By Prakhar Srivastava and Lewis Krauskopf
Jan 15 (Reuters) – BlackRock’s fourth-quarter profit surged past Wall Street estimates on Thursday while a rally in markets boosted fee income and lifted the company’s assets under management to a record $14 trillion.
Shares of the world’s largest asset manager, which also hiked its quarterly dividend by 10% and raised its share buyback authorization, jumped more than 4% on Thursday.
U.S. stocks rallied last year on enthusiasm around artificial intelligence, easing interest rates and steady economic growth, prompting investors to pour money back into lower-cost index strategies. As inflation eased and the job market cooled, the Federal Reserve turned more dovish, driving strong inflows into BlackRock’s fixed-income products.
Equity product inflow was $126.05 billion, down slightly from a year ago, while fixed-income products saw inflows of $83.77 billion in the quarter.
Long-term net inflows totaled about $267.8 billion, led by continued strength in its ETF business, the firm’s main engine of organic growth. BlackRock posted a record $698.3 billion of full-year net inflows.
ETFs are increasingly popular with investors seeking low-cost, diversified exposure across markets.
The company’s performance fees rose 67% to $754 million in the reported period, reflecting higher revenue from private markets.
“BlackRock enters 2026 with accelerating momentum across our entire platform, coming off the strongest year and quarter of net inflows in our history,” BlackRock CEO Larry Fink said in a statement.
BlackRock shares rose just 4.4% in 2025, trailing the benchmark S&P 500 index.
PRIVATE MARKET PLAY
Asset managers have been working to diversify revenue by expanding into higher fee-paying business rather than low-cost index products.
BlackRock has been leaning more heavily into private markets, real estate and infrastructure, with a particular focus on AI-linked assets such as data centers and power infrastructure. The AI push is designed to tap larger, longer-term pools of capital and build more stable, higher-margin revenue streams beyond traditional public markets.
Its private markets business drew inflows of $12.7 billion in the quarter. BlackRock is targeting $400 billion of cumulative fundraising in private markets by 2030. As part of this effort, it unveiled plans to include private assets in its retirement plans.
Private assets generate significantly higher fees than exchange-traded funds, a core part of BlackRock’s business through its iShares franchise.
Excluding some one-time charges, net profit jumped to $2.18 billion, or $13.16 per share, for the three months ended December 31, up from $1.87 billion, or $11.93 per share, a year earlier. Analysts on average were expecting a profit of $12.21 per share, according to data compiled by LSEG.
BlackRock’s assets under management rose to $14.04 trillion in the quarter, up from $11.55 trillion a year earlier.
Total revenue – most of which is earned as a percentage of assets under management – rose to $7 billion from $5.68 billion a year ago, exceeded analysts’ expectations of $6.69 billion.
BlackRock’s total expenses rose to $5.35 billion from $3.6 billion last year.
(Reporting by Prakhar Srivastava in Bengaluru and Lewis Krauskopf in New York; Editing by Devika Syamnath and Nick Zieminski)
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