BlackRock, Inc.

with the SEC, which lists some of the factors that may cause the results of BlackRock to differ materially from what we see today. BlackRock assumes no duty and does not undertake to update any forward-looking statements. So with that, I'll turn it over to Martin.

Thanks, Chris, and good morning, everyone. It's my pleasure to present results for the third quarter of 2025. Before I turn it over to Larry, I'll review our financial performance and business results. Our earnings release discloses both GAAP and As Adjusted financial results. A reconciliation between GAAP and our As Adjusted results has been included in the tables attached to today's press release. I'll be focusing primarily on our As Adjusted results. At BlackRock, we always challenge ourselves to raise the bar, and our results consistently reflect that mindset. We've been focused on building capabilities that we anticipate our clients will need in the future while also implementing some of the largest and most multifaceted mandates in our history. This combination of forward-looking investment and consistent execution has fueled strong results across our business. The momentum we saw in the first half of the year accelerated in the third quarter. Our builds across ETFs, private markets, whole portfolio and cash management drove 8% organic base fee growth over the last 12 months. That's our highest level in over four years, but even more importantly, it's broadly diversified. We have great momentum across both our foundational businesses and categories that we've developed in just the last few years. That strength and diversification is resonating in meaningful opportunities across regions, client channels, product types, and asset classes. We're entering what's typically our seasonally strongest quarter and coming off significant milestones in just the last 90 days. Since July 1st, we've closed our acquisitions of HPS and Elm Tree, announced an $80 billion SMA solution with Citi Wealth, and onboarded a $30 billion pension mandate. These represent just the start of what our newly integrated platform can unlock. We've expanded our capabilities across private markets, digital assets, data, and technology. That strategy now moves forward with greater strength and scale. The opportunity in front of us far exceeds what we've ever seen before. We finished the third quarter with record AUM, record units of trust of 13.5 trillion. Over the last 12 months, clients entrusted BlackRock with nearly 640 billion of net new assets, powering 8% organic base fee growth. We generated 205 billion of net inflows in the third quarter, reflecting 10% annualized organic base fee growth, our highest quarter since 2021. This organic base fee growth was driven by broad-based client demand for iShares, private markets, systematic outsourcing, and cash strategies. These are all capabilities we've invested in over recent years and demonstrate the success of our structural growth strategy. Moving to financial results. Third quarter revenue of $6.5 billion was 25% higher year over year, driven by the acquisitions of GIP, Prequin, and HPS, organic base fee growth over the trailing 12-month period, and the positive impact of market movements on average AUM. Operating income of $2.6 billion was up 23% year over year. Earnings per share of $11.55 increased 1%, reflecting higher operating income offset by lower non-operating income and a higher diluted share count in the current quarter compared to a year ago. The higher share count included 6.9 million shares issued at the close of the GIP transaction on October 1st, 2024, and 8.5 million BlackRock SubCo units issued at the close of the HPS transaction on July 1st. The SubCo units are exchangeable on a one-for-one basis with BlackRock Common Stock and included, as if converted, in the company's fully diluted shares outstanding. Non-operating results for the quarter included 84 million of net investment losses, primarily due to a mark-to-market non-cash loss linked to our minority investment in circles. Our as-adjusted tax rate for the third quarter was approximately 24% and benefited from discrete items. We continue to estimate that 25% is a reasonable projected tax run rate for the fourth quarter of 2025. The actual effective tax rate may differ because of non-recurring or discrete items or potential changes in tax legislation. Third quarter base fee and securities lending revenue of $5 billion increased 25% year-over-year, reflecting the positive impact of market beta on average AUM, organic base fee growth, higher securities lending revenue, and approximately $215 million and $225 million in base fees from GIP and HPS, respectively. On an equivalent day count basis, our annualized effective fee rate was approximately five-tenths of a basis point higher compared to the second quarter. This increase was primarily due to the onboarding of higher fee alternative credit assets of HPS, which was partially offset by $48 million of lower private markets catch-up base fees compared to the second quarter. Performance fees of $516 million increased 33% from a year ago. primarily reflecting approximately $270 million of performance fees from HPS. Quarterly technology services and subscription revenue was up 28% compared to a year ago, reflecting sustained demand for our full range of Aladdin technology offerings and the closing of the Prequin transaction, which added approximately $65 million of revenue in the third quarter of this year. Excluding Prequin, technology services revenue would have increased approximately 12% year over year. Annual contract value, or ACV, increased 29% year-over-year, including the impact of Prequin. ACV increased 13% organically. Total expense was 26% higher year-over-year, primarily driven by higher compensation, sales asset and account expense, and G&A expense. Employee compensation and benefit expense was up 33% year-over-year, primarily reflecting higher incentive compensation associated with performance fees. as well as higher operating income. The year-over-year increase also reflects the impact of the onboarding of GIP, Prequin, and HPS employees. G&A expense was up 18% year-over-year, primarily due to M&A transactions and higher technology investment spent. Sales asset and account expense increased 21% compared to a year ago, driven by higher direct fund expense and distribution costs. Direct fund expense increased 22% year-over-year, 5% sequentially, primarily as a result of higher average ETF AUM. Our as-adjusted operating margin of 44.6% was down 120 basis points from a year ago, reflecting the impact of higher performance fees and related compensation. We continue to deliver margin expansion on recurring fee-related earnings. Excluding the impact of all performance fees and related compensation, our adjusted operating margin for the third quarter would have been 46.3%, up 110 basis points year-over-year. We've provided additional disclosure in our earnings supplement on the contribution of performance fee-related compensation to total expense. In line with our guidance in July, we continue to expect a low teens percentage increase in 2025 core G&A expense. This year-over-year core G&A increase is mainly driven by the onboarding of GIP, Prequin, and HPS. Our capital management strategy remains consistent. We invest first in our business, either to scale strategic growth initiatives or drive operational efficiency, and then return cash to our shareholders through a combination of dividends and share repurchases. In the third quarter, we repurchased $375 million worth of shares. At present, based on our capital spending plans for the year and subject to market and other conditions, we still anticipate repurchasing at least $375 million worth of shares in the fourth quarter, consistent with our previous guidance. BlackRock's third quarter net inflows of $205 billion reflected deepening client engagement and were led by a new record flows quarters for iShares ETFs. iShares ETFs generated $153 billion of net inflows in the third quarter. Core equity and index fixed income led the way with $53 billion and $41 billion of net inflows respectively. Our digital assets EGPs raised another $17 billion in the third quarter. Our flagship offerings in IBIT and ETH were among the top five inflowing products in the ETP industry. We're also seeing demand for our high value, higher fee active ETFs, which gathered 21 billion of net inflows. Our institutional active franchise saw 22 billion of net inflows driven by the onboarding of a 30 billion Dutch pension outsourcing mandate. This inflow was partially offset by a 15 billion single client transfer from quantitative to index equity with an immaterial revenue impact. Institutional index net outflows were $14 billion inclusive of this transfer. Retail net inflows of $10 billion were led by demand for active fixed income, liquid alternatives, and apparel. Across private market strategies, we saw $13 billion of net inflows driven by strength in private credit, multi-alternatives, and infrastructure. Our work with clients spans their entire portfolios, from long-dated private markets exposures to more near-term liquidity needs. Our cash management platform recently crossed $1 trillion in AUM, with $34 billion of net inflows in the quarter. The platform has grown 45% in just the last three years. We're seeing demand across scaled money market funds, customized and tokenized liquidity products, and money market ETFs. And our partnership with Circle, as the primary manager of their cash reserves, is driving meaningful growth Our mandates surpassed $64 billion this quarter. BlackRock delivered some of the strongest organic base fee growth in recent history, and we enter the fourth quarter in an excellent position. The fourth quarter has traditionally been our strongest for organic growth. In my nearly 20 years at BlackRock, I've never been part of deeper, more far-reaching client engagements than in recent months. We believe our strategy will continue to deliver for both our clients and shareholders, resulting in market-leading organic growth differentiated operating leverage, and earnings and multiple expansion over time. With that, I'll turn it over to Larry.

Thank you, Martin, and good morning to everyone, and thanks for joining the call. Our third quarter results reflect the strength of our global relationships and the deepening trust we've earned with clients. All of the high conviction growth themes we anticipated and invested ahead of are now leading in client conversations. BlackRock is always thinking out to the future towards what our clients will need and want. ETFs, private markets, tech and data, digital assets are just a few examples. We were ahead of the game in recognizing their importance for clients, and we took leading positions. The accelerating activity we're seeing is a validation of the BlackRock business model. We nurture enduring and local client relationships, and we invest boldly. Total net inflows of $205 billion were positive across all asset classes and client types and powered 10% organic base fee growth in the quarter. That growth is even more notable in its diversification. Just looking across our top five organic base fee contributors, it's our systematic franchise. It's our private credit franchise. It's a digital asset franchise, or cash franchise, and the whole business of outsourcing portfolios and general accounts to BlackRock. BlackRock's multiple source of growth differentiates us and makes us really optimistic for the future. In April, tariff announcements shocked global markets. At the time, I traveled to several of our international offices to reinforce BlackRock's strong local mandates with each of our country managers. We bring our global expertise and tailored local insights to clients through an on-the-ground presence. That presence has strengthened our position as a trusted partner and advisor over many years, and it continues to further strengthen in 2025. Over the last 12 months, we generated 8% organic base seed growth exceeding our target each quarter. Revenues grew 20%. new AUM records. Clients have entrusted BlackRock with $1.4 trillion of net inflows over the last three years and $2.3 trillion over the last five years. When BlackRock acquired BGI and iShares, we gave investors the ability to blend active and index strategies seamlessly, something they hadn't been able to do before. Today, convergence of public and private markets is increasing. Clients are focused on strategies and solutions that work across the whole portfolio. Investors are seeking deeper, more dynamic partnerships across public and private asset classes. They're coming to BlackRock for a partner in portfolio management and in technology across a full range of capital markets. As I meet with clients around the world, they've been excited about the opportunity to do much more with BlackRock. And it's expanding the growth potential for GIP, HBS, and PreQuint. Our history of integrations is very different and it has set us apart. BlackRock's acquisition philosophy has always been about growth. What makes our acquisition so successful is our belief in full integration. Our culture strengthens and evolves as we welcome new teams and new capabilities. But we continue to operate as one BlackRock, not a collection of boutiques. We do the work to make sure we are seamlessly connected to our clients with one platform, shared goals, and a common Aladdin technology. We're organized so the clients have access to all of BlackRock in a comprehensive, consistent way. We intentionally structure the GIP HBS transactions so that the consideration was largely in BlackRock equity with long-dated performance milestones. We all have the same interests as significant shareholders alongside our broader shareholder base. Our acquired firms are becoming a part of the fabric of BlackRock and I'm proud of the successes we've seen in just these early days. Our closing of HBS just three months ago brought more than 800 colleagues to the BlackRock family. Our combined platform is becoming a first call for clients and borrowers around the world. Finance engagement is even stronger than we expected, especially in the insurance and wealth channels. We're positioned to be a preferred capital partner with insurers while maintaining our balance sheet light approach. In wealth, we brought together highly complementary capabilities that position us to be a leading player. On the investment side, our scaled franchises range from our non-traded senior bank BDC HLN to credit solutions across the capital stack. HLN continues to generate around $1 billion in net inflows a quarter. And from a distribution perspective, HBS has had strong connectivity to private banks and high network practices. Now, that is now augmented by BlackRock's extensive network across wirehouses, independents, and RIAs. Our 370 billion private financing solution platform, alongside of our over $3 trillion public fixed income franchise, positions us to be our client's strategic partner across public and private debt markets. And just a year into our closing of the GIP acquisition, we made significant progress in both fundraising and deployment. GIP5 closed above its $25 billion target in July, and it represents the largest ever client capital raise in a private infrastructure fund. Our AI partnership continues to attract significant capital interests. Market-leading global technology, energy, and financial organizations are consolidating around AIP as a partner of choice. AIP includes MGX of Abu Dhabi, Microsoft, KIA of Kuwait, and Temasek of Singapore, and technology and energy advisors in NVIDIA, XAI, Cisco, GE, Renova, Nexera Energy. Our combined relationships and expertise are coming together to advance key discussions on fantastic investment opportunities for our clients. GIP's track record in one of the largest data centers in the United States has been instrumental. There are significant opportunities for us ahead in the data center space. An estimated $1.5 trillion of capital is going to be needed in the next five years in just the core and shell of data centers, and that's not including the chips. The growth of cloud computing and AI are propelling this capital demand, and BlackRock with GIP is well positioned to expand our leadership. Teams across BlackRock are exploring how AI can play a bigger role in making markets more accessible and more efficient. We see a future commercial opportunities in using tokenization to further bridge the gap between traditional capital markets and the growing digital asset space. This is one of the most exciting areas of growth in financial markets. There's over $4.5 trillion in value sitting in digital wallets across crypto assets, stablecoin, and tokenized assets. We see this market growing significantly over the next few years. Today, there's no access to high-quality traditional investment products and digital wallets. BlackRock plans to change that. BlackRock is a foundational player in the ecosystem. We manage the largest crypto asset ETP with over $100 billion in AUM. We're the largest reserve fund manager for Stablecoin with over $60 billion in Circles Reserve Fund. And we built a tokenized liquidity fund for digital assets native investors, which is available across multiple public blockchains. Biddle has grown to nearly $3 billion in AUM. Now we're exploring tokenizing long-term investment products like iShares. We envision a future where investors never need to leave a digital wallet to allocate efficiently across crypto, stablecoin, and exposures to long-term stocks and bonds. The U.S. economy has been propelled in many parts by its leading market infrastructure. I believe the U.S. needs to accelerate regulatory clarity and investments in digital assets innovation. We need to be a leader in market infrastructure for much of the larger part of the world of digital assets. BlackRock brings technological and operational scale, client trust, and a global footprint across 100 countries. We believe all these factors put us in a prime position to be a part of a global conversation around tokenization and digital assets. We've seen through ETFs how innovation and financial technology can unlock growth by making it easier for more investors to access the capital markets. Our iShares franchise today has crossed over $5 trillion in assets during the third quarter, with record net inflows of $153 billion. Double-digit organic base seed growth was once again led by digital assets, bond ETS, and active ETS. Our digital assets and active iShares franchises are examples of how BlackRock operates as an innovation and scale engine. We build these businesses from the ground up to be a category leader in just a few years. Our digital assets, ETPs, and active ETS have grown from practically zero in 2023 to over $100 billion in digital assets and over $80 billion in active ETFs. The rapid growth of these premium categories is another proof point of our success in scaling distribution and quickly adapting to new offerings and in new markets. In Europe, the growth of the ETF market is at an inflection point. Our 2025 net inflows of 103 billion have already surpassed last year's record full year flows. We're bringing learning from our US offerings to help grow the ETF market in Europe and better serve our clients in this region. And we're planting seeds for the futures through our local investments as we facilitate the growth of capital markets and investing around the world. In India, Our Geo BlackRock joint venture recently launched its first systematic active equity offering, building on our already high-performing global systematic franchise. The Indian market remains largely untapped and is today a country of savers, rather investors. Through Geo BlackRock, we're enabling individuals to more easily invest in their local economies, in their local financial assets, and we're helping them build towards a more secure financial future. Many of our clients are investing on behalf of retirement savers, and they're turning to BlackRock to scale and modernize their retirement plans options. BlackRock continues to lead with innovation for retirement. With LifePath Paycheck, we're embedding lifetime income into plan options, and we're working to enable access to growth-oriented private market strategies in 401ks. Defined benefit pension funds, pension plans, have been investing in private markets for decades, and we believe this opportunity should also be available for U.S.-defined contribution plans. Even if a path clears for private markets in 401 s, the fiduciary standard rule still holds. Blind fiduciaries will need to carefully diligence all investments, just as they are required to do today. I think that could create an acceleration in demand for all the Aladdin products, including Prequin. Clients would need better data, better analytics on private markets to substantiate and justify their inclusion in 401 offerings, representing a large potential unlock for Aladdin and Prequin. We're already helping clients better manage private markets investments with eFront alongside Prequin performance and investment data. We recently signed our first full portfolio technology mandate encompassing Aladdin, eFront, and Prequent as a seamless public-private workflow and data solution. And we're continuing to engage with clients on opportunities to integrate these capabilities to drive greater efficiency and growth for each and every one of our clients' portfolios. I'm immensely proud of the connectivity we've seen from employees and clients alike as we fully integrate GIP, HPS, and Prequint. As we've grown our firm, we've also evolved our leadership structure to help us meet client needs and develop our talent. We recently expanded our executive team to include a group of exceptional enterprise leaders to better serve clients and advance our long-term strategies. Together, we're both defining and fulfilling the future of asset management through a truly differentiated platform, one that is anchored by public-private investment models, backed by Aladdin technology, united by a shared culture of performance and client service. I have never been more excited about the future of BlackRock, our firm, and the opportunities ahead for the entire worldwide position for BlackRock in the future.