BLK BlackRock, Inc. 10-Q 2026-09-30 section summaries

BlackRock — nine months ended September 30, 2026

BlackRock reported strong revenue and earnings growth in Q3 and year to date, with Q3 growth below the nine-month pace. The company reports one operating segment, asset management; management evaluates performance using consolidated revenue, operating income and net income attributable to BlackRock.

Consolidated results

Revenue increased 19.1% in Q3 and 25.1% for 9M; operating income rose 19.1% and 41.2%, respectively. Investment advisory, administration and securities-lending revenue grew 19.6% in Q3 and 23.7% for 9M.

Long-term investment advisory revenue was $5.682 billion versus $4.728 billion in Q3 and $16.163 billion versus $12.986 billion for 9M. Q3 retail advisory revenue was $1.396 billion versus $1.177 billion; ETF revenue was $2.762 billion versus $2.130 billion; and institutional active revenue was $1.231 billion versus $1.149 billion. For 9M, the respective figures were $3.982 billion versus $3.291 billion, $7.763 billion versus $5.798 billion, and $3.581 billion versus $3.146 billion. Institutional subtotal revenue was $1.524 billion versus $1.421 billion in Q3 and $4.418 billion versus $3.897 billion for 9M.

Cash flow and balance sheet

The prior-year investing outflow included $3.496 billion of acquisitions, compared with $15 million net of cash acquired in 9M 2026. Cash, cash equivalents and restricted cash at period-end were $12.899 billion versus $10.001 billion.

Finite-lived intangible amortization was $829 million for 9M. Goodwill declined partly due to a $94 million HPS purchase-price-allocation adjustment for deferred tax liabilities. Separate-account assets and liabilities were each $65.056 billion, and securities-lending collateral assets and corresponding liabilities were each $5.465 billion; these matched fund-related balances materially affect the consolidated balance sheet.

Acquisitions, valuation and financing

BlackRock acquired HPS Investment Partners on July 1, 2025, for $12.221 billion of total consideration net of cash acquired. The acquisition included $8.452 billion of Subco Units at closing, $3.4 billion of deferred contingent consideration and $244 million of cash acquired. The purchase-price allocation included $6.747 billion of goodwill, $3.0 billion of indefinite-lived management contracts and $2.660 billion of finite-lived management contracts. HPS supports BlackRock’s strategy to integrate public- and private-credit capabilities. The goodwill is not tax-deductible.

On July 1, 2026, expiration of a contractual cash-settlement provision led to reclassification of 2.8 million HPS Subco Units, valued at $2.6 billion, from liabilities to permanent noncontrolling interest. Remaining HPS consideration depends on performance milestones. The reported fair value of contingent consideration liabilities was $5.858 billion at September 30, 2026, versus $8.429 billion at year-end; the decrease includes the HPS reclassification and is not solely a cash settlement or valuation gain. Including HPS units and acquisition-related RSUs, potential aggregate issuance could reach approximately 13.8 million common shares if maximum contingent consideration is achieved and awards convert or settle.

BlackRock acquired Preqin in March 2025 for £2.5 billion (approximately $3.2 billion) in cash; net consideration after acquired cash was $3.123 billion. The allocation included $2.377 billion of goodwill and $1.050 billion of customer relationships. Preqin adds private-markets data and analytics to the Aladdin platform.

At September 30, 2026, investments totaled $15.384 billion versus $13.271 billion at year-end. Recurring fair-value assets were $86.276 billion versus $81.565 billion, including $3.513 billion of Level 3 investments versus $2.858 billion. Level 3 valuations rely on significant unobservable inputs and may be sensitive to discount rates and risk premiums. NAV-valued investments were $3.513 billion with $2.216 billion of unfunded commitments; private-market holdings may be illiquid and dependent on underlying-asset realizations.

Long-term borrowings had a $12.740 billion carrying value and $11.735 billion estimated fair value, compared with $12.768 billion and $12.546 billion at year-end. The $6.3 billion revolving credit facility was undrawn and matures in March 2031; BlackRock can request another $1.4 billion, subject to lender approval. Its net-debt-to-EBITDA ratio was below 1.0x against a 3.5x limit. The $5 billion commercial-paper program was also undrawn. Regulated subsidiaries were required to maintain approximately $2.2 billion of net capital, and BlackRock reported compliance.

Other investor considerations

BlackRock repurchased 1.3 million shares and share equivalents for approximately $1.4 billion in 9M; approximately 7.9 million shares remained authorized at September 30. Outstanding RSUs included 3,112,634 time-based awards and 633,933 performance-based awards, with intrinsic values of $3.3 billion and $671 million, respectively, at a $1,058 share price. Unrecognized compensation expense was $1.3 billion for unvested RSUs and $319 million for performance awards.

Related-party receivables, primarily from managed investment products, were $444 million versus $377 million at year-end. BlackRock had $2.6 billion of commitments to fund sponsored investment products, generally callable on demand. It faced an antitrust suit brought by 13 state Attorneys General; management did not expect legal or regulatory matters to materially affect results, financial position or cash flows, while noting that outcomes remain uncertain.

The company reported AOCI of negative $680 million versus negative $558 million a year earlier. Its nine-month foreign-currency translation adjustment was a loss of approximately $135 million, compared with a $620 million gain in 2025. Q3 geographic revenue included Americas of $4.940 billion versus $4.181 billion and Europe of $2.469 billion versus $2.065 billion.

BlackRock — Q3 and first nine months of 2026

Results

BlackRock’s growth reflected higher average assets, organic base-fee growth, stronger performance fees and technology subscriptions. Market appreciation helped nine-month results, while acquisitions—notably HPS, GIP and Preqin—added fees and AUM but also increased expenses and acquisition-related costs. Q3’s GAAP operating margin was unchanged year over year; the nine-month margin expanded.

Q3 performance fees benefited primarily from liquid alternatives, including one hedge fund with a Q3 annual measurement period; private-markets performance fees were lower. Nine-month performance fees also reflected HPS and higher long-only fees. Technology revenue grew with demand for Aladdin and multi-product solutions, with Preqin contributing in the nine-month period.

Higher average AUM increased distribution and direct fund costs; acquisitions also added expenses. Q3 included $564M of contingent-consideration fair-value expense, $471M more than a year earlier, primarily related to HPS and GIP and affected by BlackRock’s share price. For 9M, the fair-value change was $239M lower year over year, while acquired-intangible amortization increased to $829M from $507M.

Adjusted margin revenue excludes distribution fees and specified advisory fees passed through to intermediaries. Following the HPS transaction, adjusted net income and EPS treat outstanding Subco Units issued as consideration as exchanged one-for-one into BlackRock shares.

AUM, flows and business drivers

AUM reached $15.488T at September 30, 2026, up from $13.464T a year earlier. Q3 AUM increased by $143.6B: $205.5B of net inflows and $4.3B of positive FX were partly offset by $60.1B of market depreciation. In 9M, AUM growth reflected $526.9B of net inflows and $1.007T of market appreciation, partly offset by $63.9B of negative FX. Trailing-12-month net inflows were $868.6B.

Q3 long-term inflows were $174.8B, including $134.5B into ETFs; cash management added $30.7B. Fixed income and equity led product inflows, while institutional index outflows were concentrated in low-fee index equity. In 9M, long-term inflows totaled $509.8B, including $444.1B into ETFs, and cash-management inflows were $17.0B. Index bond ETFs and core equity ETFs were major sources of ETF demand. Private markets attracted $39.8B in 9M, led by private credit ($17.6B) and infrastructure ($14.1B); realizations were $20.0B. The company remains exposed to markets and currency movements, and performance fees can be volatile and concentrated.

Balance sheet, liquidity and capital

GAAP assets included $70.521B of separate-account assets and collateral and $5.168B attributable to consolidated sponsored investment products (CIPs). The adjusted balance sheet, excluding these items, showed $102.209B of assets, $38.541B of liabilities and $63.668B of equity. CIP cash is not readily available for operating use; approximately $5.9B of deferred tax liabilities related to goodwill and intangibles.

Nine-month GAAP operating cash flow was $2.953B; the supplemental presentation excluding CIPs reported $6.915B. Ex-CIP investing cash outflow was $1.2B, including $316M of property-and-equipment purchases. Ex-CIP financing outflow was $4.6B, mainly $2.8B of dividends and Subco distributions and $1.8B of share and share-equivalent repurchases. Liquidity resources comprised $12.090B of cash excluding CIPs and $6.300B of undrawn credit capacity. BlackRock repurchased 1.3M shares and share equivalents for approximately $1.4B in 9M; about 7.9M shares remained authorized.

BlackRock had $12.836B of principal in long-term notes outstanding and paid approximately $446M of interest on those notes in 9M. Scheduled future principal and interest payments totaled $18.746B. Its $6.3B revolving facility, extended to March 2031, was undrawn; net-debt-to-EBITDA was below 1.0x against a 3.5x covenant limit. Required regulatory capital was $2.2B, and the company reported compliance with applicable requirements. Regulated-subsidiary requirements and restrictions on moving cash across borders may limit cash mobility.

Other exposures and investor considerations

Remaining contingent consideration had a $5.9B fair value, including $4.8B for GIP and $900M for HPS, and is subject to Level 3 valuation estimates that can create earnings volatility. After a HPS cash-settlement provision expired in July, 2.8M Subco Units valued at approximately $2.6B were reclassified from liabilities to nonredeemable noncontrolling interest. The company also had $2.6B of unfunded commitments to sponsored investment products and $3.5B of deferred carried interest; commitments may be called on uncertain timing, and carried interest is subject to performance conditions and possible clawback.

Diluted weighted-average shares were 164.5M in Q3 versus 165.2M, and 164.7M in 9M versus 159.4M. At September 30, 154.6M common shares and 7.6M Subco Units were outstanding, 162.2M combined, versus 163.2M a year earlier. Results also include noncash investment-valuation changes; Q3 gains included $80M from Securitize, while tax rates were 29.4% for Q3 and 24.0% for 9M. BlackRock identifies market and flow sensitivity, acquisition integration, technology and cybersecurity, regulatory developments, and third-party and geopolitical risks as important challenges.

Item 3 — Quantitative and Qualitative Disclosures About Market Risk

BlackRock’s advisory and administration fees are primarily based on average or period-end assets under management (AUM). Declines in equity prices, changes in interest rates or credit spreads, and foreign-exchange movements can reduce AUM and fee revenue; some fees also depend on investment performance.

At September 30, 2026, BlackRock held approximately $10.4 billion of investments in consolidated sponsored investment products accounted for as VIEs or voting-rights entities. Excluding Federal Reserve Bank stock, carried interest, investments hedging certain deferred cash compensation plans, and certain investments hedged through the seed-capital program, its economic exposure to the investment portfolio was $4.9 billion.

Investment exposures and hypothetical sensitivities

These sensitivities are hypothetical estimates of changes in carrying value. The equity, debt and foreign-currency exposures may overlap and should not be added together.

Seed investments and hedging

Futures outstanding under the seed-capital hedging program had an aggregate notional value of approximately $2.0 billion at September 30, 2026, compared with $1.7 billion at December 31, 2025. The related investments support co-investments, track records, deferred-compensation hedging or regulatory purposes, and include exposure to real assets, private equity and hedge funds.

Outstanding foreign-currency forward contracts had an aggregate notional value of approximately $3.0 billion, primarily with maturities in Q4 2026. Exchange-traded futures hedging market movements in certain deferred cash compensation plans had an aggregate notional value of approximately $332 million and also expired in Q4 2026.

As of September 30, 2026, BlackRock’s CEO and CFO concluded that the company’s disclosure controls and procedures were effective. No changes during the quarter materially affected, or were reasonably likely to materially affect, internal control over financial reporting. This section addresses controls and procedures; it reports no financial results or business developments.

BlackRock cautions that the risk factors described in its Form 10-K for the year ended December 31, 2025, together with other information in the report, could materially affect its business, financial condition, results of operations, and nonoperating results. This section excerpt does not detail or quantify particular risks; it directs readers to the 2025 Form 10-K for the full discussion.

Under Section 13(r) of the Exchange Act, added by the Iran Threat Reduction and Syria Human Rights Act of 2012, BlackRock incorporates Exhibit 99.1 by reference. The exhibit contains information provided to BlackRock by Malaysia Airports Holdings Berhad. This section provides no financial metrics or further details about the reported activity.