Blackstone Inc Q2 2025 Earnings Call Transcript

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

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Thank you, good morning. I appreciate the question. I wanted to start with a question around credit, obviously incredibly powerful driver for you guys and the industry broadly -- it's been fueling growth for a couple of years now. At the same time we're clearly seeing compression and credit spreads, and I'm curious how that's playing into your client conversations where the premium to liquid market is still there, but perhaps might start narrowing when there's more capital coming in there. So any conversations around, demand for private credit whether it's from retail channels or institutional channels and any implications on fee rates longer term as we think about this product continuing to grow. Thanks.

Question: Craig Siegenthaler - Bofa Merrill Lynch Asset Holdings Inc - Analyst : Hey, good morning, Steve, Jon. Hope everyone's doing well. We had a question on strategic partners. So in your secondary fund returns accelerate in 2Q, and there is a one or two quarter delay there too, so maybe they should get even better with endowments and a few Asian institutions selling REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JULY 24, 2025 / 1:00PM, BX.N - Q2 2025 Blackstone Inc Earnings Call their (inaudible) stake and discounts wider. So I want to see if you could update us on the investment return and fundraising outlook for second half.

Question: Michael Cyprys - Morgan Stanley - Analyst : Hey, good morning. Thanks for taking the question. I just wanted to ask about 401(k) and the retirement opportunities that. I was hoping you could maybe elaborate a bit on how you see the path unfolding for all accessing the 401(k) retirement channel. It seems that target date is perhaps maybe the most likely vehicle. Just curious to get your views on that. How meaningful of an allocation could this be within the target date vehicle, not just for (inaudible) but also considering fixed income replacement and other types of strategies that you have or may have in the future, and just more broadly how you see this playing out and talk about some of the steps that you guys are taking. Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JULY 24, 2025 / 1:00PM, BX.N - Q2 2025 Blackstone Inc Earnings Call

Question: Bill Katz - Cowen and Company LLC - Analyst : Great, thank you very much for taking the question. So just coming back to some of your forward-looking guidance, can you unpack a little bit how you sort of see the interplay for the FRE margin, very strong quarter this quarter, and then relatedly as we think through the realization up cycle, how do we think about the payout rate on that? That's been pretty steady in the mid 40s. Should we assume that that's still the same kind of payout going forward? Just trying to think through the overall earnings gearing here. Thank you.

Question: Bill Katz - Cowen and Company LLC - Analyst : Thanks.

Question: Brian McKenna - Citizens JMP Securities LLC - Analyst : Okay, great. Good morning, everyone. So real estate performance eligible AUM totals around $200 billion today. Net accrued performance fee stands at less than $1 billion today. So I'm curious how much of the $200 billion is currently generating performance revenue? And then is there a way to think about how much of this AUM, call it, 10% away from the hurdle I'm just trying to get a sense of the trajectory of accrued performance fees in real estate from here as performance in underlying trends begin to normalize.

Question: Brian McKenna - Citizens JMP Securities LLC - Analyst : Great. Thanks Michael.

Question: Benjamin Budish - Barclays Services Corp - Analyst : Hi, good morning and thank you for taking the question. I wanted to ask something kind of specific on your fee related performance revenues. It looked like the performance in the quarter or at least the outperformance versus a lot of expectations, was driven by private equity, which I would assume is more bit than people were expecting. I know that's one that can be a bit lumpy based on the timing of fundraising and deployment with the big sort of three year crystallizations, but any color you could share in terms of what FRPR can or might look like over the at least the next couple of quarters, would be helpful. Just for modeling purposes. Thank you.

Question: Benjamin Budish - Barclays Services Corp - Analyst : Okay, thank you for that.

Question: Kenneth Worthington - JPMorgan Chase & Co - Analyst : Hi, good morning, thanks for taking the question. With regard to Legal & General, you mentioned $20 billion over the next five years. Is this based on new products expected to be developed and distributed, or is there an IMA or more immediate asset management element of the partnership as well? And then last quarter, you mentioned Wellington and Vanguard. Can you give us an update on product development, how that's progressing and when we might see those products start to hit the market?

Question: Kenneth Worthington - JPMorgan Chase & Co - Analyst : Great, thank you.

Question: Patrick Davitt - Bernstein Autonomous LLP - Analyst : Hey everyone, good morning. You mentioned the Life Sciences performance and the divergence between PE and real estate and have obviously built a great business there. But there seems to be a fairly significant cut to government research and science funding coming through the pipe. Do you have any early thoughts on how much exposure your portfolios could have to that? And does that cut and funding change your view on the life sciences investment opportunity from here? Thank you.

Question: Arnaud Giblat - Exane Bnp Paribas - Analyst : Yeah, good morning. One quick question on BXPE, please. So there's clearly been a lot of appetite for this product. I'm just wondering how you're thinking about sizing of this product in relation to capacity to deploy in retail, in particular, as you might be thinking about vintage diversification, how should we be thinking about the potential divergence in construction between this wealth products and your flagship. Thank you.