Carlyle Group Inc 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 : Carlyle, obviously, is coming off of a really strong year, record FRE over the last 12 months. I think about $60 billion of inflows over the last six months as well with increasingly a more diverse set of products when we think about secondaries and credit and other things you guys are doing in the wealth channel. So on a clearly strong path. And look, I mean, the stock has not gone unnoticed. I wanted the best, if not the best performers in the space this year as well. So all good things. Look, why don't we start with a bit of a macro question first. Just given the breadth you guys have, especially across the private equity business, across the globe, talk to us a little bit about what you're seeing on the ground in terms of corporate health, what are some of the bright spots? And what are the some of the fundamental risks you guys are seeing across your portfolio companies?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Great. Well, it's a good way to set the stage for the conversation for the next 30 minutes-or-so. Let's kind of break this down into some of the individual businesses, really starting with private equity. Now you're stepping into the Global Head of Private Equity role, which is a large business for Carlyle. It's not, of course, the only business, but it's an important one. And frankly, it's still probably the biggest source of debate among investors as far as just the trajectory for that business goes for you guys. So as you enter that role, first and foremost, what are the key priorities for you? And what's sort of on your to-do list for 26 as Global Head of Private Equity?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Yes. Let's spend a couple more minutes here, and I really was hoping to address both performance and then some of the fundraising dynamics. Let's start with performance first. So CP7, CP8. So net IRRs for both funds are in kind of the 8% to 9% range. The market is probably sort of nervous still about what is the ultimate outcome is going to be for really both of those. Obviously, CP8 stacks up a little better than CP7. But when you look at the underlying portfolio company performance, how is that tracking relative to your expectations, the original kind of budget that you put together? And what do you ultimately see as performance for these vintages shaking out to be?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Yes. Let's spend a couple of minutes on CP9 and really just the way you view the corporate private equity business over time, where I think in the past, you and Harvey talked about CP9 being sort of similarly sized to --

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Of course. Let me take them and double check that. So -- but is that still the expectation, right? Is it about the same size as kind of what you're hoping for? Is that the feedback you're getting would sell from some --

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : That's helpful. And when you think about just broadening out the growth profile of corporate private equity, in general, I know you mentioned maybe leading into some of the things that are subscale. You've had problems in Europe, obviously. So that's been a smaller fund. How do you think about like kind of franchise growth outside of the flagship fund that could eventually maybe reinvigorate growth in the entire franchise of us?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Yes. Great. Okay. Let's pivot. I would love to spend a minute on monetizations. That's an area where you highlighted as well that you're starting to see some really good momentum. Obviously, there's an IPO out there that's proceeding. Looking out into 2026, what are the general expectations for realization activity and more importantly, for the net PRE knowing that there is some timing dynamics and kind of the waterfall things you have to work through to actually convert some of the sales into PRE? 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 / 4:20PM, CG.OQ - Carlyle Group Inc at Goldman Sachs U.S. Financial Services Conference

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Great. We talked about dynamics in private equity in terms of growth and fund rates, but maybe kind of zoom out a little bit broader and talk about the franchise as a whole. So when I look at the inflows you guys seen so far this year, about $45 billion raised year-to-date, you're kind of on track to do $50 billion-plus/minus something like that in that range. Into 2026, how are you thinking about fundraising across the franchise? And what are your expectations?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Yes. And I guess as a follow-up to that, maybe translating some of this fundraising dynamic into actual top line growth and management fee growth. And it's interesting, right, because 2025 was a really good year for you guys. Within that, there's a bunch of catch-up fees which makes '26 as a bit of a difficult comp, right? So it's just math, frankly. 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 / 4:20PM, CG.OQ - Carlyle Group Inc at Goldman Sachs U.S. Financial Services Conference But the reality is a lot of this is timing because the fundraising dynamics that you've outlined really won't accrue probably until 2027, just the way the management fee kind of waterfall works out. So how do you think about the management fee growth for the firm in '26 and if that's not really the right way to measure performance, maybe on a multiyear basis, what do you think Carlyle is capable of delivering from a management fee growth perspective?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Yes. Got it. Fair enough. Why don't we talk a little bit about the bulk channel? Clearly, very important for you guys. Very important for industry as a whole, and Carlyle has been making really good progress building out your wealth footprint led by CAPM, but also you have credit dedicated products, CTAC and you recently launched secondaries only version I guess and then you also have CPAP, the private equity front, right? So you're really kind of rounding out the offering there. So talk to us a little bit about how you're looking to scale these products over the next 12 to 18 months? And then particularly related to the private equity fund, CPAP, how are you differentiating this one versus some of the other private equity strategies in the wealth channel that have already been out there raising capital?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Great. What about other product development? So I know you have asset. You have products in a number of asset classes today. What else is interesting on the horizon? What do you envision the wealth product solution ultimately looking like? And then we've obviously seen a number of your peers partner with traditional managers on hybrid products, JVs in a way. We haven't really seen you guys do that. So maybe I think you talk to us a little bit the pros and cons of something like that.

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Great. The growth in the wealth channel has obviously been really, really critical, but it's also having -- creating interesting nuance relative to the way private markets have existed, which has been entirely institutional. And as part of that institutional investors have been used to

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Yes. That's great. Okay. Let's talk about the AlpInvest business for you guys, really enormous success here over the last couple of years across several verticals with that, but the secondaries business in the co-invest obviously, the two largest there. As you think about the current supply demand dynamics in the market, and you mentioned those funds are actually pretty far along in their investment cycle already. And as you kind of gear up for the next vintages, how you think about timing and sizing? So that's kind of part A. And part B, giving all the interest in the space around secondaries in particular, what are some of the adjacencies that you see AlpInvest kind of building out into over time that it might not be really needle-moving today, but could be bigger three years from now?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Yes. Great. Look, another business that you guys sound pretty optimistic about is asset-backed finance sits within your credit franchise. I believe you guys have six origination partnerships across the business. So maybe spend a couple of minutes on how these partnerships contribute to capital formation across the Carlyle kind of credit complex as a whole? And I guess, opportunities you see to further scale the asset-backed finance business given all the kind of enthusiasm that is out there from the market?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Once again, into multiple trillions. It doesn't even matter.

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Yes. Having you in the CFO role for maybe couple of more weeks. I figured we'll throw a couple of P&L questions for your way as well. Let's talk about the FRE margins. Obviously, Carlyle has been investing into a number of key initiatives that are starting to scale nicely, whether it's retail, secondaries, asset-backed finance you just talked about, how should we be thinking about the more normal pace of annual FRE margin expansion for the business? And how would you frame incremental margin uplift from stronger PRE or stronger capital markets revenues, right? Because there is a lever there with more PRE, there's actually room for FRE margin to expand as well. So how should we think about both of those?

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Great. All right. My last question for you to just wrap it up. Let's talk about the share repurchases. That was always part of the -- you had a framework that was sort of introduced, I guess, when new management, you and Harvey, came on to pivot away from the prior strategy. So

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Great. Perfect. All right, we'll leave it there. John, thank you so much. Great to see you.