Blackstone beats earnings estimates, CEO foresees broad-based acceleration

Blackstone Inc., the world’s leading alternative asset manager, reported stellar third-quarter results for fiscal year 2024-2025, exceeding Wall Street’s expectations and driving its stock up 7%. The firm posted distributable earnings (DE) of $1.01 per share, higher than the anticipated $0.91. CEO Stephen Schwarzman highlighted a “broad-based acceleration” across Blackstone’s business segments, from private equity to real estate, as key drivers of this growth. Schwarzman noted that the company achieved the highest level of overall fund appreciation in three years, with assets under management (AUM) soaring to a record $1.1 trillion.

Growth across all segments

Blackstone’s success is underpinned by a strong resurgence across its major investment verticals. Private equity, real estate, and credit markets have all contributed to the firm’s exceptional performance. Schwarzman pointed to a notable uptick in global demand for alternative assets, which has played a crucial role in the growth of Blackstone’s AUM by 10% year-over-year. The company also saw significant inflows of $40.5 billion during the quarter, signalling robust investor confidence in Blackstone’s diversified strategy.

While fee-related earnings in the real estate segment dipped by 8%, other areas such as credit and insurance saw a 25% rise. Private equity grew by 9%, showcasing the firm’s ability to adapt and capitalize on fluctuating market conditions. Schwarzman stated that Blackstone had invested or committed $54 billion in the quarter, the highest amount in over two years, a sign of renewed confidence in capital markets as interest rate pressures ease.

Investor sentiment and stock impact

Following the earnings announcement, Blackstone’s stock price surged by 7%, reflecting positive investor sentiment towards the firm’s continued momentum. Analysts are optimistic that Blackstone will maintain its upward trajectory, particularly as macroeconomic conditions stabilize. The firm’s dividend, set at $0.86 per share for November 2024, further underlines its strong cash position and commitment to returning value to shareholders.

Despite challenges in real estate, Blackstone’s performance in credit and insurance, as well as its private equity gains, reflect a robust and balanced portfolio. With $1.9 billion in buyback authorization still available, the company has demonstrated a solid capital allocation strategy that appeals to investors.

Expert opinion

Financial experts agree that Blackstone’s diverse portfolio positions it as a resilient player in the alternative asset management industry. Industry analysts expect continued growth in the coming quarters, driven by improved deal-making activity and sustained global demand for alternative investments. Schwarzman’s strategy of deploying significant capital during periods of economic uncertainty has proven highly effective, placing Blackstone in a strong position to weather any future market fluctuations.