BlackRock Reports Q3 Revenue Growth of 19% to $7.8 Billion

BlackRock (NYSE: BLK ) released third-quarter financial results and hosted an earnings call on Wednesday. Read the complete transcript below. This content is powered APIs. For comprehensive financial data and transcripts, visit The full earnings call is available at Summary BlackRock Inc.

reported a 38% year-over-year increase in earnings per share for Q3 2026, with operating margins reaching 47.8%. The company achieved $205 billion in net inflows during the quarter, with 11% organic base fee growth, marking its ninth consecutive quarter with 5% or more growth. Revenue grew by 19% to $7.8 billion, driven by organic base fee growth, higher markets, and increased performance and technology services fees. The firm's strategic initiatives include expanding in AI infrastructure and digital transformation, leading to significant inflows across ETFs, private markets, and systematic strategies.

Management highlighted the importance of leveraging public and private market blends and technology to maintain durable growth, with significant client engagement and a strong global presence. BlackRock's future outlook remains positive, with expectations of continuing momentum in Q4, driven by seasonal strength in iShares and private markets fundraising. Full Transcript Jen, Operator Good morning. My name is Jen and I will be your conference facilitator today.

At this time I'd like to welcome everyone to the BlackRock Incorporated third quarter 2026 earnings teleconference. Our hosts for today's call will be Chairman and Chief Executive Officer Lawrence D. Fink, Chief Financial Officer Martin S. Small, President Rob Kapito, and General Counsel Christopher J.

Meade. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer period. If you'd like to ask a question during this time, simply press star, then the number one on your telephone keypad.

If you'd like to withdraw your question, please press star two. Thank you, Mr. Meade. You may begin your conference.

Chris Meade, General Counsel & Chief Legal Officer Good morning everyone. I'm Chris Meade, the General Counsel of BlackRock. Before we begin, I'd like to remind you that during the course of this call, we may make a number of forward-looking statements. We call your attention to the fact that BlackRock's actual results may, of course, differ from these statements.

As you know, BlackRock has filed reports with the SEC which list some of the factors that may cause the results of BlackRock to differ materially from what we say today. BlackRock assumes no duty and does not undertake to update any forward-looking statements. So with that, I'll turn it over to Martin. Martin Small, Chief Financial Officer Thanks, Chris, and good morning everyone.

It's my pleasure to present results for the third quarter of 2026. Before I turn it over to Larry, I'll review our financial performance and business results. Our earnings release discloses both GAAP and as-adjusted financial results. A reconciliation between GAAP and our as-adjusted results has been included in the tables attached to today's press release.

I'll be focusing primarily on our as-adjusted results. A year ago, our clients were focused on managing uncertainty around inflation, rates, and growth. Today they're focused on capturing the opportunities created by technology and artificial intelligence. They're focused on infrastructure investment and a renaissance for income investing.

They're aiming to secure returns fueled from a new wave of productivity and innovation. There's more money in motion across global capital markets, and there's expanding opportunities for BlackRock and our clients. They're powered by earnings-driven returns, higher yields, and broader opportunities to diversify and manage risk through our whole-portfolio approach. The breadth of our platform is deepening our relationships with clients across all channels, retail and institutional, and all over the world.

Capital is flowing into the infrastructure required to power AI and digital transformation. Wealth portfolios are broadening beyond traditional allocations into personalized solutions delivered at scale, and retirement is being reshaped by growing demand for income and broader investment access. When clients need advice on capital markets, portfolio construction, or a partner to deploy capital at scale across public and private markets, they're coming to BlackRock. We've methodically invested through cycles to build a scaled platform, one that can connect clients across public and private markets with technology.

It's paying off now in our results and in the accelerating pipeline ahead. Clients entrusted us with nearly $870 billion of net inflows over the last 12 months, driving 10% organic base fee growth. That's not one product or one region carrying the firm. It's broad-based across client channels, asset classes, and geographies.

As we set out in our 2030 plan at last year's Investor Day, we're driving growth in higher-value, higher base-fee-rate categories, and our business mix across public, private, and technology is creating more durable and all-weather growth in revenue and earnings. Shareholders are benefiting from that growth. In our first comparable quarter since the HPS close, year-on-year EPS growth accelerated to over 35%. High momentum across our business is translating into stronger financial outcomes.

We again delivered double-digit growth in revenue, operating income, and earnings per share, with all three measures reaching new records. Our scaled and disciplined financial rubric are helping translate growth into the bottom line. Our operating margin reached 47.8%, up 320 basis points year over year. In the third quarter BlackRock generated $205 billion of net inflows.

Organic base fee growth of 11% marks our ninth consecutive quarter at or above 5%. Our growth continues to broaden across active ETFs, private markets, systematic SMAs, digital assets, and technology. These capabilities are scaling simultaneously, demonstrating the power of BlackRock's platform breadth and the durability of our growth model. Third quarter revenue of $7.8 billion was 19% higher year over year, driven by organic base fee growth, the impact of higher markets on average AUM, higher performance fees, and higher technology services and subscription revenue.

Operating income of $3.3 billion was up 27% year over year. Earnings per share of $15.93 increased 38% versus a year ago, also reflecting higher non-operating income and a lower diluted share count in the current quarter. Non-operating results for the quarter included $164 million of net investment gains, primarily due to mark-to-market non-cash gains linked to our minority investments in Securitize and Circle. Our as-adjusted tax rate for the third quarter was approximately 24%.

We continue to estimate that 25% is a reasonable projected tax run rate for the fourth quarter of 2026. The actual effective tax rate may differ because of non-recurring or discrete items or potential changes in tax legislation. Third quarter base fee and securities lending revenue of $6 billion increased 20% year over year, reflecting the positive impact of market beta on average AUM, organic base fee growth, and higher securities lending revenue. On an equivalent day count basis, our annualized effective fee rate was approximately flat compared to the second quarter.

Sustained client demand for high-value categories, including private markets, active ETFs, and systematic, continues to support fee rates on net inflows that are well above the firm's blended effective fee rate. Performance fees of $630 million increased 22% from a year ago, primarily reflecting higher revenue from alternatives, including $110 million of performance fees from HPS. Quarterly technology services and subscription revenue was up 14% compared to a year ago, reflecting sustained demand for our full range of technology offerings. Annual contract value, or ACV, increased 12% year over year.

On a constant-currency basis, we estimate ACV would have increased 13% from a year ago. We remain committed to low- to mid-teens ACV growth over the long term. Total expense increased 14% year over year, primarily driven by higher compensation, sales, asset and account, and G&A expense. Employee compensation and benefit expense was up 12% year over year, reflecting higher incentive compensation linked to higher operating income and higher performance-related compensation versus the prior year period.

Sales, asset and account expense increased 22% compared to a year ago, driven by higher distribution and servicing costs and direct fund expense. G&A expense was up 6% year over year, primarily due to higher technology investment spend, consistent with our G&A outlook provided in January. After annualizing for the impact of HPS and Preqin, we continue to expect a mid-single-digit percentage increase in full-year G&A. We continue to deliver margin expansion on recurring fee-related earnings.

Excluding the impact of all performance fees and related compensation, our adjusted operating margin for the third quarter would have been 48.6%, up 230 basis points year over year. Our capital management strategy remains consistent. We invest first in the business and then return excess cash to shareholders through a combination of dividends and share repurchases. In the third quarter we repurchased $550 million worth of shares.

At present, based on our capital spending plans for the year and subject to market and other conditions, we anticipate repurchasing at least $550 million worth of shares in the fourth quarter. That's consistent with our previous guidance communicated in July. Turning to flows, BlackRock's third quarter net inflows of $205 billion were diversified across product types, client channels, regions, and active and index strategies. ETFs generated $135 billion of net inflows in the third quarter.

Index bond ETFs and precision ETFs led the way, generating $61 billion and $41 billion of net inflows, respectively. Continued demand for our growing lineup of active ETFs added $22 billion of net inflows. Our digital assets ETPs raised $8 billion in the quarter. Our ETFs have now delivered a sixth consecutive quarter of double-digit organic base fee growth, powered by higher-value ETF categories such as active and precision.

Retail net inflows of $23 billion were driven by sustained momentum in liquid alternatives, broad-based demand for our U.S. active fixed income offerings, and continued inflows across Appirio and SpiderRock. Institutional active net inflows of $44 billion were positive across all product types and were led by strength in private markets, fixed income, systematic equities, and liquid alternatives. Institutional index net outflows of $27 billion were concentrated in low-fee index equities.

In private markets, we saw $15 billion of net inflows, mainly from deployment across infrastructure and private credit and the onboarding of a real estate mandate. This quarter we updated our earnings supplement to provide greater transparency into our private markets activity and drivers of fee-paying AUM. These include metrics such as fundraising, deployment, total AUM, and dry powder, which can be found on pages 9 through 11 of our earnings supplement. Finally, our cash management platform generated $31 billion of net inflows in the third quarter.

These results include fundings into customized liquidity solutions, demand for government funds, and continued growth from Circle. At our Investor Day in June 2025, we set out a vision and a business plan for BlackRock in 2035. Quarters into the plan, we're delivering at or well above its targets: higher and more consistent organic base fee growth; a more all-weather, durable mix of asset management and technology capabilities across public and private markets; consistent operating margin expansion; and higher earnings per share. This third quarter notched another strong step on our way to 2030.

In more uneven markets, we generated record revenue, operating income, and EPS, a more than 47% operating margin, and 11% organic base fee growth. The opportunities ahead for BlackRock continue to expand. Clients are looking for a partner that can connect the whole portfolio to navigate a new environment of capital scarcity, higher long-term yields, and a redesign of diversification. I don't believe we can evaluate the investment environment as risk-on or risk-off any longer.

This new environment is about capital allocation acumen. It's about financing advantages through scale, access, and breadth of opportunities. And it's about redesigning diversification across the client portfolio. Our industry is being reshaped by the blending of public and private markets and growing demand for technology and data to secure success in client portfolios.

These conditions play directly to BlackRock's strengths. Client engagement is higher than ever, and we enter our seasonally strongest fourth quarter with significant momentum across the firm and a long runway for growth ahead. With that, I'll turn it over to Larry. Larry Fink, Chairman and Chief Executive Officer Thank you, Martin.

Good morning everyone and thank you for joining the call. We built BlackRock to be a partner to clients everywhere capital markets are moving. We advise clients holistically across public markets, private markets and technology. We do it with a global perspective, but with a local lens.

And that reach, that ability to cover every corner of a client's whole portfolio, puts BlackRock at the center of how capital is moving in the world today. And it's showing up in our results. Third quarter earnings per share rose 38%. Our operating margins reached 47.8.

Organic base fee growth of 11% growth, reflecting net inflows of 205 billion year to date. Net inflows and organic base fee growth are both more than 45% higher than this time last year. Our results reflect the scale of BlackRock today. We generated net inflows across every asset class, every client type, every region and across both active and index.

AUM is up over $2 trillion in the last year and it has now reached 15.5 trillion. We've now operated for a full year with GIP, HPS and Preqin as part of BlackRock. This quarter is the clearest view yet of the earnings power of our integrated platform. It's helping us serve more clients' needs and create more value for shareholders.

For the first time in my career, and that's 50 years of a career, I'm seeing genuine shortages of capital. Governments are running historically large deficits, while at the same time demand for private capital is rising across the economy. Governments need financing for infrastructure. Companies need to fund a generational AI buildout.

Individuals need better ways to invest and retire. Everyone is rethinking how they deploy capital and BlackRock is at the center of many of these conversations. We're both a trusted advisor and a destination for global client capital. That's driving meaningful activity across the firm and a growing pipeline for the future.

This is especially visible through our work with the leading companies at the center of the AI buildup. We have long standing relationships with these hyperscalers and sovereign wealth funds and pension funds and corporate clients around the world. These long term relationships are now underpinning some of the largest financing engagements in the market. We partnered with Meta on the financing of its planned $14 billion data center in Texas, bringing together infrastructure investments from GIP, private financing capabilities, HPS.

We're also working alongside leading technology companies to create dedicated pools of financing for the customers to expand compute capabilities and capacity. In the near term, these can supply private placements into high grade insurance mandates. But over time there's even a larger opportunity to securitize them into tradable structures for a much broader set of clients. Rob Capito and I have lived through this playbook before.

In the early 1980s, mortgages were loans sitting on banks' balance sheets, illiquid and hard to price. Fannie Mae and Freddie Mac began pooling them, but that alone didn't make them tradable. What made them tradable was data. Years of performance history and understanding how the performance would move with interest rates and with the changes of the broader economy.

Once investors had a trusted time series of data, issuers had a standard to build against and the market opened up for a much bigger group of investors. That combination took the MBS market from a few billion dollars when I started to the trillions of dollars it is today. Compute capacity is now following a similar path and we intend at BlackRock to be the center of it, as we were then in the beginnings of the mortgage-backed securities market. BlackRock is particularly well positioned to help develop this market because we combine capital formation but most importantly technology and data and scale.

Thousands of investment professionals just participated in the Aladdin community using our analytics and risk framework to make investment decisions. AI is amplifying the value of Aladdin as we accelerate innovation and create better analytics. As compute capacity emerges as an asset class, the markets will need trusted data, standardized performance metrics and a common framework for risk analytics. These are the capabilities we've spent decades building.

They now differentiate BlackRock working alongside technology companies and investors to establish the infrastructure this potential new market will need and require. These opportunities underscore the strategic logic behind our private markets acquisitions. We're already mobilizing capital at a greater scale than ever before.