Apollo Global Management Inc Q1 2025 Earnings Call Transcript

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

Question: Glenn Schorr - Evercore ISI - Analyst : Hello, there. I apologize in advance. I want to try to simplify the conversation, even though you gave us a lot on SRE. And I'm thinking, a couple of years ago, we thought we were growing, I would say, call it mid-double digits. We brought that guide down to 11%, and now we're coming down to mid-single digits just this year. I like you being conservative to the environment and waiting for a fat pitch. I like the growth that you've seen. So can we break down the lower SRE on which piece is the conservative part of the investments and what conditions could make you less conservative and put that money to work sooner? And then the flip side of it is we didn't talk that much of there is a higher cost of funds. Cost of funds is up 28%. I'm assuming that's tied to funding agreements. But maybe we could try to simplify between the asset side and the liability side, and then we can understand which is the conservative piece versus the market environment. Thanks.

Question: Steven Chubak - Wolfe Research - Analyst : Hi, good morning. Thanks for taking my questions. So I was hoping to get some perspective on the wealth outlook. It sounds like you guys are continuing to see really good momentum. I was hoping you could speak to how flows were in AAA this quarter, where you guys are in the distribution or platform journey at the moment, and if you could provide more context just on the durability of those April flows and how it informs your outlook from here.

Question: Alex Blostein - Goldman Sachs - Analyst : Hi guys. Good morning thank you. I was hoping we could expand the fundraising conversation a little bit more broadly. It obviously feels like retail and the wealth channel continues to be durable with respect to the current market uncertainty. When you think about how your institutional client base is responding, and appreciate you guys actually don't have a large flagship fund in the market today, which might be might actually be a good thing right now. But as you think about other sources of institutional demand in-light of this volatility, how much more I guess, durability do you see within that channel relative to maybe some of the other parts of the market?

Question: Bill Katz - TD Cowan - Analyst : Great. Thank you very much. So Marc, a couple of big-picture questions for you. I always appreciate your perspective on this. You talked about sort of the intersection between public and private, and you've been positioning your franchise for that for a while. But a couple of your peers have mentioned a sort of link-up on that sort of migration for the traditionals trying to chase the private side and expanding distribution on both sides. So you have KKR now with Capital Group, Blackstone working with Wellington and others. Where do you stand in terms of maybe a broader linkage to potentially participate in that? And then secondly, just given the strong momentum of the business, how are you thinking about large-scale M&A? I guess there is a large transaction out there where Apollo has been now sort of publicly linked to that. I'm sort of curious of your appetite to sort of build into that channel as well. Thank you.

Question: Patrick Davitt - Autonomous Research - Analyst : I have a follow-up on that last point. You have been quietly launched on I guess, more quietly launched than others on this hybrid illiquid, liquid product with Lord Abbett. I think a few weeks before, the other big partnership launched. Could you give more color on where that stands in getting distribution and any broader thoughts on being able to talk about when you think there could be a more tangible view of what demand even really looks like for these hybrid products? Thank you.

Question: Ken Worthington - JPMorgan - Analyst : Hi, good morning. Thank you for the question. You talked about tokenization as one of the innovations that will be meaningful for private assets over time. I was hoping you could help us link the two, and how you see tokenization driving maybe its greater alternative access and ultimately driving greater alternative asset growth. But help us link the two together.

Question: Michael Brown - Wells Fargo - Analyst : Hi, good morning. Thanks for taking my question. So there has been a lot of negative headlines related to foreign LPs and endowments and kind of reducing their allocations to private markets or foreign LPs, allocating less to the US So Marc, from your perspective, is this a true risk for the industry? Should we be worried about the potential backlash for US managers or desire to invest less in the US? And then it would seem to me that Apollo would be more insulated from this dynamic just given your business mix, but just curious about how you think about your potential exposure here.

Question: Benjamin Budish - Barclays - Analyst : Hi good morning. Thank you for taking my question. Marc, in your prepared remarks, you talked a lot about liquidity in public markets. I was wondering if you could talk a little bit about liquidity in private markets. It's something the media has kind of reported that you are poking around in, providing more liquidity to the paper that you're originating. It is clearly part of what is required for your partnership with State Street for the ETF. So just curious if you could talk a little bit about your activities in terms of providing liquidity for private credit. How much capital this sort of requires and what your ambitions are there? Thank you.

Question: John Barnidge - Piper Sandler - Analyst : Good morning. Thank you for the opportunity. I know in some of your prior answers, you said it's not about how many partnerships and asset manager or financial sponsor can start, but how many assets they originate that offer risk reward, and you have those origination capabilities. How far off do you think the alternative space is from something that happened in the 401(k) space, where the biggest providers garnered all the assets and then it became a consolidation opportunity for those at the top? Thank you.