Larry Fink, chair and CEO of BlackRock
BlackRock reported having $10 trillion in assets under management at the end of the fourth quarter 2023, up nearly 10% from the previous quarter and 16% year over year.
It is the second time BlackRock has cracked $10 trillion in assets, though the total AUM was just shy of the firm's record-high AUM in the fourth quarter of 2021.
In a statement released Jan. 12, BlackRock reported $96 billion in net inflows in the fourth quarter, bringing the full year net inflows to $289 billion. BlackRock's clients added a net $62.7 billion to long-term products last quarter, and put nearly $33 billion in cash management.
In his note to investors, BlackRock's CEO and chairman Larry Fink lauded his firm's ability to grow despite "historically challenging market and industry conditions" over the last two years, adding when investors were "ready to put money back to work, they did it with BlackRock."
By client type, institutional saw $16 billion in outflows as clients added $7.5 billion to active strategies but pulled $23.6 billion from index funds. Retail clients withdrew nearly $9 billion. ETFs saw a whopping $87.7 billion in net inflows.
The firm also announced its acquisition of private equity firm Global Infrastructure Partners, for which it has agreed to pay $3 billion in cash and 12 million shares of BlackRock common stock. The deal is worth about $12.5 billion, based on BlackRock's share price at the Jan. 11 close. It is BlackRock's second-biggest acquisition in its history, behind its $13.5 billion acquisition of Barclays Global Investors in 2009.
"The combination of BlackRock infrastructure with GIP will make us the second largest private markets infrastructure manager with over $150 billion in total AUM, providing clients — especially those saving for retirement — with the high-coupon, inflation-protected, long-duration investments they need," said Fink in his statement. "We are incredibly excited about this next chapter in BlackRock's history."
The deal is expected to complete in the third quarter this year.
During the company's earnings call on Jan. 12, CFO Martin Small acknowledged the layoffs earlier this week, which impacted approximately 600 employees representing 3% of BlackRock's staff.
Small called the layoffs a "resourcing decision to free up investment capacity for our most important growth initiatives," as the firm prioritizes investments that will "propel our differentiated organic growth."
The layoffs were the third round for BlackRock in the past 12 months.
The firm's headcount will remain "broadly flat" in 2024, Small said. In the company's announcement of the layoffs earlier this week, Fink and President Rob Kapito said that the firm would end the year with a higher headcount than it began with.
