AllianceBernstein Holding LP at Goldman Sachs U.S. Financial Services Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : There you go. From what I heard, we're in the service economy and the experience economy, so this is what you're after. We're not in the infrastructure -- or maybe infrastructure, not in the manufacturing economy, so here we go. Okay. All right. With that said, let's talk about the allocation trends. So 2025 was clearly a pretty volatile year, but ultimately equity markets delivered pretty healthy returns and credit spreads are still super tight. So given the setup and also layering in lower interest rate prospects, how are clients allocating into 2026? What are some of the themes you guys are paying attention to at a macro asset allocation level?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Yeah. Super interesting. Let's take these themes and maybe translate it into some of your own business, starting with fixed income. And I feel like for the last two to three years now, you and I have these conversations, and we've always had these conversations with other CEOs of other asset managers, and there's been this wall of money that's been sitting in money market funds, waiting for that to eventually rotate into fixed-income vehicles, especially when we get a little bit of a steeper curve. It feels like we're finally starting to get there.

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Yeah, and I guess presumably when you get the the move in lower interest rates despite the fact that credit spreads are really tight, that

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : So how are you guys positioned to capture that? Because AB obviously has a very long track record of fixed income, really good long-term returns. The one-year numbers, I think, has gotten a little bit stronger. So how do you think about your competitive position if we do, in fact, see a much bigger wave of capital coming back into fixed income?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Yeah, yeah. I was really intrigued by the comments you made on the last earnings call related to your global equity franchise, and you alluded to some of that in your first response as far as the themes go. But look, clearly the active equity space for the industry has been really challenging for a long period of time. The appetite for global equities, non-US equities, to your point, is starting to improve a little bit. So let's just double-click in terms of what that means for you guys. How are you positioned to capture that rotation if and when that does start to occur?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Sure. Yeah. Well, especially, I guess, relative to where US valuations are in concentration. All right. Let's move from maybe the asset class and the product strategies to more of the wrappers and some of the channels. First, I would love to spend a couple of minutes on active ETFs. It's been a big theme for the space. It's been growing rapidly. You guys have been early. I think you're running at about $10 billion in AUM across the --

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : How are you thinking about the product roadmap here, either conversions or launching new strategies? What's most suitable for an active ETF wrapper, where you actually feel like you've got the right to win, and really just the wrapper that was the issue? So as I think about the contribution, so overall growth --

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Yeah, that makes sense. One of the features I really like about your guys' story is during earnings calls, you guys do take the time to feature different businesses, which I feel like has been always really helpful to spotlight various attributes of the firm. One of the recent ones you talked about was your presence in the defined contribution market, which is a big business for you guys, right? It's about $105 billion in assets. It seems like sales momentum has been also building quite nicely. Can you expand on how the recent advisory opinion from the DOL regarding lifetime income, and for those who don't know, maybe spend a minute on what that is?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : And really just help us think about how you're trying to further commercialize this model because those are also tend to be maybe fee dilutive. Yeah, so let's talk about it, because I think it's a complicated sector.

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Great. No, it looks like a really interesting opportunity. And to your point, there's been others that try to have these guaranteed decumulations, so having some Safe Harbor language would be helpful. LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 09, 2025 / 5:20PM, AB.N - AllianceBernstein Holding LP at Goldman Sachs U.S. Financial Services Conference

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Do you think it's the existing target date? Firms and people with already big DC footprint that will ultimately be also the winners here and own this. Obviously, it will be good for insurance companies, annuity riders, because that's a new town for them to go after. But who wins in that marketplace?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Right, right. Okay. Well, speaking of private markets, let's talk a little bit about that. So you guys have a target obviously out there. You're aiming to be at about $90 billion to $100 billion in private markets by '27. Clearly on your way there, I think you're at about $80 billion.

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : There you go. Right. So it's certainly on your way within the range.

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Yeah, I think you've said that a couple times. Even last year, I think you did. So I'm glad you're staying true to your story. Now, look, can you talk about the path of going beyond that, right? Like, to your point, you're at target. What's growing quickly? Where do you guys think the next leg of growth is? LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 09, 2025 / 5:20PM, AB.N - AllianceBernstein Holding LP at Goldman Sachs U.S. Financial Services Conference

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Yeah, so it feels like lots of room beyond this $90 billion to $100 billion.

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : So we spent -- and your answer to some of this, you talked about private credit, and I think it's worthwhile spending just a couple of minutes on that. You guys run a wide range of private credit strategies. Obviously, there's middle market lending, asset-backed finance. I would put real estate lending in the same general category.

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Totally. But when we zoom out, there's been relative to the actual issue, the number of headlines and, like, probates has been enormous in the last few months related to private credit. Anything on the ground you've seen that you find worrisome, anything within your portfolios you'll say, hey, that's worth paying attention to. And as you survey the landscape and things that you do within private credit, does anything particularly stand out?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : In which part? Like when you think of direct lending mostly, or where are you --

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Is that starting to impact your conversations with LPs at all in a negative way? Because it feels like LPs are asking questions, but we haven't really seen any material pullback from allocation towards private credit. So any of those concerns popping up or --

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Well, very fair and balanced answer. Let's pivot to maybe P&L for a couple of minutes. I wanted to start with a question around institutional pipeline. You guys, I think, as of the last quarter, were at around $12 billion of wins. I think private credit's probably a decent part of that as well, as it'll turn off to get deployed. How are you thinking about that flowing into management fees, just the pace of deployment, pace of those mandates closing?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Yeah. When we think about the revenue base and the fee rates in the business, you guys have been fairly stating this 38, 39 basis level range.

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : And there's a little bit of a barbell effect, right, because on the one hand I feel like You guys have a lot of alts that are growing. The retail business seems to be growing, and if global equities start to contribute, that's pretty attractive, but then at the same time, SMAs and some of the lower fee dynamics are also contributing. As you think about the evolution of that fee rate over the next couple of years, knowing what you hope to accomplish from an organic perspective, how does that fee rate evolve?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Yeah. Great.

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Well, and the performance fee angle had a really nice story for the last couple of years.

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Great. All right. So to just maybe wrap it up, question on profitability. I know that's been obviously a focus for you guys for the last couple of years, given some of the action steps you've made, also the divestiture of the research platform. So there's a few things that have come together to now having this 33%, 34% overall operating margin. I think this year is actually tracking a little bit below what the target was in the beginning of the year, marginally so.

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : I was looking at like 40 bps, but call it rounding. I know.

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Basis point here and there. Okay. So, but I guess if you think about similar to the fee rate, the evolution of business and where you're allocating your resources, how much runway do you still see in the operating leverage in the franchise and what drives that?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Just supply markets.

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Yeah, and I think you and many others as well. Great. We're actually right at time, so thanks so much. LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 09, 2025 / 5:20PM, AB.N - AllianceBernstein Holding LP at Goldman Sachs U.S. Financial Services Conference

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : It was great to see you, as always.

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : I can't promise you a different venue next year, but I hope you're still here.