BlackRock Tops $12T in AUM. State Street Profits Tumble
A handful of asset managers reported earnings Tuesday.

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Much of Wall Street is expecting a possible market slowdown in the second half of the year, so it’s a good thing it hit some high notes beforehand.
It’s earnings season, which is often a time to celebrate victories, and BlackRock hit a big one. The New York-based firm reported Tuesday that its assets under management grew to a record $12.5 trillion in the second quarter, up 18% year over year, putting it in a league of its own. Still, shares slid more than 5% on Tuesday, with BlackRock CEO Larry Fink attributing the move to investor concerns over the company’s expenses.
Meanwhile, Boston-based competitor State Street reported $5.1 trillion in AUM as well as $49 trillion in assets under custody, a 17% and 11% increase year over year, respectively. Basically, two of the world’s largest asset managers just got a lot bigger.
BlackRock’s Big Day
The firm’s success in the first half of the year has been driven by high stock prices, massive inflows, and BlackRock’s push into private markets:
- In February, BlackRock completed its purchase of private markets data provider Preqin. BlackRock’s alternatives held roughly $302 billion at the end of the quarter.
- Year-to-date, BlackRock has experienced $152 billion in total net flows, led by a record first half for iShares ETFs.
Also, on the private market front, BlackRock completed its acquisition of private credit firm HPS Investment Partners this month and agreed to acquire ElmTree Funds, a real estate-focused private-equity firm. Starting next year, BlackRock plans to expand access to alternatives by including private assets in target-date retirement funds.
“This is a place that we have particular strength and can add a lot of value, rather than just rote allocations of X percent to public markets and Y percent to private markets,” Martin Small, BlackRock CFO, said on an earnings call Tuesday.
Win Some, Lose Some. State Street’s low-cost offerings were a win this quarter as many investors sought out affordable ETFs over mutual funds. The company generated nearly $3.5 billion in revenue this past quarter, bolstered by an 11% jump in fees year over year.
However, despite higher revenue, profits fell as total expenses reached $2.5 billion in the second quarter, also up 11% compared with this time last year. State Street’s expenses went toward workforce reorganization, technology upgrades and higher performance-based incentives. Like they say, you gotta spend money to make money.
– Griffin Kelly