KKR & Co Inc Q2 2025 Earnings Call Transcript

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

Question: Craig Siegenthaler - Bofa Merrill Lynch Asset Holdings Inc - Analyst : Good morning, Scott, Rob. Hope everyone's doing well, and thanks for taking my question. You called out K-Series Credit in the release, and we wanted to circle back on K-FIT. This was previously somewhat of a gap for KKR and wealth, but it's been progressing as of late. So I was hoping you could update us on the fundraising front, progress on platform additions, and how this product is differentiating itself versus an increasingly crowded field of players in private wealth.

Question: Alexander Blostein - Goldman Sachs Group Inc - Analyst : Hey, good morning. Thank you guys for taking the question. I wanted to zone in a little bit on the institutional dynamic. The environment, of course, has changed drastically relative to prior quarter's call. I know we've talked in the past more about, I guess, a barbelled approach to institutional fundraising. 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 31, 2025 / 1:00PM, KKR.N - Q2 2025 KKR & Co Inc Earnings Call But given a better outlook for monetization activity, obviously, a much healthier equity market as well, is that still the case? How are you sort of gauging the pulse of institutional clients as you go through this fundraising cycle?

Question: Benjamin Budish - Barclays Services Corp - Analyst : Hi, good morning, and thank you for taking my question. Helpful updates on Global Atlantic in the prepared remarks. I was wondering if you could unpack a little bit more of just the performance in the quarter itself. What specifically changed that led to the outperformance versus your prior guide of kind of around $250 million for the next couple of quarters? And then as we think longer term, how important is the sort of elongation of the liability profile? How dependent is that on the FABN market or sort of pivoting the liability profile of your retail flows? Does one matter more than the other? And how long may that take to kind of get to where you want it to be? Thank you.

Question: John Barnidge - Piper Jaffray Inc - Analyst : Good morning, and thank you for the opportunity. Can you talk about the opportunity presented for the company from potential 401(k) retirement reform and how meaningful this could be? Thank you.

Question: Michael Cyprys - Morgan Stanley - Analyst : Hey, good morning. Thanks for taking the question. More of a bigger picture question for you guys on AI and blockchain. Just as you look out over the next 5, 10 years, curious how you see the industry evolving given potential changes here from AI to blockchain. Curious how you're adjusting your business model. What steps are you guys thinking today and might take in the coming years? And what this all mean for your business? Thank you.

Question: Bill Katz - Cowen and Company LLC - Analyst : Okay, thank you very much. Good morning, everybody. So just coming back, one of the pushbacks we get on KKR and the group at large is as the industry continues to scale, particularly in private credit, that the ability to drive differentiated returns goes down. We don't agree with that. We think scale will win. But that being said, I'm sort of curious if you could maybe update us on your origination platform. I know a couple of your peers do a pretty good job of delineating what their capacity is. I'd be curious, maybe get a little bit of a refresh of just number of origination platforms you have, and why you think that could translate into the ability to generate further alpha. Thank you.

Question: Patrick Davitt - Bernstein Autonomous LLP - Analyst : Hey, good morning, everyone. To your prepared remarks, KKR obviously in a good position with its large high MOIC public position. But commentary from other execs and even the tangible data, we see still suggest that strategic seem to be hesitant to buy sponsored-backed companies more broadly. So could you update us on your conversations with strategic buyers, where you think that bid-ask is now? And what do you think needs to change to really open up that side of the realization equation? Thank you.

Question: Brian Bedell - Deutsche Bank AG - Analyst : Great. Thanks. Good morning. Thanks for getting my questions. Just a two-parter, if I may. One, on the investment management fees in both private equity and real assets, they were ahead of our estimates and I think ahead of consensus. I know the Fund XIV turned on. Just trying to get a sense of, is there anything else unusual in terms of like catch-up fees or anything else? And I think there's maybe some step-down dynamics that might go into third quarter. So any kind of color you could give on that? And then the second question is, just good capital market momentum. And obviously, the environment seemingly good into the second half. So I just wanted to get your view on whether you think the capital markets fees can be even stronger in the second half than they were in the first half.

Question: Arnaud Giblat - Exane Bnp Paribas - Analyst : Good morning. Thank you for taking my question. I'd like to come back to the KKR-ECP joint venture and just a follow-up on that question. So I was hoping to get a bit more color around the $50 billion JV there in terms of how this money gets deployed. I mean, part of that is going to go through existing funds, if I understood well. And the rest probably through SMAs and co-invest. I'm just wondering if you could give us a bit of color around that. Also, I mean, clearly, there's ECP in that joint venture. So what's -- how should we think about the split of that $50 billion between you and your partner? And in terms of timing, how long should we be looking for the deployment of those $50 billion? Thank you.

Question: Brian McKenna - Citizens JMP Securities LLC - Analyst : Great. Thanks for squeezing me in. I appreciate all the detail this morning. I just had a quick question on the trajectory of earnings over the next 12 to 18 months. So you're on track to generate about $5 of adjusted EPS in 2025. That implies about 40% earnings growth in '26 to get to the low end of your target. So can you just help us bridge the gap here, and what some of the bigger drivers will be for this earnings growth over the next four to six quarters?

Question: Kyle Voigt - Keefe Bruyette & Woods Inc - Analyst : Hi, good morning. So, Rob, you just mentioned management fee growth as a kind of key part of the algorithm to how to get to your targets for 2026. I'm just wondering if I can get some clarity on 2025. I know you previously outlined that you could see a bit of an acceleration in '25 versus the 14% realized in 2024. I think you posted 15% in the first half of the year, but that accelerated to 18% in 2Q with NA XIV turning on. 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 31, 2025 / 1:00PM, KKR.N - Q2 2025 KKR & Co Inc Earnings Call So just wondering if we can get update on how to think about second-half management fee growth. Is that 18% year-on-year growth rate the right jumping off point for the second half of the year? And then any other notable activations or final closes to call out for 2H? I know Infra V is still in the market. So anything to call out there from a timing perspective?