Strategic Performance and Platform Evolution
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Achieved record quarterly fundraising of approximately $36 billion, driven by institutional demand for private credit and infrastructure, despite a slower broader transaction environment.
AUM and fee-paying AUM grew 17% year-over-year to $671 billion and $410 billion, respectively, supported by the depth of the global platform and broad-based investment capabilities.
Strategic diversification is accelerating, with approximately 70% of capital raised this year coming from outside the four largest credit fund families, spanning 90 different vehicles.
Deployment activity increased to $36 billion, a 20% sequential improvement in the forward pipeline, led by asset-based finance, secondaries, and digital infrastructure.
The wealth management channel remains a growth engine with $76 billion in AUM, though management noted a shift in redemption patterns primarily concentrated among non-U.S. family offices.
Operational leverage and investments in technology and AI are expected to drive continued margin improvement as the platform scales toward long-term growth targets.
Outlook and Strategic Initiatives
Management expects 2026 to be another record year for fundraising, supported by successor funds for the two largest fund families launching in the coming year.
Anticipate a stronger second half for deployment as sponsor dialogue improves and the ‘shadow pipeline’ of NDAs has increased approximately 35% quarter-over-quarter.
Fee-related earnings (FRE) margins are projected to approach the upper end of the 0 to 150 basis point expansion guidance for the full year.
Digital infrastructure is positioned as a significant future earnings driver, with the Ada Infrastructure platform executing on 7 large campuses representing 1 gigawatt of compute.
Strategic growth will focus on capital solutions, product extensions for mass affluent markets, and potential inorganic opportunities that meet strict cultural and financial criteria.
Risk Factors and Structural Adjustments
Redemption requests in the non-traded BDC are largely concentrated in a small number of non-U.S. investors representing approximately 10% of the vehicle’s NAV.
Management intends to implement new share classes with structural protections, such as lockups and redemption penalties, to mitigate future regional redemption volatility.
G&A expenses were impacted by approximately $9 million in the second quarter due to the biennial firm-wide institutional investor meeting.
The firm maintains a record $170 billion in dry powder, providing a buffer against market volatility and enabling opportunistic deployment.
