BlackRock, Inc. Q1 2026 10-Q Summary
Business Context and Reporting Period
This filing is a Quarterly Report on Form 10-Q for BlackRock, Inc. for the period ended March 31, 2026. BlackRock is a leading publicly traded investment management firm with $13.9 trillion in Assets Under Management (AUM) as of the period end. The company operates as a single asset management segment, providing investment management and technology services (including the Aladdin platform) to institutional and retail clients globally.
Key Financial Metrics
| Metric | Q1 2026 | Q1 2025 |
|---|---|---|
| Total Revenue | $6,698 million | $5,276 million |
| Operating Income | $2,814 million | $1,698 million |
| Operating Margin | 42.0% | 32.2% |
| Net Income (GAAP) | $2,326 million | $1,515 million |
| Net Income Attributable to BlackRock | $2,212 million | $1,510 million |
| Diluted EPS | $14.06 | $9.64 |
| Cash and Cash Equivalents | $9,841 million | $11,468 million |
| Total Borrowings | $12,749 million | $12,768 million |
Material Changes vs. Prior Period
- Revenue Growth: Total revenue increased 27% year-over-year, driven by organic base fee growth, positive market impacts, fees from the HPS Investment Partners acquisition, and higher technology services revenue.
- Performance Fees: Investment advisory performance fees surged to $272 million from $60 million in Q1 2025, primarily due to private markets performance.
- Expense Dynamics: Total expenses rose 9% to $3.88 billion. This increase was significantly influenced by noncash acquisition-related items, including a $549 million gain from the change in fair value of contingent consideration (reducing expenses) and $277 million in amortization of intangible assets.
- AUM Fluctuation: AUM decreased $147 billion to $13.9 trillion from the prior quarter end, driven by net market depreciation ($216 billion) and foreign exchange impacts ($50 billion), partially offset by net inflows of $130 billion.
Guidance, Outlook, and Risks
Management Commentary: Management highlighted strong organic growth and the successful integration of the HPS Transaction. The "As Adjusted" operating margin was 44.5%, reflecting the company's ability to manage ongoing costs relative to revenue. The company continues to execute on its share repurchase program, having repurchased approximately $450 million of shares in Q1 2026.
Risks and Contingencies:
- Legal Proceedings: BlackRock is defending a lawsuit filed by thirteen state Attorneys General alleging antitrust violations regarding coal supply. Management does not currently anticipate a material effect on operations but notes uncertainty regarding potential losses.
- Market Risk: A significant portion of revenue is tied to AUM, exposing the firm to equity market price risk, interest rate risk, and foreign exchange volatility.
- Contingent Consideration: The company has $7.9 billion in contingent consideration liabilities related to the GIP and HPS transactions, which are sensitive to stock price performance and fundraising milestones.
Investor Verification Checklist
- Acquisition Impact: Verify the specific contribution of the HPS Transaction to Q1 revenue and the timeline for full integration benefits.
- Non-GAAP Reconciliations: Review the reconciliation of GAAP to "As Adjusted" metrics, specifically the treatment of the $549 million contingent consideration gain and amortization expenses.
- AUM Drivers: Analyze the breakdown of net inflows vs. market depreciation to understand the sustainability of fee revenue given the $216 billion market decline in the quarter.
- Contingent Liabilities: Assess the sensitivity of the $7.9 billion contingent consideration liability to future stock price movements and performance targets.
- Liquidity Position: Confirm the availability of the $6.3 billion revolving credit facility and the company's ability to fund operations and dividends despite the decrease in cash balances.