Profit for the firm rose as AUM climbed by 13.6% from a year ago, but revenue fell as performance fees decreased.
BlackRock’s path to $ 5 trillion began in 1988, when the firm started as a fixed-income specialist as part of The Blackstone Group in a single Park Avenue office. By 1999, when the money manager went public, it had gathered $ 165 billion in assets.
A series of canny deals in the mid to late-2000s added to its heft and its mix of businesses. The firm bought Merrill Lynch Investment Managers in 2006, a transaction that helped it expand globally and bolster its stock picking and multiasset businesses. The deal boosted BlackRock’s assets under management to about $ 1 trillion for the first time.
Then, in 2009 with $ 1.3 trillion in assets, it acquired Barclays Global Investors, gaining a large exchange-traded fund business that helped it turn iShares into the world’s largest ETF business. Assets under management more than doubled to more than $ 2.7 trillion as a result of the deal.
Since then, the firm has worked to grow that passive-investing unit, gather assets globally, bolster its alternatives platform and gain more retail assets. It passed the $ 4 trillion mark in late 2013.
During the quarter, the New York firm reported $ 55 billion in long-term net inflows during the September quarter with inflows coming across asset classes.
The inflows and positive market performance helped boost assets under management.
The firm reported that equity offerings lead grow in its iShares products, leading to $ 51.3 billion of long term net iShares inflows. In the iShares division, which makes up about a quarter of BlackRock’s assets under management, the firm offers exchange-traded funds, or securities that trade on an exchange and typically track an index or other basket of assets.
Even as BlackRock has worked to woo and retain retail clients, those clients pulled a net $ 2.2 billion from the firm in the quarter.
In all, BlackRock reported a profit of $ 875 million, up from $ 843 million a year prior. Per-share earnings grew to $ 5.26 from $ 5.00. Excluding certain items, BlackRock earned $ 5.14 a share, up from $ 5.00 a year earlier.
Revenue fell 2.5% to $ 2.84 billion.
Analysts had projected $ 5.00 a share in adjusted earnings on $ 2.88 billion in revenue, according to Thomson Reuters.
BlackRock shares, down 0.9% in the last three months, were inactive in premarket trading.
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This article was published by The Wall Street Journal