BlackRock Hits Record AUM as Wall Street Banks Report Solid Earnings

The world’s largest investment company just got even bigger.

In the second quarter, BlackRock raked in $51 billion of new client cash, bringing its assets under management to a record $10.6 trillion and making it a standout in a season of all-around lavish bank earnings.

Despite that good news, the New York-based asset manager’s quarterly revenue came in below expectations. BlackRock generated $4.81 billion in revenue, not the $4.86 billion Zacks Investment Research had estimated. Still, it was an increase of 8% year-over-year.

CEO Larry Fink attributed BlackRock’s healthy performance to growth in private markets, retail active fixed income, and the company’s ETFs, “which had their best start to a year on record,” with investors adding $139 billion to the asset class in the first half of the year.

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While the Federal Reserve figures out its will-they-won’t-they relationship with rate cuts, the economy is still in a boom — or at the very least, a rebound — period. As a result, BlackRock wasn’t the only one on Wall Street making waves this past week — plenty of major banks beat their earnings expectations:

• Goldman Sachs’ profits more than doubled in the second quarter to $3 billion, thanks to a resurgence in dealmaking. According to a PwC analysis, overall deal value in the US for the first five months of 2024 totaled $535 billion, up nearly 30% from the $412 billion in the same period last year. Many of those deals are being driven by AI-related mergers and acquisitions.
• JPMorgan Chase topped expectations, with profits hitting a record $18.1 billion. Its second-quarter success was due to investment banking fees surging 52% year-over-year and the bank’s strategic sale of its stake in Visa Inc., which netted America’s biggest lender a gain of $7.9 billion.

Not Good Enough: While it sounds like good news for everyone, sometimes it takes more than beating earnings expectations to impress investors. Wells Fargo and Citigroup surpassed analysts’ profit projections, but both banks’ stocks took hits after releasing their quarterly reports last week. The companies were among the worst performers on the S&P 500 by market close Friday. Tough crowd.