ to varying degrees from the timing of actual investment cash flows for the fund.

Fund level IRRs are based on aggregate Limited Partner cash flows, and this blended return may differ from that of

individual Limited Partners. As a result, certain funds may generate accrued performance revenues with a blended Net

IRR that is below the preferred return hurdle for that fund. Subtotal Net IRR aggregations for multiple funds are

calculated based on actual cash flow dates for each fund and represent a theoretical time-weighted return for a Limited

Partner who invested sequentially in each fund.

(10) Represents the net accrued performance revenue balance/(giveback obligation) as of the current quarter end.

(11) Represents all realized proceeds combined with remaining fair value, before management fees, expenses and carried

interest.

(12) An investment is considered realized when the investment fund has completely exited, and ceases to own an interest in,

the investment. An investment is considered partially realized when the total amount of proceeds received in respect of

such investment, including dividends, interest or other distributions and/or return of capital, represents at least 85% of

invested capital and such investment is not yet fully realized. Because part of our value creation strategy involves

pursuing best exit alternatives, we believe information regarding Realized/Partially Realized MOIC and Gross IRR, when

considered together with the other investment performance metrics presented, provides investors with meaningful

information regarding our investment performance by removing the impact of investments where significant realization

activity has not yet occurred. Realized/Partially Realized MOIC and Gross IRR have limitations as measures of

investment performance and should not be considered in isolation. Such limitations include the fact that these measures

do not include the performance of earlier stage and other investments that do not satisfy the criteria provided above. The

exclusion of such investments will have a positive impact on Realized/Partially Realized MOIC and Gross IRR in

instances when the MOIC and Gross IRR in respect of such investments are less than the aggregate MOIC and Gross

IRR. Our measurements of Realized/Partially Realized MOIC and Gross IRR may not be comparable to those of other

companies that use similarly titled measures.

(13) Aggregate includes the following funds, as well as all active co-investments, separately managed accounts (SMAs), and

stand-alone investments arranged by us: MENA, CCI, CSSAF I, CPF I, CAP Growth I, CAP Growth II, CBPF II, CAGP

IV, ABV 8, ABV 9, ACCD 2, ACCD 3, and CCD-CIF.

(14) Aggregate includes the following funds, as well as related co-investments, separately managed accounts (SMAs), and

certain other stand-alone investments arranged by us: CP I, CP II, CP III, CP IV, CEP I, CEP II, CAP I, CAP II, CAP III,

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CBPF I, CJP I, CJP II, CMG, CVP I, CVP II, CUSGF III, CGFSP I, CEVP I, CETP I, CETP II, CAVP I, CAVP II,

CAGP III, CEOF I, Mexico, and CSABF.

(15) Funds are included when all investments have been realized. There may be remaining fair value and net accrued carry

where there are outstanding escrow balances or undistributed proceeds.

(16) For purposes of aggregation, funds that report in foreign currency have been converted to U.S. dollars at the reporting

period spot rate.

(17) Aggregate includes the following funds, as well as all active co-investments, separately managed accounts (SMAs), and

stand-alone investments arranged by us: CCR, CER I, and CER II.

(18) Aggregate includes the following funds, as well as related co-investments, separately managed accounts (SMAs), and

certain other stand-alone investments arranged by us: CRP I, CRP II, CRP III, CRP IV, CRP V, CRCP I, CAREP I,

CAREP II, CEREP I, CEREP II, and CEREP III.

(19) Aggregate includes the following funds, as well as all active co-investments, separately managed accounts (SMAs), and

stand-alone investments arranged by us: NGP GAP, NGP RP I, NGP RP II, NGP RP III, NGP ETP IV, NGP SRA II, and

CRSEF.

(20) Aggregate includes the following funds, as well as related co-investments, separately managed accounts (SMAs), and

certain other stand-alone investments arranged by us: CIP, CPP II, and CPOCP.

Global Credit

The following table presents our results of operations for our Global Credit segment:

(Dollars in millions)

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Distributable Earnings

The following table provides the components of the changes in Distributable Earnings for the three and six months ended

June 30, 2026:

(Dollars in millions)

Realized net performance revenues. Realized net performance revenues increased $18.7 million for the three months

ended June 30, 2026, as compared to the three months ended June 30, 2025, and increased $17.3 million for the six months

ended June 30, 2026, as compared to the six months ended June 30, 2025, primarily attributable to realizations in CCOF II.

Fee Related Earnings

The following table provides the components of the changes in Fee Related Earnings for the three and six months ended

June 30, 2026:

(Dollars in millions)

Fee Revenues. The following table provides the components of the changes in Fee revenues for the periods presented:

(Dollars in millions)

The decrease in Fund management fees for the three and six months ended June 30, 2026 as compared to the three and six

months ended June 30, 2025 was primarily attributable to $19 million of catch-up subordinated management fees in certain

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aviation funds in 2025, due in part to the collection of insurance proceeds and the sale of collateral in those vehicles, that did

not recur in 2026. This was partially offset by increases in management fees from CCOF III, CTAC, and direct lending

products for the three and six months ended June 30, 2026.

The increase in Portfolio advisory and transaction fees, net and other fees for the three and six months ended June 30,

2026 as compared to the three and six months ended June 30, 2025 was primarily driven by an increase in capital markets fees.

Capital markets fees in the three months ended June 30, 2026 were elevated in part due to approximately $49 million related to

an investment vehicle that raised $5 billion of capital which is earmarked for our next vintage U.S. buyout fund. The

recognition of capital markets fees can be volatile as they are primarily generated by investment activity. See “—Trends

Affecting Our Business” for further discussion on our investment activity and broader market trends.

The increase in Fee related performance revenues for the three and six months ended June 30, 2026 as compared to the

three and six months ended June 30, 2025 was primarily due to the restructuring of certain fee arrangements in our asset-backed

finance products, the impact of which included approximately $19 million of catch-up fees.

Cash-based compensation and benefits expense. Cash-based compensation and benefits expense increased $23.7 million

for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, and increased $28.0 million

for the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, primarily due to increased

headcount to support the growth of the business as well as an increase in fee related compensation.

Fee-earning AUM

Fee-earning AUM is presented below for each period together with the components of change during each respective

period.

(Dollars in millions)

(1) For additional information concerning the components of Fee-earning AUM, see “—Key Financial Measures—Operating Metrics.”

(2) Includes the fair value of Fortitude’s general account assets covered by the strategic advisory services agreement and funds with fees

based on gross asset value.

(3) Represents annualized fund management fees divided by the average of the beginning of year and each quarter end’s Fee-earning AUM

in the reporting period. Catch-up management fees were excluded in the calculation of the annualized fund management fees.

The table below provides the period to period rollforward of Global Credit Fee-earning AUM.

(Dollars in millions)

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(1) Inflows represents limited partner capital raised by our carry funds or separately managed accounts for which management fees based

on commitments were activated during the period, the fee-earning commitments invested in vehicles for which management fees are

based on invested capital, incremental fee-earning collateral from new CLO issuances and resets, reinsurance and other transactions at

Fortitude, and gross subscriptions in our vehicles for which management fees are based on net asset value.

(2) Outflows represents the impact of realizations from vehicles with management fees based on remaining invested capital at cost or fair

value, changes in basis for funds where the investment period, weighted-average investment period or commitment fee period has

expired during the period, reductions for funds that are no longer calling for fees, gross redemptions in our evergreen products, and

outflows from our liquid credit products. Realizations for funds earning management fees based on commitments during the period do

not affect Fee-earning AUM.

(3) Market Activity & Other represents realized and unrealized gains (losses) on portfolio investments in funds or vehicles based on the

lower of cost or fair value or net asset value, activity of funds with fees based on gross asset value, and changes in the fair value of

Fortitude’s general account assets covered by the strategic advisory services agreement.

(4) Foreign Exchange represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated

funds. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of the

period end.

Fee-earning AUM was $167.6 billion at June 30, 2026, an increase of 1% from $166.4 billion at March 31, 2026. The net

increase was due to:

• Inflows of $4.6 billion, which were driven by deployment across the platform, including two new-issue CLOs in our

U.S. liquid credit platform, deployment in our opportunistic credit and asset-backed finance funds, and closed block

and flow reinsurance transactions in our insurance strategy.

Offsetting these increases were:

• Outflows of $2.6 billion, driven by outflows from our liquid credit and direct lending products, as well as

realizations across the platform; and

• Negative market activity of $0.7 billion, which primarily reflected a decrease in the fair value of assets covered by

the Fortitude strategic advisory services agreement.

Fee-earning AUM at June 30, 2026 decreased 1% from $169.5 billion at December 31, 2025, due to:

• Outflows of $7.2 billion, which were driven by outflows from our liquid credit products and realizations in our

opportunistic credit funds; and

• Negative market activity of $2.3 billion, which primarily reflected a decrease in the fair value of assets covered by

the Fortitude strategic advisory services agreement.

Offsetting these decreases were:

• Inflows of $7.9 billion, which were driven by deployment across the platform, closed block and flow reinsurance

transactions in our insurance strategy, and the closing of two U.S. CLOs and one European CLO.

Fee-earning AUM at June 30, 2026 increased 3% from $162.8 billion at June 30, 2025, due to:

• Inflows of $22.4 billion, which reflected capital deployment across the platform, including the closing of seven U.S.

CLOs and three European CLOs, deployment across our asset-backed finance, opportunistic credit, and direct

lending funds, and closed block and flow reinsurance transactions in our insurance strategy.

Offsetting this increase were:

• Outflows of $14.5 billion, which included outflows from our liquid credit products and realizations across the

platform; and

• Negative market activity of $2.8 billion, which was primarily driven by a decrease in the fair value of assets covered

by the Fortitude strategic advisory services agreement, partially offset by increases in our cross-platform credit

products.

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Total AUM

The table below provides the period to period rollforward of Total AUM in our Global Credit segment.

(Dollars in millions)

(1) Inflows generally reflects the impact of gross fundraising, as well as reinsurance and other transactions at Fortitude during the period.

For funds or vehicles denominated in foreign currencies, this reflects translation at the average quarterly rate.

(2) Outflows includes distributions net of recallable or recyclable amounts in our carry funds, related co-investment vehicles, and

separately managed accounts, gross redemptions in our evergreen products, outflows from our liquid credit products, and the expiration

of available capital.

(3) Market Activity & Other generally represents realized and unrealized gains (losses) on portfolio investments in our carry funds, related

co-investment vehicles, and separately managed accounts, as well as the impact of fees, expenses and non-investment income, change

in gross asset value for our business development companies, changes in the fair value of Fortitude’s general account assets covered by

the strategic advisory services agreement, and other changes in AUM.

(4) Foreign Exchange represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated

funds. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of the

period end.

Total AUM was $211.1 billion at June 30, 2026, an increase of 1% compared to $209.5 billion at March 31, 2026. The

net increase was due to:

• Inflows of $5.8 billion, which were driven by the closing of three U.S. CLOs, capital raised in our asset-backed

finance, infrastructure credit, and opportunistic credit products, and closed block and flow reinsurance transactions

in our insurance strategy; and

• Positive market activity of $0.9 billion, primarily from an increase in the fair value of our direct lending,

opportunistic credit, and aviation products, partially offset by a decrease in the fair value of assets covered by the

Fortitude strategic advisory services agreement.

Offsetting these increases were:

• Outflows of $5.0 billion, which primarily reflected outflows from our liquid credit products and realizations across

the platform, notably in our direct lending, aviation, asset-backed finance, and opportunistic credit products.

Total AUM at June 30, 2026 slightly decreased from $211.3 billion at December 31, 2025, due to:

• Outflows of $9.7 billion, including outflows in our liquid credit products and realizations across the platform,

notably in our aviation, direct lending, and asset-backed finance products.

Offsetting this decrease were:

• Inflows of $9.7 billion, which were driven by capital raised in our asset-backed finance strategy, including the first

closing in our asset-backed income fund, the closing of three U.S. CLOs and one European CLO, and closed block

and flow reinsurance transactions in our insurance strategy.

Fund Performance Metrics

Fund performance information for certain of our Global Credit funds is included throughout this discussion and analysis

to facilitate an understanding of our results of operations for the periods presented. The fund return information reflected in this

discussion and analysis is not indicative of the performance of The Carlyle Group Inc. and is also not necessarily indicative of

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the future performance of any particular fund. An investment in The Carlyle Group Inc. is not an investment in any of our

funds. There can be no assurance that any of our funds or our other existing and future funds will achieve similar returns.

The following table reflects the performance of our significant carry funds in our Global Credit business. Please see “—

Our Global Investment Offerings” for a legend of the fund acronyms listed below.

(Dollars in millions)

(1) The fund step-down date represents the contractual step-down date under the respective fund agreements for funds on

which the fee basis step-down has not yet occurred. Funds without a listed Fee Initiation Date and Step-down Date have

not yet initiated fees.

(2) All amounts shown represent total capital commitments as of June 30, 2026. Certain of our recent vintage funds are

currently in fundraising and total capital commitments are subject to change. Committed capital for CCOF II excludes

$150 million in capital committed by a CCOF II investor to a side vehicle. The CCOF III platform, which includes

CCOF III - Levered, CCOF III - Unlevered, and CCOF III PSV, collectively has $5.7 billion of committed capital.

(3) Represents the original cost of investments since the inception of the fund. For CSP III and CSP IV, reflects amounts

net of investment level recallable proceeds which is adjusted to reflect recyclability of invested capital for the purpose

of calculating the fund MOIC.

(4) Represents all realized proceeds since inception of the fund.

(5) Represents remaining fair value, before management fees, expenses and carried interest, and may include remaining

escrow values for realized investments.

(6) Multiple of invested capital (“MOIC”) represents total value, before management fees, expenses and carried interest,

divided by cumulative invested capital.

(7) Gross Internal Rate of Return (“Gross IRR”) represents an annualized return on Limited Partner invested capital, based

on contributions, distributions and unrealized fair value as of the reporting date, before the impact of management fees,

partnership expenses and carried interest. For fund vintages 2017 and after, Gross IRR includes the impact of interest

expense related to the funding of investments on fund lines of credit. Gross IRR is calculated based on the timing of

Limited Partner cash flows, which may differ to varying degrees from the timing of actual investment cash flows for the

fund. Subtotal Gross IRR aggregations for multiple funds are calculated based on actual cash flow dates for each fund

and represent a theoretical time-weighted return for a Limited Partner who invested sequentially in each fund.

(8) For funds marked “NM,” IRR may be positive or negative, but is not considered meaningful because of the limited time

since initial investment and early stage of capital deployment. For funds marked “Neg,” IRR is considered meaningful

but is negative as of reporting period end.

(9) Net Internal Rate of Return (“Net IRR”) represents an annualized return on Limited Partner invested capital, based on

contributions, distributions and unrealized fair value as of the reporting date, after the impact of all management fees,

partnership expenses and carried interest, including current accruals. Net IRR is calculated based on the timing of

Limited Partner cash flows, which may differ to varying degrees from the timing of actual investment cash flows for the

fund. Fund level IRRs are based on aggregate Limited Partner cash flows, and this blended return may differ from that

of individual Limited Partners. As a result, certain funds may generate accrued performance revenues with a blended

Net IRR that is below the preferred return hurdle for that fund. Subtotal Net IRR aggregations for multiple funds are

calculated based on actual cash flow dates for each fund and represent a theoretical time-weighted return for a Limited

Partner who invested sequentially in each fund.

(10) Represents the net accrued performance revenue balance/(giveback obligation) as of the current quarter end.

(11) Aggregate includes the following funds, as well as all active co-investments, separately managed accounts (SMAs), and

stand-alone investments arranged by us: SASOF IV, SASOF V, CAPF VII, CICF, CAF, CALF, CCOF III - Unlevered,

and CCOF III PSV.

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(12) Aggregate includes the following funds, as well as related co-investments, separately managed accounts (SMAs), and

certain other stand-alone investments arranged by us: CSP I, CSP II, CSP III, CEMOF I, CEMOF II, CSC, CMP I,

CMP II, SASOF II, and CASCOF.

(13) Funds are included when all investments have been realized. There may be remaining fair value and net accrued carry

where there are outstanding escrow balances or undistributed proceeds.

Carlyle AlpInvest

The following table presents our results of operations for our Carlyle AlpInvest segment:

(Dollars in millions)

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Distributable Earnings

The following table provides the components of the changes in Distributable Earnings for the three and six months ended

June 30, 2026:

(Dollars in millions)

Fee Related Earnings

The following table provides the components of the changes in Fee Related Earnings for the three and six months ended

June 30, 2026:

(Dollars in millions)

Fee Revenues. Fee revenues increased $32.9 million for the three months ended June 30, 2026, as compared to the three

months ended June 30, 2025, and increased $43.5 million for the six months ended June 30, 2026, as compared to the six

months ended June 30, 2025, primarily driven by an increase in Fee related performance revenues of $22.0 million and $22.5

million, respectively, reflecting growth and performance in our CAPM and CAPS funds, which drove a corresponding increase

in cash-based compensation and benefits. Fund management fees also increased by $10.9 million and $20.9 million for the

three and six months ended June 30, 2026, respectively, as compared to three and six months ended June 30, 2025, primarily

driven by the impact of fundraising in AAF II, ASPF II, and ASF VIII, as well as continued growth in our CAPM and CAPS

funds. These increases were partially offset by decreases in catch-up management fees of $11.0 million and $22.9 million,

respectively, primarily due to the conclusion of fundraising for our most recent vintage secondaries & portfolio finance funds in

the third quarter of 2025. Catch-up management fees totaled $11.5 million and $10.6 million for the three and six months ended

June 30, 2026, respectively.

General, administrative and other indirect expenses. General, administrative and other indirect expenses increased $5.3

million for the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, and increased $13.6

million for the six months ended June 30, 2026 as compared to the six months ended June 30, 2025, primarily due to an

increase in professional fees and fundraising costs.

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Fee-earning AUM

Fee-earning AUM is presented below for each period together with the components of change during each respective

period.

(Dollars in millions)

(1) For additional information concerning the components of Fee-earning AUM, see “—Key Financial Measures—Operating Metrics.”

(2) Includes amounts committed to or reserved for certain AlpInvest funds.

(3) Represents annualized fund management fees divided by the average of the beginning of year and each quarter end’s Fee-earning AUM

in the reporting period. Catch-up management fees were excluded in the calculation of the annualized fund management fees.

The table below provides the period to period rollforward of Fee-earning AUM in our Carlyle AlpInvest segment.

(Dollars in millions)

(1) Inflows represents limited partner capital raised by our carry funds or separately managed accounts for which management fees based

on commitments were activated during the period, fee-earning commitments invested in vehicles for which management fees are based

on invested capital, and gross subscriptions in our vehicles for which management fees are based on net asset value. Inflows exclude

fundraising amounts during the period for which fees have not yet been activated, which are referenced as Pending Fee-earning AUM.

(2) Outflows represents the impact of realizations from vehicles with management fees based on remaining invested capital at cost or fair

value, changes in basis for funds where the investment period, weighted-average investment period, or commitment fee period has

expired during the period, and reductions for funds that are no longer calling for fees. Distributions for funds earning management fees

based on commitments during the period do not affect Fee-earning AUM.

(3) Market Activity & Other represents realized and unrealized gains (losses) on portfolio investments in our carry funds based on the

lower of cost or fair value and net asset value.

(4) Foreign Exchange represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated

funds. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of the

period end.

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Fee-earning AUM was $70.2 billion at June 30, 2026, an increase of 3% from $67.9 billion at March 31, 2026. The net

increase was due to:

• Inflows of $3.1 billion, which were driven by fee-paying capital raised and investment activity across all strategies,

notably in our secondaries & portfolio finance and CAPM funds.

Offsetting this increase were:

• Outflows of $0.7 billion, which were driven by realizations in funds that charge fees on invested capital, mostly in

our primary and secondaries & portfolio finance funds.

Fee-earning AUM at June 30, 2026 increased 6% from $66.0 billion at December 31, 2025, due to:

• Inflows of $6.4 billion, which were driven by investment activity and fee-paying capital raised in our secondaries &

portfolio finance strategy, as well as investment activity in our Carlyle AlpInvest wealth products.

Offsetting this increase were:

• Outflows of $1.7 billion, which were driven by step-downs in fee bases, as well as realizations in products across all

strategies that charge fees on invested capital.

Fee-earning AUM at June 30, 2026 increased 18% compared to $59.6 billion at June 30, 2025, due to:

• Inflows of $15.5 billion, which were driven by fee-paying capital raised and investment activity across all strategies,

notably in our secondaries & portfolio finance and Carlyle AlpInvest wealth products; and

• Market appreciation of $0.8 billion, which was driven by our Carlyle AlpInvest wealth products in which fees are

based on net assert value.

Offsetting these increases were:

• Outflows of $5.1 billion, which reflected realizations across all strategies and step-downs in fee bases in our primary

funds.

Total AUM

The table below provides the period to period rollforward of Total AUM in our Carlyle AlpInvest segment.

(Dollars in millions)

(1) Inflows reflects the impact of gross fundraising during the period. For funds or vehicles denominated in foreign currencies, this reflects

translation at the average quarterly rate.

(2) Outflows includes distributions in our carry funds, related co-investment vehicles and separately managed accounts, as well as the

expiration of available capital.

(3) Market Activity & Other generally represents realized and unrealized gains (losses) on portfolio investments in our carry funds, related

co-investment vehicles and separately managed accounts, the net impact of fees, expenses and non-investment income, as well as other

changes in AUM.

(4) Foreign Exchange represents the impact of foreign exchange rate fluctuations on the translation of our non-U.S. dollar denominated

funds. Activity during the period is translated at the average rate for the period. Ending balances are translated at the spot rate as of the

period end.

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Total AUM was $111.7 billion at June 30, 2026, an increase of 4% compared to $106.9 billion at March 31, 2026. The

net increase was due to:

• Inflows of $4.5 billion, which reflected fundraising across the segment, notably in our secondaries & portfolio

finance and CAPM funds; and

• Market appreciation of $2.4 billion, which was driven by our secondaries & portfolio finance and primary funds.

Offsetting these increases were:

• Outflows of $1.8 billion, predominantly from realizations in our secondaries & portfolio finance and primary

strategies.

Total AUM at June 30, 2026 increased 9% compared to $102.0 billion at December 31, 2025, due to:

• Inflows of $11.4 billion, which reflected fundraising across the platform, notably in cross-strategy SMAs and our

AlpInvest wealth products; and

• Market appreciation of $3.1 billion, which was driven by our secondaries & portfolio finance and primary strategies,

as well as our Carlyle AlpInvest wealth products.

Offsetting these increases were:

• Outflows of $4.0 billion, which reflected realizations across all strategies; and
• Negative foreign exchange activity of $0.8 billion primarily reflected the impact of a strengthening U.S. Dollar on

the translation of our EUR-denominated funds to USD.

Fund Performance Metrics

The fund return information reflected in this discussion and analysis is not indicative of the performance of The Carlyle

Group Inc. and is also not necessarily indicative of the future performance of any particular fund. An investment in The Carlyle

Group Inc. is not an investment in any of our funds. There can be no assurance that any of our funds or our other existing and

future funds will achieve similar returns.

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The following table reflects the performance of our significant funds in our Carlyle AlpInvest business. We also present

fund performance information for portfolios of investments held by separately managed accounts, generally aggregated either

as invested alongside the relevant commingled fund or over a specified time period.

(Amounts in millions)

(Reported in Local Currency, in Millions)

(1) Includes private equity and mezzanine primary fund investments, secondary fund investments and co-investments

originated by AlpInvest. Excluded from the performance information shown are: (a) investments that were not originated

by AlpInvest (i.e., AlpInvest did not make the original investment decision or recommendation); (b) Direct Investments,

which was spun off from AlpInvest in 2005; (c) Carlyle AlpInvest Private Markets (“CAPM”); (d) Carlyle AlpInvest

Private Markets Secondaries (“CAPS”); and (e) LP co-investment vehicles managed by AlpInvest. As of June 30, 2026,

these excluded portfolios amounted to approximately $19.9 billion of AUM in the aggregate.

(2) Represents the original cost of investments since inception of the fund.

(3) To exclude the impact of FX, all foreign currency cash flows have been converted to the currency representing a majority

of the capital committed to the relevant fund at the reporting period spot rate.

(4) Represents all realized proceeds combined with remaining fair value, before management fees, expenses and carried

interest.

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(5) Multiple of invested capital (“MOIC”) represents total value, before management fees, expenses and carried interest,

divided by cumulative invested capital.

(6) Gross Internal Rate of Return (“Gross IRR”) represents the annualized IRR for the period indicated on Limited Partner

invested capital based on investment contributions, distributions and unrealized value of the underlying investments, before

management fees, expenses and carried interest at the AlpInvest level.

(7) Net Internal Rate of Return (“Net IRR”) represents the annualized IRR for the period indicated on Limited Partner invested

capital based on investment contributions, distributions and unrealized value of the underlying investments, after

management fees, expenses and carried interest. Fund level IRRs are based on aggregate Limited Partner cash flows, and

this blended return may differ from that of individual Limited Partners. As a result, certain funds may generate accrued

performance revenues with a blended Net IRR that is below the preferred return hurdle for that fund.

(8) “ASF” stands for AlpInvest Secondaries Fund, “ACF” stands for AlpInvest Co-Investment Fund, “ASPF” stands for

AlpInvest Strategic Portfolio Finance, “AAF” stands for AlpInvest Atom Fund, and “SMAs” are Separately Managed

Accounts. “ASF - SMAs” and “ACF - SMAs” reflect the aggregated portfolios of investments held by SMAs within the

relevant strategy, which invest alongside the relevant ASF or ACF (as applicable). Strategic SMAs reflect the aggregated

portfolios of co-investments made by SMAs sourced from the SMA investor’s own private equity fund investment

portfolio. Other SMAs reflect the aggregated portfolios of investments within the relevant strategy that began making

investments in the corresponding time periods. Co-Investments SMAs 2014-2016 does not include two SMAs that started

in 2016 but invested a substantial majority alongside ACF VII. These two SMAs have instead been grouped with ACF VII

- SMAs. ACF IX SMAs and Primary Investments SMAs 2024-2026 do not include one SMA that started in 2026 but will

invest a substantial majority alongside ACF X and Primary Investments 2027-2029. This SMA will remain grouped with

All Other Active Funds & Vehicles until the activation of ACF X and Primary Investments 2027-2029. An SMA may

pursue multiple investment strategies and make commitments over multiple years.

(9) Includes ASF VIII - SMAs, AlpInvest Atom Fund, all mezzanine investment portfolios, all ‘clean technology’ private

equity investment portfolios, all strategic portfolio finance SMAs, all AlpInvest senior portfolio lending SMAs, and any

state-focused investment mandate portfolios.

(10) For funds marked “NM,” IRR may be positive or negative, but is not considered meaningful because of the limited time

since initial investment and early stage of capital deployment. For funds marked “Neg,” IRR is considered meaningful but

is negative as of reporting period end.

(11) For purposes of aggregation, funds that report in foreign currency have been converted to U.S. dollars at the reporting

period spot rate.

(12) Represents the net accrued performance revenue balance/(giveback obligation) as of the current quarter end. Total Net

Accrued Carry excludes net accrued carry which was retained as part of the sale of MRE on April 1, 2021. There was no

net accrued carry balance for MRE as of June 30, 2026.

Liquidity and Capital Resources

Historical Liquidity and Capital Resources

We have historically required limited capital resources to support the working capital and operating needs of our

business. Our management fees have largely covered our operating costs and all realized performance allocations, after

covering the related compensation, are available for distribution to stockholders. Approximately 97% of all capital

commitments to our funds are provided by our fund investors, with the remaining amount typically funded by Carlyle, our

senior Carlyle professionals, advisors, and other professionals. We may elect to invest additional amounts in new investment

areas or other growth opportunities through increased investment in our funds, which we may subsequently transfer to newly

developed products.

Our Sources of Liquidity

We have multiple sources of liquidity to meet our capital needs, as outlined below. Although we may consider other

financings to invest in growing our business, such as the $800.0 million senior note offering in 2025, we believe these sources

will be sufficient to fund our capital needs for at least the next twelve months. We believe we will meet longer-term expected

future cash requirements and obligations through a combination of existing cash and cash equivalent balances, cash flow from

operations, accumulated earnings, and amounts available for borrowing from our senior revolving credit facility or other

financings.

Cash, Cash Equivalents, and Corporate Treasury Investments. Cash and cash equivalents, as well as corporate treasury

investments (if any), were approximately $1.3 billion at June 30, 2026. However, a portion of this cash is allocated for specific

business purposes, including, but not limited to: (i) performance allocations and incentive fee related cash that has been

received but not yet distributed as performance allocations and incentive fee related compensation (ii) amounts owed to non-

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controlling interests, and (iii) regulatory capital. After deducting cash amounts allocated to the specific requirements mentioned

above, the remaining cash, cash equivalents, and corporate treasury investments, was approximately $0.6 billion as of June 30,

Borrowings. Our credit facilities, notes offerings, and CLO borrowings are additional sources of liquidity, as discussed in

Note 5, Borrowings, to the condensed consolidated financial statements. The amended and restated revolving credit facility has

a borrowing capacity of $1.0 billion as of June 30, 2026, and is scheduled to mature on May 29, 2030. Additionally, certain

subsidiaries of the Company are parties to a revolving line of credit, primarily intended to support certain lending activities

within the Global Credit segment, which provides for a revolving line of credit with a capacity of $300 million, that matures in

September 2027, and a second revolving line of credit with a capacity of $200 million, that matures on August 19, 2026, but

which we expect to extend. There are no amounts outstanding on the credit facilities as of June 30, 2026.

The following table summarizes our debt obligations as of June 30, 2026. The maturity profile of these debt obligations,

including our credit facilities, and our other contractual obligations is presented under “Contractual Obligations” below.

(Dollars in millions)

(1) Carrying value reflects unamortized original issue discount or premium and deferred financing costs.

(2) CLO borrowings carried a weighted-average interest rate of 4.87% and weighted-average remaining maturity of 10.5 years as of

June 30, 2026. See Note 5, Borrowings, for fair values and additional terms.

Realized Performance Allocation Revenues. Another source of liquidity we may use to meet our capital needs is the

realized performance allocation revenues generated by our investment funds. Performance allocations are generally realized

when an underlying investment is profitably disposed of and the fund’s cumulative returns are in excess of the preferred return.

For certain funds, performance allocations are realized once all invested capital and expenses have been returned to the fund’s

investors and the fund’s cumulative returns are in excess of the preferred return.

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Our accrued performance allocations by segment as of June 30, 2026, gross and net of accrued giveback obligations, are

set forth below:

(Dollars in millions)

(1) Accrued incentive fees are excluded from net accrued performance revenues.

(2) Accrued performance allocations from NGP funds are presented as principal equity method investments in the condensed

consolidated balance sheets.

The net accrued performance revenues attributable to The Carlyle Group Inc., excluding realized amounts, related to our

carry funds and our other vehicles as of June 30, 2026, as well as the carry fund appreciation (depreciation), is set forth below

by segment (Dollars in millions):

(1) Appreciation/(Depreciation) represents unrealized gain/(loss) for the period on a total return basis before fees and expenses. The

percentage of return is calculated as: ending remaining investment fair market value plus net investment outflow (sales proceeds

minus net purchases) minus beginning remaining investment fair market value divided by beginning remaining investment fair

market value. Amounts are fund only, and do not include coinvestments.

Realized Principal Investment Income. Another source of liquidity we may use to meet our capital needs is the realized

principal investment income generated by our equity method investments and other principal investments. Certain of the

investments attributable to The Carlyle Group Inc. (excluding certain general partner interests, certain strategic investments,

and investments in certain CLOs) may be sold at our discretion as a source of liquidity.

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Investments as of June 30, 2026 consist of the following:

(Dollars in millions)

(1) Represents our total investment in NGP. See Note 4, Investments, to our condensed consolidated financial statements.

Our investments as of June 30, 2026 can be further attributed as follows (Dollars in millions):

(1) Excludes our strategic equity method investment in NGP Management and investments in NGP general partners - accrued

performance allocations. This balance also includes amounts bridged by us on behalf of investment funds for which we have

entered into warehouse agreements. Under such warehouse agreements, we may elect to transfer investments for a price that differs

from fair value.

(2) Includes the Company’s indirect investment in Fortitude through Carlyle FRL, a Carlyle-affiliated investment fund, as discussed in

Note 4, Investments, to the condensed consolidated financial statements. This investment had a carrying value of $732.7 million as

of June 30, 2026.

Our Liquidity Needs

We generally use our working capital and cash flows to invest in growth initiatives, service our debt, fund the working

capital needs of our business and investment funds, and return capital to our common stockholders in the form of dividends or

stock repurchases.

In the future, we expect that our primary liquidity needs will be to:

• provide capital to facilitate the growth of our existing business lines;
• provide capital to facilitate our expansion into new, complementary business lines, including acquisitions;
• pay operating expenses, including compensation and compliance costs and other obligations as they arise;
• fund costs of litigation and contingencies, including related legal costs;
• fund the capital investments in our funds;
• fund capital expenditures;
• repay borrowings and related interest costs and expenses;
• pay earn-outs and contingent cash consideration associated with our acquisitions and strategic investments;
• pay income taxes, including corporate income taxes;

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• pay dividends to our common stockholders in accordance with our dividend policy;
• repurchase our common stock and pay any associated taxes; and
• settle tax withholding obligations in connection with net share settlements of equity-based awards.

Common Stockholder Dividends. Under our dividend policy for our common stock, our intention is to pay dividends to

holders of our common stock in an amount of $0.35 per common share on a quarterly basis ($1.40 annually). For U.S. federal

income tax purposes, any dividends we pay generally will be treated as qualified dividend income (generally taxable to U.S.

individual stockholders at capital gain rates) paid by a domestic corporation to the extent paid out of our current or accumulated

earnings and profits, as determined for U.S. federal income tax purposes, with any excess dividends treated as return of capital

to the extent of the stockholder’s basis. The declaration and payment of dividends to holders of our common stock will be at the

sole discretion of our Board of Directors and in compliance with applicable law, and our dividend policy may be changed at any

time.

To date, with respect to dividend year 2026, the Board of Directors has declared a dividend to common stockholders

totaling $250.4 million, or $0.70 per share, including the second quarter 2026 dividend declared in July 2026. With respect to

the full dividend year 2025, the Board of Directors declared cumulative dividends to common stockholders totaling $505.1

million, or $1.40 per share. For further information, see Note 12, Equity, to the condensed consolidated financial statements

included in this Quarterly Report on Form 10-Q.

Fund Commitments. Generally, up to 3% of all capital commitments to our investment funds are made by Carlyle, our

senior Carlyle professionals, advisors, and other professionals. Carlyle will generally commit up to 1% of capital commitments

related to our carry funds, although we may elect to invest additional amounts in funds focused on new investment areas or

other growth opportunities. We may, from time to time, exercise our right to purchase additional interests in our investment

funds that become available in the ordinary course of their operations. We expect our senior Carlyle professionals and

employees to continue to make significant capital contributions to our funds based on their existing commitments, and to make

capital commitments to future funds consistent with the level of their historical commitments. We also intend to make

investments in our evergreen funds and our CLO vehicles. Our investments in our European CLO vehicles will comply with the

risk retention rules as discussed in “Risk Retention Rules” later in this section.

A substantial majority of the remaining commitments to our investment funds are expected to be funded by senior Carlyle

professionals, operating executives, and other professionals through our internal co-investment program. Of the $4.3 billion of

unfunded commitments as of June 30, 2026, approximately $3.4 billion is subscribed individually by senior Carlyle

professionals, operating executives, and other professionals, with the balance funded directly by the Company. Approximately

76% of the $4.3 billion of unfunded commitments relate to investment funds in our Global Private Equity segment.

Under the Carlyle Global Capital Markets platform, certain of our subsidiaries may act as an underwriter, syndicator or

placement agent for security offerings and loan originations. We earn fees in connection with these activities and bear the risk

of the sale of such securities and placement of such loans, which may be longer dated. As of June 30, 2026, there were no

material commitments related to the origination and syndication of loans and securities under the Carlyle Global Capital

Markets platform.

Repurchase Program. During the six months ended June 30, 2026, we paid an aggregate of $365.0 million to repurchase

and retire approximately 7.9 million shares of common stock. In addition, during the six months ended June 30, 2026, we paid

an aggregate of $143.9 million and retired 2.6 million shares of common stock to settle tax withholding obligations in

connection with net share settlements of equity-based awards, for a total of $508.9 million for approximately 10.5 million

shares repurchased or withheld this year. As of June 30, 2026, $1.6 billion of repurchase capacity remained under the share

repurchase program, which reflects the cost of common shares repurchased as well as tax withholding payments made by the

Company related to the net share settlement of equity-based awards. For further information on our repurchase program, see

Note 12, Equity, to the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.

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Cash Flows

The following tables summarize our condensed consolidated statements of cash flows by activities attributable to the

Company and the Consolidated Funds.

(Dollars in millions)

The condensed consolidated statements of cash flows include the cash flows of our Consolidated Funds, which include

certain consolidated investment funds and the CLOs. Generally, the consolidation of the Consolidated Funds has a gross-up

effect on our assets, liabilities and cash flows activities. The primary cash flow activities of the Consolidated Funds generally

include (i) purchases of investments, (ii) proceeds from sales of investments, and (iii) net borrowings of the Consolidated

Funds. Contributions from and distributions to the non-controlling interest holders on the condensed consolidated statements of

cash flows primarily relate to non-controlling interest holders in the Consolidated Funds. The impact that the Consolidated

Funds had on cash flows attributable to the Company for the periods presented were limited to our interest in these funds, which

is included in the discussion below. Thus we excluded the Consolidated Funds from the discussion below.

Net cash used in operating activities. Net cash used in operating activities primarily consists of: (i) net cash generated

from operating activities, which include the receipt of management fees, realized performance allocations and incentive fees

after payments for compensation and general, administrative and other expenses, and (ii) our net investment activity, which

include purchases of and proceeds from our investment activities.

For the six months ended June 30, 2026 and 2025, we received management fees and realized performance allocations,

principal investment income, and incentive fees of $1.8 billion and $1.9 billion, respectively, partially offset by payments for

compensation, interest, and general, administrative and other expenses of $1.4 billion and $1.6 billion, respectively, which

included payment of 2025 and 2024 year-end bonuses paid in January 2026 and 2025, respectively.

For the six months ended June 30, 2026 and 2025, net cash provided by (used in) our investment activities were $(132.5)

million and $17.7 million, respectively, which primarily represented cash used to fund commitments and investments in our

portfolio offset by proceeds related to distributions of our investments. As of June 30, 2026 and June 30, 2025, our investments

totaled $3.4 billion and $3.0 billion, respectively. We expect our commitments to and investments in our funds will continue to

increase with the growth of our assets under management and our investments in new products.

Net cash used in investing activities. For the six months ended June 30, 2026 and 2025, cash used in investing activities

primarily reflected capital expenditures related to information technology, leasehold improvements, and other fixed assets of

$60.1 million and $34.2 million, respectively.

Net cash provided by financing activities. For the six months ended June 30, 2026 and 2025, we paid dividends to our

common stockholders of $252.1 million and $252.7 million, respectively. For the six months ended June 30, 2026 and 2025, we

paid $508.9 million and $280.1 million, respectively, to repurchase and retire 10.5 million and 5.6 million shares, respectively,

which included shares retired in connection with the net share settlement of equity-based awards.

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Our Balance Sheet

Total assets were $28.2 billion at June 30, 2026, a decrease of $0.9 billion compared to December 31, 2025. The decrease

in total assets was primarily attributable to a decrease in Investments, including Performance allocations of $0.9 billion and a

decrease in Cash and cash equivalents of $0.7 billion, partially offset by an increase in Investments of Consolidated Funds of

$0.8 billion. The decrease in Investments, including Performance allocations was primarily driven by declines in CP VII’s

accrued performance allocations, largely attributable to declines in market prices of certain public investments and the impact

of preferred return, partially offset by appreciation in our international energy funds, CJP IV, and secondaries & portfolio

finance funds. Refer to “—Cash Flows” in Part I, Item 2 of this Quarterly Report on Form 10-Q for details on the decrease in

Cash and cash equivalents.

Total liabilities were $21.0 billion at June 30, 2026, a decrease of $1.1 billion from December 31, 2025. The decrease in

liabilities was primarily attributable to a decrease in Accrued compensation and benefits of $0.8 billion and a decrease in Other

liabilities of Consolidated Funds of $0.6 billion, partially offset by an increase in Loans payable of Consolidated Funds of $0.4

billion. The decrease in Accrued compensation and benefits was primarily attributable to a decrease in Accrued performance

allocations, on which Accrued performance allocations and incentive fee related compensation is based, as well as the payment

of previously realized performance allocations and incentive fee related compensation and year-end bonuses.

The assets and liabilities of the Consolidated Funds are generally held within separate legal entities and, as a result, the

assets of the Consolidated Funds are not available to meet our liquidity requirements and similarly the liabilities of the

Consolidated Funds are non-recourse to us. The number of funds that we consolidate fluctuates period to period. In general, the

number of funds we are required to consolidate has been increasing as a result of our investment in new products and our

indirect interest in funds through our indirect investment in Fortitude.

Our balance sheet without the effect of the Consolidated Funds can be seen in Note 16, Supplemental Financial

Information, to the condensed consolidated financial statements included in this Quarterly Report on Form 10-Q. At June 30,

2026, our total assets without the effect of the Consolidated Funds were $15.2 billion, including cash and cash equivalents of

$1.3 billion and Investments, including accrued performance allocations, of $11.4 billion.

Unconsolidated Entities

Certain of our funds have entered into lines of credit secured by their investors’ unpaid capital commitments or by a

pledge of the equity of the underlying investment. These lines of credit are used primarily to reduce the overall number of

capital calls to investors or for working capital needs. In certain instances, however, they may be used for other investment

related activities, including serving as bridge financing for investments. The degree of leverage employed varies among our

funds.

Off-balance Sheet Arrangements

In the normal course of business, we enter into various off-balance sheet arrangements including sponsoring and owning

limited or general partner interests in consolidated and non-consolidated funds, entering into derivative transactions, and

entering into guarantee arrangements. We also have ongoing capital commitment arrangements with certain of our consolidated

and non-consolidated funds.

For further information regarding our off-balance sheet arrangements, see Note 2, Summary of Significant Accounting

Policies, and Note 7, Commitments and Contingencies, to the condensed consolidated financial statements included in this

Quarterly Report on Form 10-Q. Other than what we have disclosed in this Quarterly Report on Form 10-Q, we do not have any

other off-balance sheet arrangements that would require us to fund losses or guarantee target returns to investors in any of our

other investment funds.

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Contractual Obligations

The following table sets forth information relating to our contractual obligations as of June 30, 2026 on a consolidated

basis and on a basis excluding the obligations of the Consolidated Funds:

(Dollars in millions)

(1) The table above assumes that no prepayments are made on the senior and subordinated notes and that the outstanding balances, if any, on the senior

credit facility and Global Credit Revolving Credit Facility are repaid on the maturity dates of credit facilities. The CLO term loans are included in the

table above based on the earlier of the stated maturity date or the date the CLO is expected to be dissolved. See Note 5, Borrowings, to the condensed

consolidated financial statements for the various maturity dates of our borrowings.

(2) Interest payments assume that no prepayments are made and loans are held until maturity with the exception of the CLO term loans, which are based

on the earlier of the stated maturity date or the date the CLO is expected to be dissolved.

(3) These obligations represent our estimate of amounts to be paid on the contingent cash obligations associated with our acquisition of Abingworth. The

payment obligations are unsecured obligations of the Company or a subsidiary thereof, subordinated in right of payment to indebtedness of the

Company and its subsidiaries, and do not bear interest.

(4) We lease office space in various countries around the world, including our largest offices in Washington, D.C., New York City, London, Amsterdam,

and Hong Kong, which have non-cancelable lease agreements expiring in various years through 2037. The amounts in this table represent the minimum

lease payments required over the term of the lease.

(5) These obligations generally represent commitments by us to fund a portion of the purchase price paid for each investment made by our funds. These

amounts are generally due on demand and are therefore presented in the less than one year category. A substantial majority of these investments is

expected to be funded by senior Carlyle professionals and other professionals through our internal co-investment program. Of the $4.3 billion of

unfunded commitments to the funds, approximately $3.4 billion is subscribed individually by senior Carlyle professionals, advisors and other

professionals, with the balance funded directly by the Company. Additionally, these obligations include accrued giveback that has been realized but not

yet paid to the respective funds, a portion of which is payable by current and former senior Carlyle professionals.

(6) In connection with our initial public offering, we entered into a tax receivable agreement with the limited partners of the Carlyle Holdings partnerships

whereby we agreed to pay such limited partners 85% of the amount of cash tax savings, if any, in U.S. federal, state and local income tax realized as a

result of increases in tax basis resulting from exchanges of Carlyle Holdings partnership units for common units of The Carlyle Group L.P. From and

after the consummation of the Conversion, former holders of Carlyle Holdings partnership units do not have any rights to payments under the tax

receivable agreement except for payment obligations pre-existing at the time of the Conversion with respect to exchanges that occurred prior to the

Conversion. These obligations are more than offset by the future cash tax savings that we are expected to realize.

(7) These obligations represent amounts due to holders of debt securities issued by the consolidated CLO vehicles. These obligations include interest to be

paid on debt securities issued by the consolidated CLO vehicles. Interest payments assume that no prepayments are made and loans are held until

maturity. For debt securities with rights only to the residual value of the CLO and no stated interest, no interest payments were included in this

calculation. Interest payments on variable-rate debt securities are based on interest rates in effect as of June 30, 2026, at spreads to market rates

pursuant to the debt agreements, and range from 1.65% to 11.09%.

(8) These obligations represent commitments of the CLOs to fund certain investments. These amounts are generally due on demand and are therefore

presented in the less than one year category.

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Contingent Cash Payments For Business Acquisitions and Strategic Investments

We have certain contingent cash obligations associated with our acquisition of Abingworth, which are accounted for as

compensation expense, and are accrued over the service period. If earned, payments are made in the quarter following the

performance year to which the payments relate. The contingent cash obligations relate to future incentive payments of up to

$130.0 million that are payable upon the achievement of certain performance targets during 2025 through 2028, which is the

maximum amount that could be paid as of June 30, 2026. Through June 30, 2026, we paid $4.3 million related to these

contingent obligations and have accrued $16.1 million as of June 30, 2026.

Risk Retention Rules

We will continue to comply with the risk retention rules governing CLOs issued in Europe for which we are a sponsor,

which require a combination of capital from our balance sheet, commitments from senior Carlyle professionals and/or third-

party financing.

Guarantees

See Note 7, Commitments and Contingencies, to the condensed consolidated financial statements included in this

Quarterly Report on Form 10-Q for information related to all of our material guarantees.

Indemnifications

In many of our service contracts, we agree to indemnify the third-party service provider under certain circumstances. The

terms of the indemnities vary from contract to contract, and the amount of indemnification liability, if any, cannot be

determined and has not been included in the table above or recorded in our condensed consolidated financial statements as of

June 30, 2026. See Note 7, Commitments and Contingencies, to the condensed consolidated financial statements included in

this Quarterly Report on Form 10-Q for information related to indemnifications.

Contingent Obligations (Giveback)

Carried interest is ultimately realized when: (1) an underlying investment is profitably disposed of, (2) certain costs borne

by the limited partner investors have been reimbursed, (3) the fund’s cumulative returns are in excess of the preferred return,

and (4) we have decided to collect carry rather than return additional capital to limited partner investors. Realized carried

interest may be required to be returned by us in future periods if the fund’s investment values decline below certain levels.

When the fair value of a fund’s investments remains constant or falls below certain return hurdles, previously recognized

performance allocations are reversed. See Note 7, Commitments and Contingencies, to the condensed consolidated financial

statements included in this Quarterly Report on Form 10-Q for additional information related to our contingent obligations

(giveback).

Other Contingencies

In the ordinary course of business, we are a party to litigation, investigations, inquiries, employment-related matters,

disputes and other potential claims. We discuss certain of these matters in Note 7, Commitments and Contingencies, to the

condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.

Carlyle Common Stock

A rollforward of our common stock outstanding is as follows:

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Shares of The Carlyle Group Inc. common stock issued during the six months ended June 30, 2026 relate to the vesting of

the Company’s restricted stock units. Shares of The Carlyle Group Inc. common stock repurchased during the six months ended

June 30, 2026 relate to shares repurchased and subsequently retired as part of our share repurchase program. Shares of The

Carlyle Group Inc. common stock issued and repurchased/retired during the six months ended June 30, 2026 exclude shares

retired as part of the net share settlement of equity-based awards.

The total shares as of June 30, 2026 as shown above exclude approximately 3.0 million net common shares, representing

the vesting of restricted stock units subsequent to June 30, 2026 that will participate in the common shareholder dividend that

will be paid on August 26, 2026.

Critical Accounting Policies and Estimates

The preparation of our condensed consolidated financial statements in conformity with U.S. GAAP requires our

management to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses,

and related disclosures of contingent assets and liabilities. These estimates and judgments are based on historical information,

information currently available to us and various other assumptions management believes to be reasonable under the

circumstances. Actual results could vary from those estimates and we may change our estimates and assumptions in future

evaluations. Changes in these estimates and assumptions may have a material effect on our results of operations and financial

condition.

There have been no material changes in the critical accounting estimates since those discussed in our Annual Report on

Form 10-K for the year ended December 31, 2025.

Our primary exposure to market risk is related to our role as general partner or investment advisor to our investment

funds and the sensitivities to movements in the fair value of their investments, including the effect on management fees,

incentive fees and investment income, including performance allocations. Although our investment funds share many common

themes, each of our asset management asset classes runs its own investment and risk management processes, subject to our

overall risk tolerance and philosophy. The investment process of our investment funds involves a comprehensive due diligence

approach, including review of reputation of shareholders and management, company size and sensitivity of cash flow

generation, business sector and competitive risks, portfolio fit, exit risks and other key factors highlighted by the deal team. Key

investment decisions are generally subject to approval by both the fund-level managing directors, as well as the investment

committee, which generally comprises one or more of the three founding partners as well as senior investment professionals.

Once an investment in a portfolio company has been made, our fund teams closely monitor the performance of the portfolio

company, generally through frequent contact with management and the receipt of financial and management reports.

There was no material change in our market risks during the six months ended June 30, 2026. For additional information,

refer to our Annual Report on Form 10-K for the year ended December 31, 2025.

Evaluation of Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the

Securities Exchange Act of 1934, as amended (the “Exchange Act”)) that are designed to ensure that information required to be

disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the time periods

specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management,

including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding

required disclosures. In designing disclosure controls and procedures, our management necessarily was required to apply its

judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. The design of any

disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events, and

there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Any

controls and procedures, no matter how well designed and operated, can provide only reasonable, not absolute, assurance of

achieving the desired control objectives.

Our management, with the participation of our principal executive officer and principal financial officer, has evaluated

the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by

this report. Based upon that evaluation and subject to the foregoing, our principal executive officer and principal financial

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officer concluded that, as of the end of the period covered by this report, the design and operation of our disclosure controls and

procedures were effective to accomplish their objectives at the reasonable assurance level.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f)

under the Exchange Act) during the fiscal quarter ended June 30, 2026 that have materially affected, or that are reasonably

likely to materially affect, our internal control over financial reporting.

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For a discussion of our potential risks and uncertainties, see the information under Item 1A. “Risk Factors” in our Annual

Report on Form 10-K for the year ended December 31, 2025.