GCM Grosvenor Inc.

Good day and welcome to the GCM Grosvenor second quarter 2026 results webcast. Later, we will conduct a question and answer session. If you were interested in asking a question, please ensure you dial in using the numbers you have been provided for this call and press star one on your keypad to join the queue. If anyone should require operator assistance, please press star zero on your telephone. As a reminder, this call will be recorded. I will now like to hand the call over to Stacie Selinger, Head of Investor Relations. You may begin.

Thank you. Good morning. Before we discuss our results, a reminder that all statements made on this call that do not relate to matters of historical fact should be considered forward-looking statements. This includes statements regarding our current expectations for the business, our financial performance, and projections. These statements are neither promises nor guarantees. They involve known and unknown risks, uncertainties, and other important factors that may cause our actual results to differ materially from those indicated by the forward-looking statements on this call. Please refer to the factors in the risk factor section of our filings with the SEC related to these statements. We'll also refer to non-GAP measures that we view as important in assessing the performance of our business. A reconciliation of non-GAP measures to the nearest GAP metric can be found in our earnings presentation and earnings supplement, both of which are available on our website. Thank you again for joining us. And now I'll turn the call over to Michael Sacks, our chairman and CEO.

Michael Sacks Thanks, Stacie. And thank you to all listening to the second quarter 2026 earnings call. I'm pleased to report that GCM Grosvenor had another strong quarter, both generating returns for our clients Thank you. Thank you. Thank you. We saw an increase in fundraising from the first quarter's $1.5 billion to $2.3 billion in the second quarter, bringing first half fundraising to approximately $3.9 billion. Importantly, those results were again broad-based across the platform. We continue to expect second half fundraising to exceed the levels experienced in the first half and are pleased to report that our pipeline remains full. Credit was the largest contributor to second quarter fundraising, accounting for more than $900 million of the $2.3 billion raised in Q2, making credit $1.4 billion of the first half's $3.9 billion of fundraising. John is going to go into some detail on our credit vertical in his remarks. It's worth mentioning that the individual investor and insurance channels were significant drivers of fundraising, representing 23% and 18% of our year-to-date fundraising against the 5% and 4% of AUM they represented respectively at the start of the year. As you know, both channels are areas of focus for us. From a revenue and profitability perspective, we saw second quarter fee-related revenue grow by 11%, fee-related earnings Thank you for joining us. Last quarter, we were specifically asked about SpaceX, and we said that we thought that in the wake of a successful IPO, it would likely be appropriate to address that exposure. And so I want to do that now. GCM Grosvenor, in our ARS and private markets portfolios, through primary fund allocations to managers, direct investments into dedicated vehicles and secondary market share purchases, Invested approximately $150 million in SpaceX, a conservative sum for our capital base. The average cost of our investment is approximately $6.37 per share, and as of last week's market close, those investments had a value of approximately $3.5 billion split fairly evenly between ARS and private market portfolios. While these gains have not yet been realized and generally remain subject to lockup, that investment is the largest single issuer gain in the history of the firm. For the overwhelming majority of our SpaceX exposure, the timing and form of exit is controlled by underlying managers. Should we receive shares in a distribution, we will decide on a course of action in real time based on facts and circumstances. The SpaceX investment is a good example of the strength of our origination platform and the breadth and quality of opportunities we can bring to investors, as well as the way our various verticals strengthen and enhance the whole of our firm for our investors. We are of course pleased with this investment thus far. Given the magnitude of the SpaceX success, Real-time versus one-quarter lag timing differences in mark-to-market policy between ARS and private markets and stock price variability. We feel it is important to highlight for all of our constituents ARS returns both inclusive and exclusive of SpaceX Impact. For the quarter, our ARS multi-strategy composite delivered gross returns of approximately 14% Thank you for joining us today. The combination of strong second quarter investment performance and positive net ARS inflows drove a 22% year-over-year increase in ARS fee-paying AUM as of June 30th, and our ARS pipeline remains full. Investment results were also strong across private market strategies without the benefit of the SpaceX IPO marks, where private equity, infrastructure, Real estate and private credit all delivered positive quarter over quarter performance. We remain long origination with considerable operating leverage, meaning our sourcing capacity meaningfully exceeds our current investment pace, leaving substantial room to scale activity without sacrificing selectivity. The middle market, the area of private markets where we primarily operate, has held up better than the broader private equity market. While deal activity and realizations are not yet firing on all cylinders, we see the opportunity for a pickup in activity and acceleration of realizations going forward. The precise timing of that is not predictable. Importantly, as we have discussed in the past, we have a high ratio of firm unrealized carry relative to market cap, meaning that as the realization environment improves, there's significant upside to our earnings. Thank you for joining us. Thank you, Michael.