Financial Results
Falling Markets Take BlackRock's AuM Under $8 Trillion Mark
Shares in the world's largest asset manager have fallen this year. Figures yesterday showed earnings and revenue fell in the third quarter of 2022.
Shares in the world's largest asset manager have fallen this year. Figures yesterday showed that earnings and revenue fell in the third quarter of 2022.
BlackRock’s standing as the world’s largest asset manager remains but the ravages of a falling stock market have wiped 16 per cent off the US-listed firm’s AuM since the end of September last year, figures showed.
In its results for the three months to end-September 2022, the listed firm said that total assets under management stood at $7.961 trillion, down from $9.463 trillion a year ago.
Total net flows also fell sharply to $16.9 billion in Q3 2022, down from $75.3 billion a year earlier, the firm said in a statement. However, among long-term assets, BlackRock logged $65 billion of quarterly long-term net inflows, as a result of continued momentum in strategic exchange traded funds and “significant outsourcing mandates.” The total net inflow figure takes account of clients pulling out cash, and changes to advisory AuM.
The organization is one of the first US financial businesses to start reporting its Q3 figures and, as expected, the impact of falling equity markets is taking its toll on results.
Adjusted operating income fell 21 per cent year-on-year in the quarter to $1.526 billion, and on a 15 per cent drop in revenues, to $4.3 billion. The operating margin narrowed to 35.4 per cent from 38.3 per cent.
BlackRock’s chief executive, Larry Fink, applauded the long-term net inflow figures, and said the firm’s diverse range of investment offerings made it a resilient business. In recent years, Fink has been one of the most prominent investment sector voices urging companies to adopt ESG principles, sometimes prompting claims that he is trying to make the firm “woke.” (Fink has rejected such criticism).
The share price performance of BlackRock tends to be highly geared to the status of financial markets more widely. Shares in BlackRock, which have plunged 42 per cent this year, weakened yesterday. Investors remain spooked by prospects of higher US Federal Reserve interest rates to curb inflation.
