BlackRock Inc Q3 2024 Earnings Call Transcript

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

Question: Craig Siegenthaler - BofA Global Research - Analyst : Hey. Good morning, Martin. Hope everyone's doing well. So my question is on the net flow trajectory. From your broad-based client conversations and your current institutional and funded wind pipeline, do you expect the acceleration re-risking activity continue into next year, post the election? And if your long-term net flow strengthen or stay strong given that they're already pretty strong in the third quarter, should we expect any outflows in your money market business, which I know might be somewhat protected given the institutional scale?

Question: Michael Cyprys - Morgan Stanley - Analyst : Hey. Good morning.

Question: Michael Cyprys - Morgan Stanley - Analyst : Hey. Congratulations on the strong quarter here. And great to see the meaningful operating leverage as well in the quarter. So just curious how you're pacing investment spend here into '25? How is that evolving? And what are some of the levers to drive margin in the 12 to 18 months? Maybe you can update us on where you are along the journey of variabilizing your expenses?

Question: Alex Blostein - Goldman Sachs - Analyst : Hello, Laurence and Martin. Good morning. Question for you guys on private markets. There's a couple of topics, but maybe starting with GIP, helpful to maybe just to get a mark-to-market on some of the financial elements. I know Martin, you talked about $250 million, I think, in management fee in the fourth quarter. Can you talk a little bit about how you see that evolving into 2025? What are some of the kind of fund flow dynamics on the legacy GIP side? And what are some of the things that you guys are working with them together? And also, if you could just remind us what the operating margin on that business is as well out of the gate as well. Thanks.

Question: Dan Fannon - Jefferies - Analyst : Sorry, can you hear me?

Question: Dan Fannon - Jefferies - Analyst : Okay. Great. Sorry about that. I was hoping you could discuss your appetite for additional M&A? And what constraints you have financially, but more importantly, as a management team to appropriately integrate the recent deals and really maximize the opportunity you have with these transactions?

Question: Glenn Schorr - Evercore ISI - Analyst : Hi. Thank you very much. So I think we're all pretty impressed with the broad growth that you keep putting up and huge margins, too. So I want a high-level question, you mentioned the word multiple expansion once or twice during the conversation, and just I think earnings growth needs to be part of the equation too. And you have strong growth in everything. You have big margins. I'm just curious why 5% EPS growth this quarter. Should we expect these initiatives as they layer in and you consistently hit the targets to actually bring the earnings growth along with it, too. I appreciate that. Thanks.

Question: Brian Bedell - Deutsche Bank - Analyst : Great. Thanks. Hi, good morning. Congrats on a great quarter. Maybe just back to the 5% organic base fee growth and maybe a different angle on this in terms of the fee rate. Obviously, the rate's going up with the GIP acquisition of that 0.5 to 1 basis point. Do you feel better now than you have maybe in a long time on the potential for the fee rate to either be stable or even move up sequentially in the next several years versus the fee pressure that you've seen? And I know that's all been due to mix in the past. But now the composition of your future organic growth seems to be tilted more towards the private markets, towards higher fee products versus obviously some of the lower mandates that you've been bringing in and also the core iSeries -- iShares, of course, your iShares, sorry. So bottom line is, do you feel better about that fee rate growth potential? And maybe if you can just touch on the model portfolios partnership as well in terms of the organic growth potential there.

Question: Bill Katz - TD Cowen - Analyst : Okay. Thank you very much.

Question: Bill Katz - TD Cowen - Analyst : Good morning, everybody. Happy anniversary.

Question: Bill Katz - TD Cowen - Analyst : I think I was there at the beginning, had to say. Indeed, I remember that meeting like was yesterday. So a question for you. I was very intrigued by your statement about revolutionizing the wealth management opportunity. I was wondering if you could maybe unpack that a little bit. I think you mentioned that the whole portfolio opportunity could be better than everything on the evergreen side to date. And just wondering if you could expand your thinking a little bit, just so we get a sense of the magnitude and the opportunity and maybe any go-to-market strategy we should be thinking about as we look into the new year? Thank you.

Question: Ben Budish - Barclays - Analyst : Good morning and thank you for having me in the call. Wanted to ask about your ambitions in digital assets to maybe changed up a little bit. It seems like one way or another, we're going to have a new President next year who's going to be more friendly to the industry, and it could take some time to see new rules and regulations. I'm just wondering, what do you see as the key opportunities for BlackRock that this change in posture from Washington could unlock sort of beyond the ETF business and some of the other custody things you do? Thank you.

Question: Brennan Hawken - UBS - Analyst : Hey. Good morning. Thanks for taking the question. Curious whether you all have seen any changes in the RFP activity on the fixed income side? There's recently been some regulatory issues at a large institutional bond manager. So kind of curious about what you're seeing in the market there on the back of that.