(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

As of ~~April 30,~~October 31, 2020, there were ~~154,262,173~~152,510,707 shares of the registrant’s common stock outstanding.

	March 31,			December 31,			September 30,			December 31,
(in millions, except shares and per share data)	2020			2019			2020			2019
Assets
Cash and cash equivalents⁽¹⁾	$	4,406		$	4,829		$	6,507		$	4,829
Accounts receivable		3,095			3,179			3,706			3,179
Investments⁽¹⁾		5,240			5,489			6,307			5,489
Separate account assets		83,262			102,844			95,994			102,844
Separate account collateral held under securities lending agreements		14,777			15,466			15,137			15,466
Property and equipment (net of accumulated depreciation of $923 and $880 at March 31, 2020 and December 31, 2019, respectively)		714			715
Intangible assets (net of accumulated amortization of $210 and $185 at March 31, 2020 and December 31, 2019, respectively)		18,344			18,369
Property and equipment (net of accumulated depreciation of $1,040 and $880 at September 30, 2020 and December 31, 2019, respectively)								693			715
Intangible assets (net of accumulated amortization of $264 and $185 at September 30, 2020 and December 31, 2019, respectively)								18,290			18,369
Goodwill		14,559			14,562			14,554			14,562
Other assets⁽¹⁾		4,623			3,169			3,930			3,169
Total assets	$	149,020		$	168,622		$	165,118		$	168,622
Liabilities
Accrued compensation and benefits	$	858		$	2,057		$	1,847		$	2,057
Accounts payable and accrued liabilities		982			1,167			988			1,167
Borrowings		5,933			4,955			7,227			4,955
Separate account liabilities		83,262			102,844			95,994			102,844
Separate account collateral liabilities under securities lending agreements		14,777			15,466			15,137			15,466
Deferred income tax liabilities		3,610			3,734			3,742			3,734
Other liabilities⁽¹⁾		5,088			3,470			4,167			3,470
Total liabilities		114,510			133,693			129,102			133,693
Commitments and contingencies (Note 15)
Temporary equity
Redeemable noncontrolling interests		1,440			1,316			2,084			1,316
Permanent Equity
BlackRock, Inc. stockholders’ equity
Common stock, $0.01 par value;		2			2			2			2
Shares authorized: 500,000,000 at March 31, 2020 and December 31, 2019; Shares issued: 171,252,185 at March 31, 2020 and December 31, 2019; Shares outstanding: 154,262,618 and 154,375,780 at March 31, 2020 and December 31, 2019, respectively
Shares authorized: 500,000,000 at September 30, 2020 and December 31, 2019; Shares issued: 172,075,373 and 171,252,185 at September 30, 2020 and December 31, 2019, respectively; Shares outstanding: 152,496,403 and 154,375,780 at September 30, 2020 and December 31, 2019, respectively
Preferred stock (Note 20)		—			—			0			0
Additional paid-in capital		18,885			19,186			19,150			19,186
Retained earnings		21,872			21,662			23,340			21,662
Accumulated other comprehensive loss		(810	)		(571	)		(601	)		(571	)
Treasury stock, common, at cost (16,989,567 and 16,876,405 shares held at March 31, 2020 and December 31, 2019, respectively)		(6,936	)		(6,732	)
Treasury stock, common, at cost (19,578,970 and 16,876,405 shares held at September 30, 2020 and December 31, 2019, respectively)								(8,018	)		(6,732	)
Total BlackRock, Inc. stockholders’ equity		33,013			33,547			33,873			33,547
Nonredeemable noncontrolling interests		57			66			59			66
Total permanent equity		33,070			33,613			33,932			33,613
Total liabilities, temporary equity and permanent equity	$	149,020		$	168,622		$	165,118		$	168,622

	Three Months Ended						Three Months Ended						Nine Months Ended
	March 31,						September 30,						September 30,
(in millions, except shares and per share data)	2020			2019			2020			2019			2020			2019
Revenue
Investment advisory, administration fees and securities lending revenue
Related parties	$	2,175		$	1,989		$	2,329		$	2,105		$	6,556		$	6,155
Other third parties		880			816			896			875			2,690			2,533
Total investment advisory, administration fees and securities lending revenue		3,055			2,805			3,225			2,980			9,246			8,688
Investment advisory performance fees		41			26			532			121			685			211
Technology services revenue		274			204			282			259			834			700
Distribution fees		276			262			288			270			817			799
Advisory and other revenue		64			49			42			62			145			164
Total revenue		3,710			3,346			4,369			3,692			11,727			10,562
Expense
Employee compensation and benefits		1,137			1,064			1,411			1,111			3,700			3,258
Distribution and servicing costs		445			404			456			427			1,330			1,247
Direct fund expense		277			242			257			239			780			733
General and administration		1,142			388			461			385			1,991			1,243
Amortization of intangible assets		25			15			27			28			79			68
Total expense		3,026			2,113			2,612			2,190			7,880			6,549
Operating income		684			1,233			1,757			1,502			3,847			4,013
Nonoperating income (expense)
Net gain (loss) on investments		(40	)		142			269			(7	)		627			224
Interest and dividend income		15			29			9			19			34			68
Interest expense		(46	)		(46	)		(54	)		(54	)		(151	)		(152	)
Total nonoperating income (expense)		(71	)		125			224			(42	)		510			140
Income before income taxes		613			1,358			1,981			1,460			4,357			4,153
Income tax expense (benefit)		(14	)		298			464			341			811			961
Net income		627			1,060			1,517			1,119			3,546			3,192
Less:
Net income (loss) attributable to noncontrolling interests		(179	)		7			153			—			162			17
Net income attributable to BlackRock, Inc.	$	806		$	1,053		$	1,364		$	1,119		$	3,384		$	3,175
Earnings per share attributable to BlackRock, Inc. common stockholders:
Basic	$	5.19		$	6.65		$	8.94		$	7.21		$	22.00		$	20.31
Diluted	$	5.15		$	6.61		$	8.87		$	7.15		$	21.84		$	20.17
Weighted-average common shares outstanding:
Basic		155,243,279			158,268,034			152,488,073			155,280,877			153,816,544			156,290,212
Diluted		156,416,726			159,348,431			153,742,264			156,447,387			154,959,812			157,385,956

	Three Months Ended					Three Months Ended					Nine Months Ended
	March 31,					September 30,					September 30,
(in millions)	2020			2019		2020		2019			2020			2019
Net income	$	627		$	1,060	$	1,517	$	1,119		$	3,546		$	3,192
Other comprehensive income (loss):
Foreign currency translation adjustments⁽¹⁾		(239	)		68		180		(120	)		(30	)		(93	)
Comprehensive income (loss)		388			1,128		1,697		999			3,516			3,099
Less: Comprehensive income (loss) attributable to noncontrolling interests		(179	)		7		153		-			162			17
Comprehensive income attributable to BlackRock, Inc.	$	567		$	1,121	$	1,544	$	999		$	3,354		$	3,082

(in millions)	Additional Paid-in Capital⁽¹⁾			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock Common			Total BlackRock Stockholders’ Equity			Nonredeemable Noncontrolling Interests			Total Permanent Equity			Redeemable Noncontrolling Interests / Temporary Equity			Additional Paid-in Capital⁽¹⁾			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock Common			Total BlackRock Stockholders’ Equity			Nonredeemable Noncontrolling Interests			Total Permanent Equity			Redeemable Noncontrolling Interests / Temporary Equity
December 31, 2019	$	19,188		$	21,662		$	(571	)	$	(6,732	)	$	33,547		$	66		$	33,613		$	1,316		$	19,188		$	21,662		$	(571	)	$	(6,732	)	$	33,547		$	66		$	33,613		$	1,316
Net income		—			806			—			—			806			—			806			(179	)		—			3,384			—			—			3,384			(2	)		3,382			164
Dividends declared ($3.63 per share)		—			(596	)		—			—			(596	)		—			(596	)		—
Dividends declared ($10.89 per share)																										—			(1,706	)		—			—			(1,706	)		—			(1,706	)		—
Stock-based compensation		149			—			—			—			149			—			149			—			458			—			—			—			458			—			458			—
Issuance of common shares related to employee stock transactions		(450	)		—			—			453			3			—			3			—			(494	)		—			—			506			12			—			12			—
Employee tax withholdings related to employee stock transactions		—			—			—			(257	)		(257	)		—			(257	)		—			—			—			—			(280	)		(280	)		—			(280	)		—
Shares repurchased		—			—			—			(400	)		(400	)		—			(400	)		—			—			—			—			(1,512	)		(1,512	)		—			(1,512	)		—
Subscriptions (redemptions/distributions) — noncontrolling interest holders		—			—			—			—			—			(9	)		(9	)		871			—			—			—			—			—			(5	)		(5	)		1,363
Net consolidations (deconsolidations) of sponsored investment funds		—			—			—			—			—			—			—			(568	)		—			—			—			—			—			—			—			(759	)
Other comprehensive income (loss)		—			—			(239	)		—			(239	)		—			(239	)		—			—			—			(30	)		—			(30	)		—			(30	)		—
March 31, 2020	$	18,887		$	21,872		$	(810	)	$	(6,936	)	$	33,013		$	57		$	33,070		$	1,440
September 30, 2020																									$	19,152		$	23,340		$	(601	)	$	(8,018	)	$	33,873		$	59		$	33,932		$	2,084

(in millions)	Additional Paid-in Capital⁽¹⁾			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock Common			Total BlackRock Stockholders’ Equity			Nonredeemable Noncontrolling Interests			Total Permanent Equity			Redeemable Noncontrolling Interests / Temporary Equity
June 30, 2020	$	19,009		$	22,532		$	(781	)	$	(8,030	)	$	32,730		$	56		$	32,786		$	1,248
Net income		—			1,364			—			—			1,364			(2	)		1,362			155
Dividends declared ($3.63 per share)		—			(556	)		—			—			(556	)		—			(556	)		—
Stock-based compensation		160			—			—			—			160			—			160			—
Issuance of common shares related to employee stock transactions		(17	)		—			—			22			5			—			5			—
Employee tax withholdings related to employee stock transactions		—			—			—			(10	)		(10	)		—			(10	)		—
Shares repurchased		—			—			—			—			—			—			—			—
Subscriptions (redemptions/distributions) — noncontrolling interest holders		—			—			—			—			—			5			5			548
Net consolidations (deconsolidations) of sponsored investment funds		—			—			—			—			—			—			—			133
Other comprehensive income (loss)		—			—			180			—			180			—			180			—
September 30, 2020	$	19,152		$	23,340		$	(601	)	$	(8,018	)	$	33,873		$	59		$	33,932		$	2,084

(in millions)	Additional Paid-in Capital⁽¹⁾			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock Common			Total BlackRock Stockholders’ Equity			Nonredeemable Noncontrolling Interests			Total Permanent Equity			Redeemable Noncontrolling Interests / Temporary Equity			Additional Paid-in Capital⁽¹⁾			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock Common			Total BlackRock Stockholders’ Equity			Nonredeemable Noncontrolling Interests		Total Permanent Equity			Redeemable Noncontrolling Interests / Temporary Equity
December 31, 2018	$	19,170		$	19,282		$	(691	)	$	(5,387	)	$	32,374		$	59		$	32,433		$	1,107		$	19,170		$	19,282		$	(691	)	$	(5,387	)	$	32,374		$	59	$	32,433		$	1,107
Net income		—			1,053			—			—			1,053			—			1,053			7			—			3,175			—			—			3,175			—		3,175			17
Dividends declared ($3.30 per share)		—			(556	)		—			—			(556	)		—			(556	)		—
Dividends declared ($9.90 per share)																										—			(1,584	)		—			—			(1,584	)		—		(1,584	)		—
Stock-based compensation		154			—			—			—			154			—			154			—			427			—			—			—			427			—		427			—
PNC preferred stock capital contribution		60			—			—			—			60			—			60			—			60			—			—			—			60			—		60			—
Retirement of preferred stock		(60	)		—			—			—			(60	)		—			(60	)		—			(60	)		—			—			—			(60	)		—		(60	)		—
Issuance of common shares related to employee stock transactions		(495	)		—			—			499			4			—			4			—			(537	)		—			—			549			12			—		12			—
Employee tax withholdings related to employee stock transactions		—			—			—			(222	)		(222	)		—			(222	)		—			—			—			—			(238	)		(238	)		—		(238	)		—
Shares repurchased		—			—			—			(1,566	)		(1,566	)		—			(1,566	)		—			—			—			—			(1,666	)		(1,666	)		—		(1,666	)		—
Subscriptions (redemptions/distributions) — noncontrolling interest holders		—			—			—			—			—			(5	)		(5	)		200			—			—			—			—			—			1		1			906
Net consolidations (deconsolidations) of sponsored investment funds		—			—			—			—			—			(1	)		(1	)		(305	)		—			—			—			—			—			—		—			(893	)
Other comprehensive income (loss)		—			—			68			—			68			—			68			—			—			—			(93	)		—			(93	)		—		(93	)		—
March 31, 2019	$	18,829		$	19,779		$	(623	)	$	(6,676	)	$	31,309		$	53		$	31,362		$	1,009
September 30, 2019																									$	19,060		$	20,873		$	(784	)	$	(6,742	)	$	32,407		$	60	$	32,467		$	1,137

(in millions)	Additional Paid-in Capital⁽¹⁾			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock Common			Total BlackRock Stockholders’ Equity			Nonredeemable Noncontrolling Interests		Total Permanent Equity			Redeemable Noncontrolling Interests / Temporary Equity
June 30, 2019	$	18,949		$	20,267		$	(664	)	$	(6,659	)	$	31,893		$	57	$	31,950		$	710
Net income		—			1,119			—			—			1,119			—		1,119			—
Dividends declared ($3.30 per share)		—			(513	)		—			—			(513	)		—		(513	)		—
Stock-based compensation		133			—			—			—			133			—		133			—
Issuance of common shares related to employee stock transactions		(22	)		—			—			26			4			—		4			—
Employee tax withholdings related to employee stock transactions		—			—			—			(9	)		(9	)		—		(9	)		—
Shares repurchased		—			—			—			(100	)		(100	)		—		(100	)		—
Subscriptions (redemptions/distributions) — noncontrolling interest holders		—			—			—			—			—			—		—			463
Net consolidations (deconsolidations) of sponsored investment funds		—			—			—			—			—			3		3			(36	)
Other comprehensive income (loss)		—			—			(120	)		—			(120	)		—		(120	)		—
September 30, 2019	$	19,060		$	20,873		$	(784	)	$	(6,742	)	$	32,407		$	60	$	32,467		$	1,137

	Three Months Ended						Nine Months Ended
(in millions)	March 31,						September 30,
	2020			2019			2020			2019
Operating activities
Net income	$	627		$	1,060		$	3,546		$	3,192
Adjustments to reconcile net income to net cash provided by/(used in) operating activities:
Depreciation and amortization		111			89			342			294
Stock-based compensation		149			154			458			427
Deferred income tax expense (benefit)		(133	)		88			20			45
Charitable Contribution		589			—			589			—
Gain related to the Charitable Contribution		(122	)		—			(122	)		—
Gain related to iCapital recapitalization		(244	)		—			(244	)		—
Other gains								—			(30	)
Net (gains) losses within consolidated sponsored investment products		391			(122	)		(161	)		(160	)
Net (purchases) proceeds within consolidated sponsored investment products		(860	)		(220	)		(1,603	)		(1,106	)
(Earnings) losses from equity method investees		40			(24	)		(75	)		(89	)
Distributions of earnings from equity method investees		13			14			25			29
Changes in operating assets and liabilities:
Accounts receivable		(5	)		(99	)		(544	)		(330	)
Investments, trading		132			(7	)		153			17
Other assets		(1,669	)		(7	)		(864	)		(225	)
Accrued compensation and benefits		(1,222	)		(1,254	)		(206	)		(525	)
Accounts payable and accrued liabilities		(214	)		(56	)		(183	)		(61	)
Other liabilities		1,479			159			633			150
Net cash provided by/(used in) operating activities		(938	)		(225	)		1,764			1,628
Investing activities
Purchases of investments		(45	)		(48	)		(252	)		(572	)
Proceeds from sales and maturities of investments		17			27			133			151
Distributions of capital from equity method investees		61			7			124			80
Net consolidations (deconsolidations) of sponsored investment funds		(15	)		(46	)		(42	)		(96	)
Acquisitions, net of cash acquired								—			(1,510	)
Purchases of property and equipment		(52	)		(58	)		(140	)		(160	)
Net cash provided by/(used in) investing activities		(34	)		(118	)		(177	)		(2,107	)
Financing activities
Proceeds from long-term borrowings		999			—			2,245			992
Cash dividends paid		(596	)		(556	)		(1,706	)		(1,584	)
Repurchases of common stock		(657	)		(1,788	)		(1,792	)		(1,904	)
Net proceeds from (repayments of) borrowings by consolidated sponsored investment products		22			50			38			102
Net (redemptions/distributions paid)/subscriptions received from noncontrolling interest holders		862			195			1,358			907
Other financing activities		(2	)		(13	)		(37	)		118
Net cash provided by/(used in) financing activities		628			(2,112	)		106			(1,369	)
Effect of exchange rate changes on cash, cash equivalents and restricted cash		(79	)		28			(15	)		(33	)
Net increase/(decrease) in cash, cash equivalents and restricted cash		(423	)		(2,427	)		1,678			(1,881	)
Cash, cash equivalents and restricted cash, beginning of period		4,846			6,505			4,846			6,505
Cash, cash equivalents and restricted cash, end of period	$	4,423		$	4,078		$	6,524		$	4,624
Supplemental disclosure of cash flow information:
Cash paid for:
Interest	$	29		$	29
Income taxes (net of refunds)	$	476		$	179
Supplemental schedule of noncash investing and financing transactions:
Issuance of common stock	$	450		$	495		$	494		$	537
PNC preferred stock capital contribution	$	—		$	60		$	—		$	60
Charitable Contribution of an investment	$	(589	)	$	—		$	(589	)	$	—
Increase (decrease) in noncontrolling interests due to net consolidation (deconsolidation) of sponsored investment funds	$	(568	)	$	(306	)	$	(759	)	$	(893	)

BlackRock’s diverse platform of alpha-seeking active, index and cash management investment strategies across asset classes enables the Company to tailor investment outcomes and asset allocation solutions for clients. Product offerings include single- and multi-asset portfolios investing in equities, fixed income, alternatives and money market instruments. Products are offered directly and through intermediaries in a variety of vehicles, including open-end and closed-end mutual funds, iShares^® exchange-traded funds (“ETFs”), separate accounts, collective ~~investment trusts~~trust funds (“CTFs”) and other pooled investment vehicles. BlackRock also offers technology services, including the investment and risk management technology platform, Aladdin^®, Aladdin Wealth, eFront, Cachematrix and FutureAdvisor, as well as advisory services and solutions to a broad base of institutional and wealth management clients.

At March 31, 2020, The PNC Financial Services Group, Inc. (“PNC”) held 22.0% of the Company’s voting common stock and 22.4% of the Company’s capital stock, which includes outstanding common and nonvoting preferred stock.

These condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and include the accounts of the Company and its controlled subsidiaries. Noncontrolling interests (“NCI”) on the condensed consolidated statements of financial condition represents the portion of consolidated sponsored investment funds in which the Company does not have direct equity ownership. Accounts and transactions between consolidated entities have been eliminated.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting periods. Actual results could differ from those estimates.

Certain financial information that normally is included in annual financial statements, including certain financial statement footnotes, is not required for interim reporting purposes and has been condensed or omitted herein. These condensed consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements and notes related thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019, which was filed with the Securities and Exchange Commission (“SEC”) on February 28, 2020 (“2019 Form 10-K”).

The interim financial information at ~~March 31,~~September 30, 2020 and for the three and nine months ended ~~March 31,~~September 30, 2020 and 2019 is unaudited. However, in the opinion of management, the interim information includes all normal recurring adjustments necessary for the fair presentation of the Company’s results for the periods presented. The results of operations for interim periods are not necessarily indicative of results to be expected for the full year.

Certain prior period presentations and disclosures, while not required to be recast, were reclassified to ensure comparability with current period classifications.

Accounting Pronouncements Adopted in the ~~Three~~Nine Months Ended ~~March 31,~~September 30, 2020

Measurement of Credit Losses. In June 2016, the Financial Accounting Standards Board issued Accounting Standards Update (“ASU”) 2016-13, Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), which significantly changes the accounting and disclosures for credit losses for most financial assets. The new guidance requires an estimate of expected lifetime credit losses and eliminates the existing recognition thresholds under current models. The adoption of ASU 2016-13, which was effective for the Company on January 1, 2020, did not have a material impact on its condensed consolidated financial statements.

Hierarchy of Fair Value Inputs. The Company uses a fair value hierarchy that prioritizes inputs to valuation approaches used to measure fair value. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. Assets and liabilities measured and reported at fair value are classified and disclosed in one of the following categories:

Quoted prices (unadjusted) in active markets for identical assets or liabilities at the reporting date.

Quoted prices for similar assets or liabilities in active markets; quoted prices for identical or similar assets or liabilities that are not active; quotes from pricing services or brokers for which the Company can determine that orderly transactions took place at the quoted price or that the inputs used to arrive at the price are observable; and inputs other than quoted prices that are observable, such as models or other valuation methodologies.

Unobservable inputs for the valuation of the asset or liability, which may include nonbinding broker quotes. Level 3 assets include investments for which there is little, if any, market activity. These inputs require significant management judgment or estimation.

Significance of Inputs. The Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the financial instrument.

Valuation Approaches. The fair values of certain Level 3 assets and liabilities were determined using various valuation approaches as appropriate, including third-party pricing vendors, broker quotes and market and income approaches.

A significant number of inputs used to value equity, debt securities, investments in CLOs and bank loans is sourced from third-party pricing vendors. Generally, prices obtained from pricing vendors are categorized as Level 1 inputs for identical securities traded in active markets and as Level 2 for other similar securities if the vendor uses observable inputs in determining the price.

In addition, quotes obtained from brokers generally are nonbinding and categorized as Level 3 inputs. However, if the Company is able to determine that market participants have transacted for the asset in an orderly manner near the quoted price or if the Company can determine that the inputs used by the broker are observable, the quote is classified as a Level 2 input.

Investments Measured at Net Asset Values. As a practical expedient, the Company uses net asset value (“NAV”) as the fair value for certain investments. The inputs to value these investments may include the Company’s capital accounts for its partnership interests in various alternative investments, including hedge funds, real assets and private equity funds, which may be adjusted by using the returns of certain market indices. The various partnerships generally are investment companies, which record their underlying investments at fair value based on fair value policies established by management of the underlying fund. Fair value policies at the underlying fund generally require the fund to utilize pricing/valuation information from third-party sources, including independent appraisals. However, in some instances, current valuation information for illiquid securities or securities in markets that are not active may not be available from any third-party source or fund management may conclude that the valuations that are available from third-party sources are not reliable. In these instances, fund management may perform model-based analytical valuations that could be used as an input to value these investments.

Fair Value Assets and Liabilities of Consolidated CLO. The Company applies the fair value option provisions for eligible assets, including bank loans, held by a consolidated CLO. As the fair value of the financial assets of the consolidated CLO is more observable than the fair value of the borrowings of the consolidated CLO, the Company measures the fair value of the borrowings of the consolidated CLO asequal to the fair value of the assets of the consolidated CLO less the fair value of the Company’s economic interest in the CLO.

Derivatives and Hedging Activities. The Company does not use derivative financial instruments for trading or speculative purposes. The Company uses derivative financial instruments primarily for purposes of hedging exposures to fluctuations in foreign currency exchange rates of certain assets and liabilities, and market exposures for certain seed investments. However, certain consolidated sponsored investment funds may also utilize derivatives as a part of their investment strategy.

The Company records all derivative financial instruments as either assets or liabilities at fair value on a gross basis in the condensed consolidated statements of financial condition. Changes in the fair value of the Company’s derivative financial instruments are recognized in earnings and, where applicable, are offset by the corresponding gain or loss on the related foreign-denominated assets or liabilities or hedged investments, on the condensed consolidated statements of income.

The Company may also use financial instruments designated as net investment hedges for accounting purposes to hedge net investments in international subsidiaries whose functional currency is not US dollars. The gain or loss from revaluing ~~accounting~~net investment hedges ~~of net investments in foreign operations~~ at the spot rate is deferred and reported within accumulated other comprehensive income (loss) on the condensed consolidated statements of financial condition. Amounts excluded from the effectiveness assessment are reported in the condensed consolidated statements of income using a systematic and rational method. The Company reassesses the effectiveness of its net investment hedge at least quarterly.

Separate Account Assets and Liabilities. Separate account assets are maintained by BlackRock Life Limited, a wholly owned subsidiary of the Company, which is a registered life insurance company in the United Kingdom, and represent segregated assets held for purposes of funding individual and group pension contracts. The life insurance company does not underwrite any insurance contracts that involve any insurance risk transfer from the insured to the life insurance company. The separate account assets primarily include equity securities, debt securities, money market funds and derivatives. The separate account assets are not subject to general claims of the creditors of BlackRock. These separate account assets and the related equal and offsetting liabilities are recorded as separate account assets and separate account liabilities on the condensed consolidated statements of financial condition.

The net investment income attributable to separate account assets supporting individual and group pension contracts accrues directly to the contract owner and is not reported on the condensed consolidated statements of income. While BlackRock has no economic interest in these separate account assets and liabilities, BlackRock earns policy administration and management fees associated with these products, which are included in investment advisory, administration fees and securities lending revenue on the condensed consolidated statements of income.

Separate Account Collateral Assets Held and Liabilities Under Securities Lending Agreements. The Company facilitates securities lending arrangements whereby securities held by separate accounts maintained by BlackRock Life Limited are lent to third parties under global master securities lending agreements. In exchange, the Company receives legal title to the collateral with minimum values generally ranging from approximately 102% to 112% of the value of the securities lent in order to reduce counterparty risk. The required collateral value is calculated on a daily basis. The global master securities lending agreements provide the Company the right to request additional collateral or, in the event of borrower default, the right to liquidate collateral. The securities lending transactions entered into by the Company are accompanied by an agreement that entitles the Company to request the borrower to return the securities at any time; therefore, these transactions are not reported as sales.

The Company records on the condensed consolidated statements of financial condition the cash and noncash collateral received under these BlackRock Life Limited securities lending arrangements as its own asset in addition to an equal and offsetting collateral liability for the obligation to return the collateral. The securities lending revenue earned from lending securities held by the separate accounts is included in investment advisory, administration fees and securities lending revenue on the condensed consolidated statements of income. During the ~~three~~nine months ended ~~March 31,~~September 30, 2020 and 2019, the Company had not resold or repledged any of the collateral received under these arrangements. At ~~March 31,~~September 30, 2020 and December 31, 2019, the fair value of loaned securities held by separate accounts was approximately ~~$14.0~~$14 billion and $14.4 billion, respectively, and the fair value of the collateral held under these securities lending agreements was approximately ~~$14.8~~$15.1 billion and $15.5 billion, respectively.

On May 10, 2019, the Company acquired 100% of the equity interests of eFront Holding SAS (“eFront Transaction” or “eFront”), a leading alternative investment management software and solutions provider for approximately $1.3 billion, excluding the settlement of eFront’s outstanding debt. The acquisition of eFront expanded Aladdin’s illiquid alternative capabilities and enables BlackRock to provide individual alternative or whole-portfolio technology solutions to clients.

The purchase price was funded through a combination of existing cash and issuance of commercial paper (subsequently repaid with existing cash) and long-term notes in April 2019. A summary of the fair values of the assets acquired and liabilities assumed in this acquisition is as ~~follows~~⁽¹⁾:follows:


	Estimate of
(in millions)	Fair Value			Fair Value
Accounts receivable	$	61		$	61
Finite-lived intangible assets:
Customer relationships		400			400
Technology-related		203			203
Trade name		14			14
Goodwill		1,044			1,044
Other assets		49			49
Deferred income tax liabilities		(146	)		(146	)
Other liabilities assumed		(125	)		(125	)
Total consideration, net of cash acquired	$	1,500		$	1,500

Summary of consideration, net of cash acquired:
Cash paid including settlement of outstanding debt of approximately $0.2 billion	$	1,555		$	1,555
Cash acquired		(55	)		(55	)
Total consideration, net of cash acquired	$	1,500		$	1,500

The following table provides a reconciliation of cash and cash equivalents reported within the condensed consolidated statements of financial condition to the cash, cash equivalents, and restricted cash reported within the condensed consolidated statements of cash flows.

	March 31,		December 31,		September 30,		December 31,
	2020		2019		2020		2019
(in millions)
Cash and cash equivalents	$	4,406	$	4,829	$	6,507	$	4,829
Restricted cash included in other assets		17		17		17		17
Total cash, cash equivalents and restricted cash	$	4,423	$	4,846	$	6,524	$	4,846

	March 31,		December 31,		September 30,		December 31,
(in millions)	2020		2019		2020		2019
Debt securities:
Held-to-maturity investments	$	252	$	249	$	284	$	249
Trading securities		1,417		1,249		1,821		1,249
Total debt securities		1,669		1,498		2,105		1,498
Equity securities at FVTNI⁽¹⁾		1,565		1,926		2,090		1,926
Equity method investments⁽²⁾		860		943		1,036		943
Bank loans		204		204		226		204
Federal Reserve Bank stock⁽³⁾		93		93		94		93
Carried interest⁽⁴⁾		569		528		483		528
Other investments⁽⁵⁾		280		297		273		297
Total investments	$	5,240	$	5,489	$	6,307	$	5,489

The carrying value of held-to-maturity investments was ~~$252~~$284 million and $249 million at ~~March 31,~~September 30, 2020 and December 31, 2019, respectively. Held-to-maturity investments included certain investments in CLOs and foreign government debt held primarily for regulatory purposes. The amortized cost (carrying value) of these investments approximated fair value (primarily a Level 2 input). At ~~March 31,~~September 30, 2020, ~~$12~~$10 million mature between one to five years, ~~$115~~$149 million of these investments mature between five to ten years and $125 million mature after ten years.

A summary of the cost and carrying value of trading debt securities and equity securities at FVTNI is as follows:


	March 31, 2020				December 31, 2019				September 30, 2020				December 31, 2019
(in millions)	Cost		Carrying Value		Cost		Carrying Value		Cost		Carrying Value		Cost		Carrying Value
Trading debt securities:
Corporate debt	$	1,108	$	1,074	$	822	$	844	$	1,447	$	1,441	$	822	$	844
Government debt		250		250		268		269		269		270		268		269
Asset/mortgage-backed debt		112		93		141		136		126		110		141		136
Total trading debt securities	$	1,470	$	1,417	$	1,231	$	1,249	$	1,842	$	1,821	$	1,231	$	1,249
Equity securities at FVTNI:
Deferred compensation plan mutual funds	$	2	$	5	$	6	$	23
Equity securities/multi-asset mutual funds		1,615		1,560		1,763		1,903
Equity securities/mutual funds									$	1,989	$	2,090	$	1,769	$	1,926
Total equity securities at FVTNI	$	1,617	$	1,565	$	1,769	$	1,926	$	1,989	$	2,090	$	1,769	$	1,926

The Company consolidates certain sponsored investment funds accounted for as voting rights entities (“VREs”) because it is deemed to control such funds.

In the normal course of business, the Company is the manager of various types of sponsored investment vehicles, which may be considered VIEs. The Company may from time to time own equity or debt securities or enter into derivatives with the vehicles, each of which are considered variable interests. The Company’s involvement in financing the operations of the VIEs is generally limited to its investments in the entity. The Company’s consolidated VIEs include certain sponsored investment products in which BlackRock has an investment and as the investment manager, is deemed to have both the power to direct the most significant activities of the products and the right to receive benefits (or the obligation to absorb losses) that could potentially be significant to these sponsored investment products. The assets of these VIEs are not available to creditors of the Company. In addition, the investors in these VIEs have no recourse to the credit of the Company.

The following table presents the balances related to these consolidated sponsored investment products accounted for as VIEs and VREs that were recorded on the consolidated statements of financial condition, including BlackRock’s net interest in these products:

	March 31, 2020									December 31, 2019									September 30, 2020									December 31, 2019
(in millions)	VIEs			VREs			Total			VIEs			VREs			Total			VIEs			VREs			Total			VIEs			VREs			Total
Cash and cash equivalents	$	269		$	47		$	316		$	131		$	10		$	141		$	186		$	22		$	208		$	131		$	10		$	141
Investments:
Trading debt securities		1,244			145			1,389			1,059			151			1,210			1,551			238			1,789			1,059			151			1,210
Equity securities at FVTNI		996			346			1,342			1,330			332			1,662			1,458			397			1,855			1,330			332			1,662
Bank loans		204			—			204			204			—			204			226			—			226			204			—			204
Other investments		174			—			174			194			—			194			185			—			185			194			—			194
Carried interest		552			—			552			514			—			514			462			—			462			514			—			514
Total investments		3,170			491			3,661			3,301			483			3,784			3,882			635			4,517			3,301			483			3,784
Other assets		90			6			96			68			5			73			84			25			109			68			5			73
Other liabilities⁽¹⁾		(883	)		(26	)		(909	)		(820	)		(20	)		(840	)		(798	)		(71	)		(869	)		(820	)		(20	)		(840	)
Noncontrolling interest		(1,390	)		(107	)		(1,497	)		(1,348	)		(34	)		(1,382	)
Noncontrolling interests																				(2,026	)		(117	)		(2,143	)		(1,348	)		(34	)		(1,382	)
BlackRock's net interests in consolidated investment products	$	1,256		$	411		$	1,667		$	1,332		$	444		$	1,776		$	1,328		$	494		$	1,822		$	1,332		$	444		$	1,776

BlackRock’s total exposure to consolidated sponsored investment products represents the value of its economic ownership interest in these sponsored investment products. Valuation changes associated with investments held at fair value by these consolidated sponsored investment products are reflected in nonoperating income (expense) and partially offset in net income (loss) attributable to noncontrolling interests for the portion not attributable to BlackRock.

The Company cannot readily access cash and cash equivalents held by consolidated sponsored investment products to use in its operating activities.

Net gain (loss) related to consolidated VIEs is presented in the following table:

	Three Months Ended					Three Months Ended					Nine Months Ended
	March 31,					September 30,					September 30,
(in millions)	2020			2019		2020		2019			2020		2019

Nonoperating net gain (loss) on consolidated VIEs	$	(309	)	$	94	$	213	$	(5	)	$	186	$	128

Net income (loss) attributable to NCI on consolidated VIEs	$	(158	)	$	5	$	149	$	—		$	169	$	17

Nonconsolidated VIEs. At ~~March 31,~~September 30, 2020 and December 31, 2019, the Company’s carrying value of assets and liabilities included on the condensed consolidated statements of financial condition pertaining to nonconsolidated VIEs and its maximum risk of loss related to VIEs for which it held a variable interest, but for which it was not the primary beneficiary, was as follows:

(in millions)
At March 31, 2020	Investments		Advisory Fee Receivables		Other Net Assets (Liabilities)			Maximum Risk of Loss⁽¹⁾
At September 30, 2020										Investments		Advisory Fee Receivables		Other Net Assets (Liabilities)			Maximum Risk of Loss⁽¹⁾
Sponsored investment products	$	533	$	102	$	(12	)	$	652	$	626	$	80	$	(13	)	$	723
At December 31, 2019
Sponsored investment products	$	539	$	71	$	(10	)	$	627	$	539	$	71	$	(10	)	$	627

The net assets of sponsored investment products that are nonconsolidated VIEs approximated ~~$11~~$15 billion and $12 billion at ~~March 31,~~September 30, 2020 and December 31, 2019, respectively.

March 31, 2020 (in millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Investments Measured at NAV⁽¹⁾		Other⁽²⁾		March 31, 2020
September 30, 2020 (in millions)													Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Investments Measured at NAV⁽¹⁾		Other⁽²⁾		September 30, 2020
Assets:
Investments
Debt securities:
Held-to-maturity investments	$	—	$	—	$	—	$	—	$	252	$	252	$	—	$	—	$	—	$	—	$	284	$	284
Trading securities		—		1,408		9		—		—		1,417		—		1,810		11		—		—		1,821
Total debt securities		—		1,408		9		—		252		1,669		—		1,810		11		—		284		2,105
Equity securities at FVTNI:
Deferred compensation plan mutual funds		5		—		—		—		—		5
Equity securities/Multi-asset mutual funds		1,560		—		—		—		—		1,560
Total equity securities at FVTNI		1,565		—		—		—		—		1,565
Equity securities/mutual funds														2,090		—		—		—		—		2,090
Equity method:
Equity and fixed income mutual funds		145		—		—		—		—		145		242		—		—		—		—		242
Hedge funds/funds of hedge funds		—		—		—		222		—		222		—		—		—		266		—		266
Private equity funds		—		—		—		210		—		210		—		—		—		285		—		285
Real assets funds		—		—		—		271		—		271		—		—		—		234		—		234
Other		9		—		—		3		—		12		—		—		—		9		—		9
Total equity method		154		—		—		706		—		860		242		—		—		794		—		1,036
Bank loans		—		23		181		—		—		204		—		9		217		—		—		226
Federal Reserve Bank Stock		—		—		—		—		93		93		—		—		—		—		94		94
Carried interest		—		—		—		—		569		569		—		—		—		—		483		483
Other investments⁽³⁾		—		4		16		84		176		280		—		—		10		93		170		273
Total investments		1,719		1,435		206		790		1,090		5,240		2,332		1,819		238		887		1,031		6,307
Other assets⁽⁴⁾		133		181		—		—		—		314		192		18		—		—		—		210
Separate account assets		54,812		27,340		—		—		1,110		83,262		65,032		29,766		—		—		1,196		95,994
Separate account collateral held under securities lending agreements:
Equity securities		4,731		—		—		—		—		4,731		10,250		—		—		—		—		10,250
Debt securities		—		10,046		—		—		—		10,046		—		4,887		—		—		—		4,887
Total separate account collateral held under securities lending agreements		4,731		10,046		—		—		—		14,777		10,250		4,887		—		—		—		15,137
Total	$	61,395	$	39,002	$	206	$	790	$	2,200	$	103,593	$	77,806	$	36,490	$	238	$	887	$	2,227	$	117,648
Liabilities:
Separate account collateral liabilities under securities lending agreements	$	4,731	$	10,046	$	—	$	—	$	—	$	14,777	$	10,250	$	4,887	$	—	$	—	$	—	$	15,137
Other liabilities⁽⁵⁾		—		28		421		—		—		449		—		36		261		—		—		297
Total	$	4,731	$	10,074	$	421	$	—	$	—	$	15,226	$	10,250	$	4,923	$	261	$	—	$	—	$	15,434

December 31, 2019 (in millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Investments Measured at NAV⁽¹⁾		Other⁽²⁾		December 31, 2019		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Investments Measured at NAV⁽¹⁾		Other⁽²⁾		December 31, 2019
Assets:
Investments
Debt securities:
Held-to-maturity investments	$	—	$	—	$	—	$	—	$	249	$	249	$	—	$	—	$	—	$	—	$	249	$	249
Trading securities		—		1,241		8		—		—		1,249		—		1,241		8		—		—		1,249
Total debt securities		—		1,241		8		—		249		1,498		—		1,241		8		—		249		1,498
Equity securities at FVTNI:
Deferred compensation plan mutual funds		23		—		—		—		—		23
Equity securities/Multi-asset mutual funds		1,903		—		—		—		—		1,903
Total equity securities at FVTNI		1,926		—		—		—		—		1,926
Equity securities/mutual funds														1,926		—		—		—		—		1,926
Equity method:
Equity and fixed income mutual funds		157		—		—		—		—		157		157		—		—		—		—		157
Hedge funds/funds of hedge funds		—		—		—		220		—		220		—		—		—		220		—		220
Private equity funds		—		—		—		248		—		248		—		—		—		248		—		248
Real assets funds		—		—		—		296		—		296		—		—		—		296		—		296
Other		12		—		—		10		—		22		12		—		—		10		—		22
Total equity method		169		—		—		774		—		943		169		—		—		774		—		943
Bank loans		—		27		177		—		—		204		—		27		177		—		—		204
Federal Reserve Bank Stock		—		—		—		—		93		93		—		—		—		—		93		93
Carried interest		—		—		—		—		528		528		—		—		—		—		528		528
Other investments⁽³⁾		—		—		9		98		190		297		—		—		9		98		190		297
Total investments		2,095		1,268		194		872		1,060		5,489		2,095		1,268		194		872		1,060		5,489
Other assets⁽⁴⁾		173		—		—		—		—		173		173		—		—		—		—		173
Separate account assets		72,515		29,582		—		—		747		102,844		72,515		29,582		—		—		747		102,844
Separate account collateral held under securities lending agreements:
Equity securities		10,209		—		—		—		—		10,209		10,209		—		—		—		—		10,209
Debt securities		—		5,257		—		—		—		5,257		—		5,257		—		—		—		5,257
Total separate account collateral held under securities lending agreements		10,209		5,257		—		—		—		15,466		10,209		5,257		—		—		—		15,466
Total	$	84,992	$	36,107	$	194	$	872	$	1,807	$	123,972	$	84,992	$	36,107	$	194	$	872	$	1,807	$	123,972
Liabilities:
Separate account collateral liabilities under securities lending agreements	$	10,209	$	5,257	$	—	$	—	$	—	$	15,466	$	10,209	$	5,257	$	—	$	—	$	—	$	15,466
Other liabilities⁽⁵⁾		—		10		388		—		—		398		—		10		388		—		—		398
Total	$	10,209	$	5,267	$	388	$	—	$	—	$	15,864	$	10,209	$	5,267	$	388	$	—	$	—	$	15,864

Level 3 Assets. Level 3 assets may include investments in CLOs and bank loans of consolidated CLOs, which were valued based on single-broker nonbinding quotes and direct private equity investments, which were valued using the market or income approach.

Level 3 investments of ~~$206~~$238 million and $194 million at ~~March 31,~~September 30, 2020 and December 31, 2019, respectively, primarily included bank loans of a consolidated ~~CLO and investments in CLOs.~~CLO.

Level 3 Liabilities. Level 3 liabilities primarily include ~~contingent liabilities associated with certain acquisitions, which were valued based upon discounted cash flow analyses using unobservable market data inputs and~~ borrowings of a consolidated CLO, which were valued based on the fair value of the assets of the consolidated CLO less the fair value of the Company’s economic interest in the ~~CLO.~~CLO, and contingent liabilities related to certain acquisitions, which were valued based upon discounted cash flow analyses using unobservable market data inputs.

Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis for the Three Months Ended ~~March 31,~~September 30, 2020

(in millions)	December 31, 2019		Realized and Unrealized Gains (Losses)			Purchases		Sales and Maturities			Issuances and other Settlements⁽¹⁾		Transfers into Level 3		Transfers out of Level 3		March 31, 2020		Total Net Unrealized Gains (Losses) Included in Earnings⁽²⁾			June 30, 2020		Realized and Unrealized Gains (Losses)		Purchases		Sales and Maturities			Issuances and other Settlements⁽¹⁾			Transfers into Level 3		Transfers out of Level 3			September 30, 2020		Total Net Unrealized Gains (Losses) Included in Earnings⁽²⁾
Assets:
Investments:
Debt securities:
Trading	$	8	$	—		$	1	$	—		$	—	$	—	$	—	$	9	$	—		$	10	$	—	$	1	$	—		$	—		$	—	$	—		$	11	$	—
Total debt securities		8		—			1		—			—		—		—		9		—			10		—		1		—			—			—		—			11		—
Private equity		9		—			8		(1	)		—		—		—		16		—			16		—		—		(6	)		—			—		—			10		—
Bank loans		177		(14	)		18		—			—		—		—		181		(14	)		229		—		—		(9	)		—			—		(3	)		217		—
Total investments	$	194	$	(14	)	$	27	$	(1	)	$	—	$	—	$	—	$	206	$	(14	)	$	255	$	—	$	1	$	(15	)	$	—		$	—	$	(3	)	$	238	$	—
Liabilities:
Other liabilities⁽³⁾	$	388	$	(11	)	$	—	$	—		$	22	$	—	$	—		421	$	(11	)	$	262	$	—	$	—	$	—		$	(1	)	$	—	$	—		$	261	$	—
Total Level 3 liabilities	$	388	$	(11	)	$	—	$	—		$	22	$	—	$	—	$	421	$	(11	)	$	262	$	—	$	—	$	—		$	(1	)	$	—	$	—		$	261	$	—

Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis for the Nine Months Ended September 30, 2020

(in millions)	December 31, 2019		Realized and Unrealized Gains (Losses)			Purchases		Sales and Maturities			Issuances and other Settlements⁽¹⁾			Transfers into Level 3		Transfers out of Level 3			September 30, 2020		Total Net Unrealized Gains (Losses) Included in Earnings⁽²⁾
Assets:
Investments:
Debt securities:
Trading	$	8	$	—		$	3	$	—		$	—		$	—	$	—		$	11	$	—
Total debt securities		8		—			3		—			—			—		—			11		—
Private equity		9		—			8		(7	)		—			—		—			10		—
Bank loans		177		—			36		(9	)		—			16		(3	)		217		—
Total investments	$	194	$	—		$	47	$	(16	)	$	—		$	16	$	(3	)	$	238	$	—
Liabilities:
Other liabilities⁽³⁾	$	388	$	(23	)	$	—	$	—		$	(150	)	$	—	$	—		$	261	$	(5	)
Total Level 3 liabilities	$	388	$	(23	)	$	—	$	—		$	(150	)	$	—	$	—		$	261	$	(5	)

Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis for the Three Months Ended September 30, 2019

(in millions)	June 30, 2019		Realized and Unrealized Gains (Losses)		Purchases		Sales and Maturities		Issuances and other Settlements⁽¹⁾		Transfers into Level 3		Transfers out of Level 3			September 30, 2019		Total Net Unrealized Gains (Losses) Included in Earnings⁽²⁾
Assets:
Investments:
Debt securities:
Trading	$	2	$	—	$	3	$	—	$	—	$	—	$	—		$	5	$	—
Total debt securities		2		—		3		—		—		—		—			5		—
Private equity		9		1		—		—		—		—		(1	)		9		1
Bank loans		125		—		32		—		—		—		—			157		—
Total investments		136		1		35		—		—		—		(1	)		171		1
Total Level 3 assets	$	136	$	1	$	35	$	—	$	—	$	—	$	(1	)	$	171	$	1
Liabilities:
Other liabilities⁽³⁾	$	310	$	1	$	—	$	—	$	44	$	—	$	—		$	353	$	1
Total Level 3 liabilities	$	310	$	1	$	—	$	—	$	44	$	—	$	—		$	353	$	1

Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis for the ~~Three~~Nine Months Ended ~~March 31,~~September 30, 2019

(in millions)	December 31, 2018		Realized and Unrealized Gains (Losses)			Purchases		Sales and Maturities		Issuances and other Settlements⁽¹⁾		Transfers into Level 3		Transfers out of Level 3⁽²⁾			March 31, 2019		Total Net Unrealized Gains (Losses) Included in Earnings⁽³⁾			December 31, 2018		Realized and Unrealized Gains (Losses)			Purchases		Sales and Maturities		Issuances and other Settlements⁽¹⁾			Transfers into Level 3		Transfers out of Level 3⁽²⁾			September 30, 2019		Total Net Unrealized Gains (Losses) Included in Earnings⁽³⁾
Assets:
Investments:
Debt securities:
Trading	$	4	$	—		$	—	$	—	$	—	$	—	$	(4	)	$	—	$	—		$	4	$	—		$	5	$	—	$	—		$	—	$	(4	)	$	5	$	—
Total debt securities		4		—			—		—		—		—		(4	)		—		—			4		—			5		—		—			—		(4	)		5		—
Private equity		82		—			—		—		—		—		(72	)		10		—			82		—			—		—		—			—		(73	)		9		—
Bank loans⁽⁴⁾		70		—			53		—		—		—		—			123		—			70		—			87		—		—			—		—			157		—
Total investments		156		—			53		—		—		—		(76	)		133		—			156		—			92		—		—			—		(77	)		171		—
Total Level 3 assets	$	156	$	—		$	53	$	—	$	—	$	—	$	(76	)	$	133	$	—		$	156	$	—		$	92	$	—	$	—		$	—	$	(77	)	$	171	$	—
Liabilities:
Other liabilities⁽⁴⁾	$	371	$	(6	)	$	—	$	—	$	32	$	—	$	—		$	409	$	(6	)	$	371	$	(18	)	$	—	$	—	$	(36	)	$	—	$	—		$	353	$	(18	)
Total Level 3 liabilities	$	371	$	(6	)	$	—	$	—	$	32	$	—	$	—		$	409	$	(6	)	$	371	$	(18	)	$	—	$	—	$	(36	)	$	—	$	—		$	353	$	(18	)

Realized and Unrealized Gains (Losses) for Level 3 Assets and Liabilities. Realized and unrealized gains (losses) recorded for Level 3 assets and liabilities are reported in nonoperating income (expense) on the condensed consolidated statements of income. A portion of net income (loss) for consolidated sponsored investment funds is allocated to noncontrolling interests to reflect net income (loss) not attributable to the Company.

Transfers in and/or out of Levels. Transfers in and/or out of levels are reflected when significant inputs, including market inputs or performance attributes, used for the fair value measurement become observable/unobservable, or when the carrying value of certain equity method investments no longer represents fair value as determined under valuation methodologies.

Disclosures of Fair Value for Financial Instruments Not Held at Fair Value. At ~~March 31,~~September 30, 2020 and December 31, 2019, the fair value of the Company’s financial instruments not held at fair value are categorized in the table below:

	March 31, 2020				December 31, 2019						September 30, 2020				December 31, 2019
(in millions)	Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value		Fair Value Hierarchy		Carrying Amount		Estimated Fair Value		Carrying Amount		Estimated Fair Value		Fair Value Hierarchy
Financial Assets⁽¹⁾:
Cash and cash equivalents	$	4,406	$	4,406	$	4,829	$	4,829	Level 1	^{(2) (3)}	$	6,507	$	6,507	$	4,829	$	4,829	Level 1	^{(2) (3)}
Other assets	$	21	$	21	$	68	$	68	Level 1	⁽⁴⁾	$	41	$	41	$	68	$	68	Level 1	⁽⁴⁾

Financial Liabilities:
Long-term borrowings	$	5,933	$	6,147	$	4,955	$	5,254	Level 2	⁽⁵⁾	$	7,227	$	7,857	$	4,955	$	5,254	Level 2	⁽⁵⁾

As a practical expedient to value certain investments that do not have a readily determinable fair value and have attributes of an investment company, the Company uses NAV as the fair value. The following tables list information regarding all investments in entities that use a fair value measurement to account for both their financial assets and financial liabilities in their calculation of a NAV per share (or equivalent).

March 31, 2020

September 30, 2020

(in millions)

Ref

Fair Value

Total

Unfunded

Commitments

Redemption

Frequency

Redemption

Notice Period

Ref

Fair Value

Total

Unfunded

Commitments

Redemption

Frequency

Redemption

Notice Period

Equity method:⁽¹⁾

Hedge funds/funds of hedge funds

(a)

222

112

Daily/Monthly (25%)

Quarterly (16%)

N/R (59%)

1 – 90 days

(a)

266

107

Daily/Monthly (23%)

Quarterly (20%)

N/R (57%)

1 – 90 days

Private equity funds

(b)

210

231

N/R

(b)

285

253

N/R

Real assets funds

(c)

271

131

Quarterly (53%)

N/R (47%)

60 days

(c)

234

216

Quarterly (41%)

N/R (59%)

60 days

Other

N/R

Consolidated sponsored investment

products:

Private equity funds of funds

(d)

N/R

(d)

N/R

Hedge fund

(a)

—

Quarterly

90 days

(a)

—

Quarterly

90 days

Real assets funds

(c)

N/R

(c)

101

N/R

Total

790

567

887

690

December 31, 2019

(in millions)

Ref

Fair Value

Total

Unfunded

Commitments

Redemption

Frequency

Redemption

Notice Period

Ref

Fair Value

Total

Unfunded

Commitments

Redemption

Frequency

Redemption

Notice Period

Equity method:⁽¹⁾

Hedge funds/funds of hedge funds

(a)

220

120

Daily/Monthly (27%)

Quarterly (15%)

N/R (58%)

1 – 90 days

(a)

220

120

Daily/Monthly (27%)

Quarterly (15%)

N/R (58%)

1 – 90 days

Private equity funds

(b)

248

212

N/R

(b)

248

212

N/R

Real assets funds

(c)

296

120

Quarterly (57%)

N/R (43%)

60 days

(c)

296

120

Quarterly (57%)

N/R (43%)

60 days

Other

N/R

Consolidated sponsored investment

products:

Private equity funds of funds

(d)

N/R

(d)

N/R

Hedge fund

(a)

—

Quarterly

90 days

(a)

—

Quarterly

90 days

Real assets funds

(c)

N/R

(c)

N/R

Total

872

553

872

553

At ~~March 31,~~September 30, 2020 and December 31, 2019, the Company elected the fair value option for certain investments in CLOs of approximately ~~$28~~$32 million and $37 million, respectively, reported within investments.

In addition, the Company elected the fair value option for bank loans and borrowings of a consolidated CLO, recorded within investments and other liabilities, respectively. The following table summarizes the information related to these bank loans and borrowings at ~~March 31,~~September 30, 2020 and December 31, 2019:

	March 31,		December 31,		September 30,		December 31,
(in millions)	2020		2019		2020		2019
CLO Bank loans:
Aggregate principal amounts outstanding	$	220	$	204	$	231	$	204
Fair value		204		204		226		204
Aggregate unpaid principal balance in excess of (less than) fair value	$	16	$	—	$	5	$	—

CLO Borrowings:
Aggregate principal amounts outstanding	$	226	$	195	$	249	$	195
Fair value	$	203	$	195	$	233	$	195

At ~~March 31,~~September 30, 2020, the principal amounts outstanding of the borrowings issued by the CLOs mature in 2030.

During the three and nine months ended ~~March 31,~~September 30, 2020 and 2019, the net gains (losses) from the change in fair value of the bank loans and borrowings held by the consolidated CLO were not material and were recorded in net gain (loss) on the condensed consolidated statements of income. The change in fair value of the assets and liabilities included interest income and expense, respectively.

The Company maintains a program to enter into swaps to hedge against market price and interest rate exposures with respect to certain seed investments in sponsored investment products. At ~~March 31,~~September 30, 2020 and December 31, 2019, the Company had outstanding total return swaps with aggregate notional values of approximately ~~$597~~$735 million and $644 million, respectively.

The Company executes forward foreign currency exchange contracts to mitigate the risk of certain foreign exchange movements. At ~~March 31,~~September 30, 2020 and December 31, 2019, the Company had outstanding forward foreign currency exchange contracts with aggregate notional values of approximately ~~$2.5~~$4.1 billion and $3.4 billion, respectively and with expiration dates in October 2020 and January 2020, respectively.

At both ~~March 31,~~September 30, 2020 and December 31, 2019, the Company had a derivative providing credit protection with a notional amount of approximately $17 million to a counterparty, representing the Company’s maximum risk of loss with respect to the derivative. The Company carries the derivative at fair value based on the expected discounted future cash outflows under the arrangement.

The following table presents the fair values of derivative instruments recognized in the condensed consolidated statements of financial condition at ~~March 31,~~September 30, 2020:

	March 31, 2020						September 30, 2020
(in millions)	Assets			Liabilities			Assets			Liabilities
Derivative instruments	Statement of Financial Condition Classification	Fair Value		Statement of Financial Condition Classification	Fair Value		Statement of Financial Condition Classification	Fair Value		Statement of Financial Condition Classification	Fair Value
Total return swaps	Other assets	$	89	Other liabilities	$	7	Other assets	$	6	Other liabilities	$	10
Forward foreign currency exchange contracts	Other assets		92	Other liabilities		9	Other assets		12	Other liabilities		13
Total		$	181		$	16		$	18		$	23

The fair values of the outstanding total return swaps and forward foreign currency exchange contracts were not material to the condensed consolidated statement of financial condition at December 31, 2019.

The following table presents realized and unrealized gains (losses) recognized in the condensed consolidated statements of income on derivative instruments:

			Three Months Ended								Three Months Ended						Nine Months Ended
			March 31,								September 30,						September 30,
(in millions)			2020			2019					2020			2019			2020			2019
Derivative Instruments		Statement of Income Classification	Gains (Losses)							Statement of Income Classification	Gains (Losses)						Gains (Losses)
Total return swaps		Nonoperating income (expense)	$	142		$	(50	)		Nonoperating income (expense)	$	(42	)	$	2		$	9		$	(62	)
Forward foreign currency exchange contracts		General and administration expense		(88	)		36			General and administration expense		64			(43	)		(34	)		(56	)
Total gain (loss) from derivative instruments	Total gain (loss) from derivative instruments		$	54		$	(14	)	Total gain (loss) from derivative instruments		$	22		$	(41	)	$	(25	)	$	(118	)

The Company consolidates certain sponsored investment funds, which may utilize derivative instruments as a part of the funds’ investment strategies. The ~~change~~changes in fair value of such derivatives, which isare recorded in nonoperating income (expense), ~~was~~were not material for the three and nine months ended ~~March 31,~~September 30, 2020 and 2019.

See Note 15, Borrowings, in the 2019 Form 10-K for more information on the Company’s net investment hedge.

Goodwill activity during the ~~three~~nine months ended ~~March 31,~~September 30, 2020 was as follows:

(in millions)
December 31, 2019	$	14,562		$	14,562
Goodwill adjustments related to Quellos⁽¹⁾		(3	)		(8	)
March 31, 2020	$	14,559
September 30, 2020				$	14,554

The carrying amounts of identifiable intangible assets are summarized as follows:

(in millions)	Indefinite-lived		Finite-lived			Total			Indefinite-lived		Finite-lived			Total
December 31, 2019	$	17,578	$	791		$	18,369		$	17,578	$	791		$	18,369
Amortization expense		—		(25	)		(25	)		—		(79	)		(79	)
March 31, 2020	$	17,578	$	766		$	18,344
September 30, 2020									$	17,578	$	712		$	18,290

The following table presents components of lease cost included in general and administration expense on the condensed consolidated statement of income:

	Three Months Ended				Three Months Ended				Nine Months Ended
	March 31,				September 30,				September 30,
(in millions)	2020		2019		2020		2019		2020		2019
Lease cost:
Operating lease cost⁽¹⁾	$	37	$	34	$	37	$	36	$	110	$	104
Variable lease cost⁽²⁾		9		8		10		10		29		28
Total lease cost	$	46	$	42	$	47	$	46	$	139	$	132

The following table presents operating leases included on the condensed consolidated statement of financial condition:

	Statement of					Statement of
	Financial Condition	March 31,		December 31,		Financial Condition	September 30,		December 31,
(in millions)	Classification	2020		2019		Classification	2020		2019
Statement of Financial Condition information:
Operating lease right-of-use (“ROU”) assets	Other assets	$	662	$	669
Operating lease right-of-use ("ROU") assets						Other assets	$	646	$	669
Operating lease liabilities	Other liabilities	$	774	$	776	Other liabilities	$	756	$	776

	Three Months Ended				Nine Months Ended
	March 31,				September 30,
(in millions)	2020		2019		2020		2019
Supplemental cash flow information:
Cash paid for amounts included in the measurement of operating lease liabilities	$	38	$	35	$	114	$	105

Supplemental noncash information:
ROU assets in exchange for operating lease liabilities in connection with the adoption of ASU 2016-02	$	—	$	661
ROU assets in exchange for operating lease liabilities in connection with the adoption of ASU 2016-02, "Leases"					$	—	$	661
ROU assets in exchange for operating lease liabilities	$	47	$	—	$	77	$	54

	March 31,			December 31,			September 30,			December 31,
	2020			2019			2020			2019
Lease term and discount rate:
Weighted-average remaining lease term		9	years		9	years		8	years		9	years
Weighted-average discount rate		3	%		3	%		3	%		3	%

At December 31, 2019, the Company accounted for its interest in PennyMac Financial Services, Inc. (“PennyMac”) as an equity method investment, which was included in other assets on the condensed consolidated statements of financial condition. The carrying value and market value of the Company’s interest (approximately 20% or 16 million shares) were approximately $451 million and $530 million, respectively, at December 31, 2019. The market value of the Company’s interest reflected the PennyMac stock price at December 31, 2019 (a Level 1 input).

On February 13, 2020, BlackRock ~~established~~announced the establishment of The BlackRock Foundation (the “Foundation”) and ~~contributed~~the contribution of its remaining 20% stake in PennyMac to the Foundation and the BlackRock Charitable Fund, which BlackRock established in 2013 (together, the “Charitable Contribution”). The Charitable Contribution resulted in an operating expense of $589 million, which was offset by a $122 million noncash, nonoperating pre-tax gain on the contributed shares and a tax benefit of $241 million in the condensed consolidated statement of income for the ~~three~~nine months ended ~~March 31,~~September 30, 2020.

On March 10, 2020, in connection with a recapitalization of iCapital Network, Inc. (“iCapital”), BlackRock received additional stock in exchange for certain securities it held, which resulted in a nonoperating pre-tax gain of approximately $240 million in the condensed consolidated statement of income for the ~~three~~nine months ended ~~March 31,~~September 30, 2020. Following this transaction, the Company accounts for its interest in iCapital as an equity method investment, which is included in other assets on the condensed consolidated statements of financial condition. At ~~March 31,~~September 30, 2020, the carrying value of the Company’s interest in iCapital iswas approximately ~~$300~~$297 million.

2020 Revolving Credit Facility. The Company’s credit facility has an aggregate commitment amount of $4.0 billion and was amended in March 2020 to extend the maturity date to March 2025 (the “2020 credit facility”). The 2020 credit facility permits the Company to request up to an additional $1.0 billion of borrowing capacity, subject to lender credit approval, increasing the overall size of the 2020 credit facility to an aggregate principal amount not to exceed $5.0 billion. Interest on borrowings outstanding accrues at a rate based on the applicable London Interbank Offered Rate plus a spread. The 2020 credit facility requires the Company not to exceed a maximum leverage ratio (ratio of net debt to earnings before interest, taxes, depreciation and amortization, where net debt equals total debt less unrestricted cash) of 3 to 1, which was satisfied with a ratio of less than 1 to 1 at ~~March 31,~~September 30, 2020. The 2020 credit facility provides back-up liquidity to fund ongoing working capital for general corporate purposes and various investment opportunities. At ~~March 31,~~September 30, 2020, the Company had 0 amount outstanding under the 2020 credit facility.

Commercial Paper Program. The Company can issue unsecured commercial paper notes (the “CP Notes”) on a private-placement basis up to a maximum aggregate amount outstanding at any time of $4.0 billion. The commercial paper program is currently supported by the 2020 credit facility. At ~~March 31,~~September 30, 2020, BlackRock had 0 CP Notes outstanding.

The carrying value and fair value of long-term borrowings determined using market prices and EUR/USD foreign exchange rate at ~~March 31,~~September 30, 2020 included the following:

(in millions)	Maturity Amount		Unamortized Discount and Debt Issuance Costs			Carrying Value		Fair Value		Maturity Amount		Unamortized Discount and Debt Issuance Costs			Carrying Value		Fair Value
4.25% Notes due 2021	$	750	$	—		$	750	$	770	$	750	$	—		$	750	$	769
3.375% Notes due 2022		750		(2	)		748		774		750		(2	)		748		787
3.50% Notes due 2024		1,000		(3	)		997		1,058		1,000		(3	)		997		1,102
1.25% Notes due 2025		768		(4	)		764		767		821		(3	)		818		868
3.20% Notes due 2027		700		(5	)		695		730		700		(5	)		695		794
3.25% Notes due 2029		1,000		(14	)		986		1,050		1,000		(12	)		988		1,155
2.40% Notes due 2030		1,000		(7	)		993		998		1,000		(7	)		993		1,086
1.90% Notes due 2031											1,250		(12	)		1,238		1,296
Total Long-term Borrowings	$	5,968	$	(35	)	$	5,933	$	6,147	$	7,271	$	(44	)	$	7,227	$	7,857

2030 Notes. In January 2020, the Company issued $1 billion in aggregate principal amount of 2.40% senior unsecured and unsubordinated notes maturing on April 30, 2030 (the “2030 Notes”). The net proceeds of the 2030 Notes were used for general corporate purposes. Interest of approximately $24 million per year is payable semi-annually on April 30 and October 30 of each year, ~~commencing~~which commenced on April 30, 2020. The 2030 Notes may be redeemed prior to January 30, 2030 in whole or in part at any time, at the option of the Company, at a “make-whole” redemption price or at 100% of the principal amount of the 2030 Notes thereafter. The unamortized discount and debt issuance costs are being amortized over the remaining term of the 2030 Notes.

2031 Notes. In April 2020, the Company issued $1.25 billion in aggregate principal amount of 1.90% senior unsecured and unsubordinated notes maturing on January 28, 2031 (the “2031 Notes”). The net proceeds of the 2031 Notes are being used for general corporate purposes, which may include the future repayment of all or a portion of the $750 million 4.25% Notes due May 2021. Interest of approximately $24 million per year is payable semi-annually on January 28 and July 28 of each year, which commenced on July 28, 2020. The 2031 Notes may be redeemed prior to October 28, 2030 in whole or in part at any time, at the option of the Company, at a “make-whole” redemption price or at 100% of the principal amount of the 2031 Notes thereafter. The unamortized discount and debt issuance costs are being amortized over the remaining term of the 2031 Notes.

See Note 15, Borrowings, in the 2019 Form 10-K for more information regarding the Company’s borrowings.

~~See Note 24,~~ ~~Subsequent Events, for information on the April 2020 debt offering.~~

Investment Commitments. At ~~March 31,~~September 30, 2020, the Company had ~~$583~~$703 million of various capital commitments to fund sponsored investment products, including consolidated sponsored investment products. These products include private equity funds, real assets funds and opportunistic funds. This amount excludes additional commitments made by consolidated funds of funds to underlying third-party funds as third-party noncontrolling interest holders have the legal obligation to fund the respective commitments of such funds of funds. Generally, the timing of the funding of these commitments is unknown and the commitments are callable on demand at any time prior to the expiration of the commitment. These unfunded commitments are not recorded on the condensed consolidated statements of financial condition. These commitments do not include potential future commitments approved by the Company that are not yet legally binding. The Company intends to make additional capital commitments from time to time to fund additional investment products for, and with, its clients.

Contingent Payments Related to Business Acquisitions. In connection with certain acquisitions, BlackRock is required to make contingent payments, subject to achieving specified performance targets, which may include revenue related to acquired contracts or new capital commitments for certain products. The fair value of the remaining aggregate contingent payments at ~~March 31,~~September 30, 2020 totaled ~~$218~~$28 million and is included in other liabilities on the condensed consolidated statements of financial condition.

Other Contingent Payments. The Company acts as the portfolio manager in a series of derivative transactions and has a maximum potential exposure of $17 million between the Company and counterparty. See Note 9, Derivatives and Hedging, for further discussion.

Legal Proceedings. From time to time, BlackRock receives subpoenas or other requests for information from various US federal and state governmental and regulatory authorities and international governmental and regulatory authorities in connection with industry-wide or other investigations or proceedings. It is BlackRock’s policy to cooperate fully with such matters. The Company, certain of its subsidiaries and employees have been named as defendants in various legal actions, including arbitrations and other litigation arising in connection with BlackRock’s activities.

Additionally, BlackRock-advised investment portfolios may be subject to lawsuits, any of which potentially could harm the investment returns of the applicable portfolio or result in the Company being liable to the portfolios for any resulting damages.

On May 27, 2014, certain investors in the BlackRock Global Allocation Fund, Inc. and the BlackRock Equity Dividend Fund (collectively, the “Funds”) filed a consolidated complaint (the “Consolidated Complaint”) in the US District Court for the District of New Jersey against BlackRock Advisors, LLC, BlackRock Investment Management, LLC and BlackRock International Limited under the caption In re BlackRock Mutual Funds Advisory Fee Litigation. In the lawsuit, which ~~purports~~purported to be brought derivatively on behalf of the Funds, the plaintiffs ~~allege~~alleged that the defendants violated Section 36(b) of the Investment Company Act by receiving allegedly excessive investment advisory fees from the Funds. On June 13, 2018, the court granted in part and denied in part the defendants’ motion for summary judgment. On July 25, 2018, the plaintiffs served a pleading that supplemented the time period of their alleged damages to run through the date of trial. The lawsuit ~~seeks,~~sought, among other things, to recover on behalf of the Funds all allegedly excessive advisory fees received by the defendants beginning twelve months preceding the start of the lawsuit with respect to each Fund and ending on the date of judgment, along with purported lost investment returns on those amounts, plus interest. The trial on the remaining issues was completed on August 29, 2018. On February 8, 2019, the court issued an order dismissing the claims in their entirety. On May 28, 2020, the Third Circuit Court of Appeals affirmed the trial court’s summary judgment and trial rulings. On June 26, 2020, Plaintiffs petitioned the appeals court for a rehearing, which was denied July 9, 2020. The ~~plaintiffs filed a notice of~~plaintiffs’ deadline to seek further appeal ~~on March 8, 2019, which remains pending. The defendants believe the claims in~~has passed. Consequently, BlackRock now considers this ~~lawsuit are without merit.~~matter closed.

On June 16, 2016, iSharesTrust, BlackRock, Inc. and certain of its advisory subsidiaries, and the directors and certain officers of the iShares ETFs were named as defendants in a purported class action lawsuit filed in California state court. The lawsuit was filed by investors in certainiShares ETFs (the "ETFs"), and ~~alleges~~alleged the defendants violated the federal securities laws by failing to adequately disclose in prospectuses issued by the ETFs the risks to the ETFs’ shareholders in the event of a "flash crash." The plaintiffs ~~seek~~sought unspecified monetary and rescission damages. The plaintiffs’ complaint was dismissed in December 2016 and on January 6, 2017, the plaintiffs filed an amended complaint. On April 27, 2017, the court partially granted the defendants’ motion for judgment on the pleadings, dismissing certain of the plaintiffs’ claims. On September 18, 2017, the court issued a decision dismissing the remainder of the lawsuit after a one-day bench trial. On December 1, 2017, the plaintiffs appealed the dismissal of their lawsuit and, on January 23, 2020, the California Court of Appeal affirmed the trial court’s dismissal. ~~Plaintiffs have asked~~On May 27, 2020, the California Supreme Court denied plaintiffs’ petition for further review of the appeal. The plaintiffs’ deadline to ~~hear a~~seek further appeal ~~of the dismissal. The defendants believe the claims in~~has passed. Consequently, BlackRock now considers this ~~lawsuit are without merit.~~matter closed.

October 18, 2017, the plaintiffs filed an Amended Complaint, which, among other things, added as defendants certain current and former members of the BlackRock Retirement and Investment Committees. The Amended Complaint also included a new purported class claim on behalf of investors in certain ~~Collective Trust Funds (“CTFs”)~~CTFs managed by BTC. Specifically, the plaintiffs allege that BTC, as fiduciary to the CTFs, engaged in self-dealing by, most significantly, selecting itself as the securities lending agent on terms that the plaintiffs claim were excessive. The Amended Complaint also alleged that BlackRock took undue risks in its management of securities lending cash reinvestment vehicles during the financial crisis. On August 23, 2018, the court granted permission to the plaintiffs to file a Second Amended Complaint (“SAC”) which added as defendants the BlackRock, Inc. Management Development and Compensation Committee, the Plan’s independent investment consultant and the Plan’s Administrative Committee and its members. On October 22, 2018, BlackRock filed a motion to dismiss the SAC, and on June 3, 2019, the plaintiffs filed a motion seeking to certify both the Plan and the CTF classes. On September 3, 2019, the court granted BlackRock’s motion to dismiss part of the plaintiffs’ claim seeking to recover alleged losses in the securities lending vehicles but denied the motion to dismiss in all other respects. On February 11, 2020, the court denied the plaintiffs’ motion to certify the CTF class and granted their motion to certify the Plan class. On April 27, 2020, the Ninth Circuit denied the plaintiffs’ request to immediately appeal the class certification ruling. On September 24, 2020, the parties cross-moved for summary judgment. Any issues remaining in the case after the court rules on the summary judgment motions will be resolved at a trial, currently scheduled to begin on March 1, 2021. The defendants believe the claims in this lawsuit are without merit.

Management, after consultation with legal counsel, currently does not anticipate that the aggregate liability arising out of regulatory matters or lawsuits will have a material effect on BlackRock’s results of operations, financial position, or cash flows. However, there is no assurance as to whether any such pending or threatened matters will have a material effect on BlackRock’s results of operations, financial position or cash flows in any future reporting period. Due to uncertainties surrounding the outcome of these matters, management cannot reasonably estimate the possible loss or range of loss that may arise from these matters.

Indemnifications. In the ordinary course of business or in connection with certain acquisition agreements, BlackRock enters into contracts pursuant to which it may agree to indemnify third parties in certain circumstances. The terms of these indemnities vary from contract to contract and the amount of indemnification liability, if any, cannot be determined or the likelihood of any liability is considered remote. Consequently, no liability has been recorded on the condensed consolidated statements of financial condition.

In connection with securities lending transactions, BlackRock has agreed to indemnify certain securities lending clients against potential loss resulting from a borrower’s failure to fulfill its obligations under the securities lending agreement should the value of the collateral pledged by the borrower at the time of default be insufficient to cover the borrower’s obligation under the securities lending agreement. The amount of securities on loan as of ~~March 31,~~September 30, 2020 and subject to this type of indemnification was ~~$224~~$249 billion. In the Company’s capacity as lending agent, cash and securities totaling ~~$238~~$265 billion were held as collateral for indemnified securities on loan at ~~March 31,~~September 30, 2020. The fair value of these indemnifications was not material at ~~March 31,~~September 30, 2020.

The table below presents detail of revenue for the three and nine months ended ~~March 31,~~September 30, 2020 and 2019 and includes the product mix of investment advisory, administration fees and securities lending revenue (collectively “base fees”) and performance fees.

	Three Months Ended				Three Months Ended				Nine Months Ended
	March 31,				September 30,				September 30,
(in millions)	2020		2019		2020		2019		2020		2019
Investment advisory, administration fees and securities lending revenue:
Equity:
Active	$	398	$	375	$	457	$	391	$	1,236	$	1,151
iShares ETFs		879		847		880		872		2,551		2,589
Non-ETF Index		163		164		164		168		505		495
Equity subtotal		1,440		1,386		1,501		1,431		4,292		4,235
Fixed income:
Active		481		457		498		496		1,443		1,427
iShares ETFs		259		220		297		251		817		705
Non-ETF Index		112		97		113		98		354		293
Fixed income subtotal		852		774		908		845		2,614		2,425
Multi-asset		293		276		289		288		852		852
Alternatives:
Illiquid alternatives		148		110		140		122		416		350
Liquid alternatives		112		94		132		105		361		301
Currency and commodities⁽¹⁾		32		24		51		30		118		78
Alternatives subtotal		292		228		323		257		895		729
Long-Term		2,877		2,664		3,021		2,821		8,653		8,241
Cash management		178		141		204		159		593		447
Total base fees		3,055		2,805		3,225		2,980		9,246		8,688
Investment advisory performance fees:
Equity		2		—		4		1		29		5
Fixed income		2		2		9		—		13		2
Multi-asset		1		—		10		1		13		7
Alternatives:
Illiquid alternatives		17		20		6		5		55		40
Liquid alternatives		19		4		503		114		575		157
Alternatives subtotal		36		24		509		119		630		197
Total performance fees		41		26		532		121		685		211
Technology services revenue		274		204		282		259		834		700
Distribution fees:
Retrocessions		169		161		188		166		519		491
12b-1 fees (US mutual fund distribution fees)		91		89		85		90		254		267
Other		16		12		15		14		44		41
Total distribution fees		276		262		288		270		817		799
Advisory and other revenue:
Advisory		17		19		14		21		48		62
Other		47		30		28		41		97		102
Total advisory and other revenue		64		49		42		62		145		164
Total revenue	$	3,710	$	3,346	$	4,369	$	3,692	$	11,727	$	10,562

The tables below present the investment advisory, administration fees and securities lending revenue by client type and investment style:

	Three Months Ended				Three Months Ended				Nine Months Ended
	March 31,				September 30,				September 30,
(in millions)	2020		2019		2020		2019		2020		2019
By client type:
Retail	$	872	$	826	$	938	$	862	$	2,635	$	2,534
iShares ETFs		1,170		1,091		1,228		1,151		3,487		3,370
Institutional:
Active		574		500		594		558		1,714		1,595
Index		261		247		261		250		817		742
Total institutional		835		747		855		808		2,531		2,337
Long-Term		2,877		2,664		3,021		2,821		8,653		8,241
Cash management		178		141		204		159		593		447
Total	$	3,055	$	2,805	$	3,225	$	2,980	$	9,246	$	8,688

By investment style:
Active	$	1,427	$	1,307	$	1,511	$	1,401	$	4,292	$	4,073
Index and iShares ETFs		1,450		1,357		1,510		1,420		4,361		4,168
Long-Term		2,877		2,664		3,021		2,821		8,653		8,241
Cash management		178		141		204		159		593		447
Total	$	3,055	$	2,805	$	3,225	$	2,980	$	9,246	$	8,688

Investment advisory and administration fees – remaining performance obligation

The tables below present estimated investment advisory and administration fees expected to be recognized in the future related to the unsatisfied portion of the performance obligations at ~~March 31,~~September 30, 2020 and 2019:

	Remainder of												Remainder of
(in millions)	2020			2021		2022		2023	Thereafter		Total		2020			2021		2022		2023	Thereafter		Total
Investment advisory and administration fees:
Alternatives⁽¹⁾⁽²⁾	$	86	$	103	$	87	$	74	$	48	$	398	$	33	$	125	$	108	$	92	$	61	$	419

	Remainder of												Remainder of
(in millions)	2019			2020		2021		2022	Thereafter		Total		2019			2020		2021		2022	Thereafter		Total
Investment advisory and administration fees:
Alternatives⁽¹⁾⁽²⁾	$	56	$	68	$	55	$	46	$	43	$	268	$	22	$	85	$	71	$	62	$	59	$	299

The table below presents changes in the deferred carried interest liability, which is included in other liabilities on the condensed consolidated statements of financial condition, for the three and nine months ended ~~March 31,~~September 30, 2020 and 2019:

	Three Months Ended						Three Months Ended				Nine Months Ended
	March 31,						September 30,				September 30,
(in millions)	2020			2019			2020		2019		2020			2019
Beginning balance	$	483		$	293		$	418	$	365	$	483		$	293
Net increase (decrease) in unrealized allocations		62			51			29		17		4			116
Performance fee revenue recognized		(10	)		(17	)		—		—		(40	)		(27	)
Other								—		6		—			6
Ending balance	$	535		$	327		$	447	$	388	$	447		$	388

The tables below present estimated technology services revenue expected to be recognized in the future related to the unsatisfied portion of the performance obligations at ~~March 31,~~September 30, 2020 and 2019:

	Remainder of												Remainder of
(in millions)	2020			2021		2022		2023	Thereafter		Total		2020			2021		2022		2023	Thereafter		Total
Technology services revenue⁽¹⁾⁽²⁾	$	103	$	61	$	38	$	16	$	9	$	227	$	37	$	95	$	47	$	22	$	18	$	219

	Remainder of												Remainder of
(in millions)	2019			2020		2021		2022	Thereafter		Total		2019			2020		2021		2022	Thereafter		Total
Technology services revenue⁽¹⁾⁽²⁾	$	24	$	28	$	22	$	14	$	9	$	97	$	36	$	54	$	37	$	21	$	12	$	160

In addition to amounts disclosed in the tables above, certain technology services contracts require fixed minimum fees, which are billed on a monthly or quarterly basis in arrears. The Company recognizes such revenue as services are performed. As of ~~March 31,~~September 30, 2020, the estimated fixed minimum fees for the remainder of the year approximated ~~$490~~$170 million. The term for these contracts, which are either in their initial or renewal period, ranges from one to five years.

The table below presents changes in the technology services deferred revenue liability for the three and nine months ended ~~March 31,~~September 30, 2020 and 2019, which is included in other liabilities on the condensed consolidated statements of financial condition:

	Three Months Ended						Three Months Ended						Nine Months Ended
	March 31,						September 30,						September 30,
(in millions)	2020			2019			2020			2019			2020			2019
Beginning balance	$	116		$	70		$	108		$	100		$	116		$	70
Additions		30			11
Acquisition⁽¹⁾⁽²⁾								—			—			—			24
Additions ⁽²⁾								30			8			88			31
Revenue recognized that was included in the beginning balance		(32	)		(8	)		(33	)		(21	)		(99	)		(38	)
Ending balance	$	114		$	73		$	105		$	87		$	105		$	87

Restricted stock and restricted stock units (“RSUs”) activity for the ~~three~~nine months ended ~~March 31,~~September 30, 2020 is summarized below.

Outstanding at	Restricted Stock and RSUs			Weighted- Average Grant Date Fair Value		Restricted Stock and RSUs			Weighted- Average Grant Date Fair Value
December 31, 2019		2,236,452		$	444.02		2,236,452		$	444.02
Granted		905,542		$	533.48		948,904		$	532.60
Converted		(804,828	)	$	423.92		(923,213	)	$	427.06
Forfeited		(27,549	)	$	463.19		(68,668	)	$	476.96
March 31, 2020⁽¹⁾		2,309,617		$	485.87
September 30, 2020							2,193,475		$	488.44

In January 2020, the Company granted 504,403 RSUs or shares of restricted stock to employees as part of 2019 annual incentive compensation that vest ratably over three years from the date of grant and 393,161 RSUs or shares of restricted stock to employees that cliff vest 100% on January 31, 2023. The Company values restricted stock and RSUs at their grant-date fair value as measured by BlackRock’s common stock price. The total fair market value of RSUs/restricted stock granted to employees during the ~~three~~nine months ended ~~March 31,~~September 30, 2020 was ~~$483~~$505 million.

At ~~March 31,~~September 30, 2020, the intrinsic value of outstanding RSUs was ~~$1.0~~$1.2 billion, reflecting a closing stock price of ~~$439.97.~~$563.55.

At ~~March 31,~~September 30, 2020, total unrecognized stock-based compensation expense related to unvested RSUs was ~~$696~~$482 million. The unrecognized compensation cost is expected to be recognized over the remaining weighted-average period of ~~1.8~~1.3 years.

Performance-based RSU activity for the ~~three~~nine months ended ~~March 31,~~September 30, 2020 is summarized below.

Outstanding at	Performance- Based RSUs			Weighted- Average Grant Date Fair Value		Performance- Based RSUs			Weighted- Average Grant Date Fair Value
December 31, 2019		742,918		$	436.84		742,918		$	436.84
Granted		238,478		$	533.58		238,478		$	533.58
Additional shares granted due to attainment of performance measures		30,600		$	375.26		30,600		$	375.26
Converted		(311,779	)	$	375.26		(311,779	)	$	375.26
March 31, 2020		700,217		$	494.51
September 30, 2020							700,217		$	494.51

In January 2020, the Company granted 238,478 performance-based RSUs to certain employees that cliff vest 100% on January 31, 2023. These awards are amortized over a service period of three years. The number of shares distributed at vesting could be higher or lower than the original grant based on the level of attainment of predetermined Company performance measures. In January 2020, the Company also granted 30,600 additional RSUs related to prior awards to certain employees based on the attainment of Company performance measures during the performance period.

The Company initially values performance-based RSUs at their grant-date fair value as measured by BlackRock’s common stock price. The total grant-date fair market value of performance-based RSUs granted to employees during the ~~three~~nine months ended ~~March 31,~~September 30, 2020 was $139 million.

At ~~March 31,~~September 30, 2020, the intrinsic value of outstanding performance-based RSUs was ~~$308~~$395 million, reflecting a closing stock price of ~~$439.97.~~$563.55.

At ~~March 31,~~September 30, 2020, total unrecognized stock-based compensation expense related to unvested performance-based awards was ~~$241~~$158 million. The unrecognized compensation cost is expected to be recognized over the remaining weighted-average period ~~1.9~~of 1.4 years.

See Note 18, Stock-Based Compensation, in the 2019 Form 10-K for more information on performance-based RSUs.

Stock option activity for the ~~three~~nine months ended ~~March 31,~~September 30, 2020 is summarized below.

Outstanding at	Shares Under Option			Weighted Average Exercise Price		Shares Under Option			Weighted Average Exercise Price
December 31, 2019		1,941,145		$	513.50		1,941,145		$	513.50
Forfeited		(25,353	)	$	513.50		(25,353	)	$	513.50
March 31, 2020		1,915,792		$	513.50
September 30, 2020							1,915,792		$	513.50

At ~~March 31,~~September 30, 2020, total unrecognized stock-based compensation expense related to unvested performance-based stock options was ~~$105~~$90 million. The unrecognized compensation cost is expected to be recognized over the remaining weighted-average period of ~~3.7~~3.2 years.

See Note 18, Stock-Based Compensation, in the 2019 Form 10-K for more information on performance-based stock options.

The Company is required to maintain net capital in certain regulated subsidiaries within a number of jurisdictions, which is partially maintained by retaining cash and cash equivalent investments in those subsidiaries or jurisdictions. As a result, such subsidiaries of the Company may be restricted in their ability to transfer cash between different jurisdictions and to their parents. Additionally, transfers of cash between international jurisdictions may have adverse tax consequences that could discourage such transfers.

At ~~March 31,~~September 30, 2020, the Company was required to maintain approximately ~~$2.0~~$2.2 billion in net capital in certain regulated subsidiaries, including ~~BlackRock Institutional Trust Company, N.A.~~BTC (a wholly owned subsidiary of the Company that is chartered as a national bank whose powers are limited to trust and other fiduciary activities and which is subject to regulatory capital requirements administered by the US Office of the Comptroller of the Currency), entities regulated by the Financial Conduct Authority and Prudential Regulation Authority in the United Kingdom, and the Company’s broker-dealers. The Company was in compliance with all applicable regulatory net capital requirements.

The following table presents changes in accumulated other comprehensive income (loss) for the three and nine months ended ~~March 31,~~September 30, 2020 and 2019:

	Three Months Ended						Three Months Ended						Nine Months Ended
	March 31,						September 30,						September 30,
(in millions)	2020			2019			2020			2019			2020			2019
Beginning balance	$	(571	)	$	(691	)	$	(781	)	$	(664	)	$	(571	)	$	(691	)
Foreign currency translation adjustments⁽¹⁾		(239	)		68			180			(120	)		(30	)		(93	)
Ending balance	$	(810	)	$	(623	)	$	(601	)	$	(784	)	$	(601	)	$	(784	)

Nonvoting Participating Preferred Stock. The Company’s preferred shares authorized, issued and outstanding consisted of the following:

	March 31,		December 31,		September 30,		December 31,
	2020		2019		2020		2019
Series A
Shares authorized, $0.01 par value		20,000,000		20,000,000		20,000,000		20,000,000
Shares issued and outstanding		—		—		—		0
Series B
Shares authorized, $0.01 par value		150,000,000		150,000,000		150,000,000		150,000,000
Shares issued and outstanding⁽¹⁾		823,188		823,188		—		823,188
Series C
Shares authorized, $0.01 par value		6,000,000		6,000,000		6,000,000		6,000,000
Shares issued and outstanding		—		—		—		0
Series D
Shares authorized, $0.01 par value		20,000,000		20,000,000		20,000,000		20,000,000
Shares issued and outstanding		—		—		—		0

May 2020 PNC Secondary Offering and Share Repurchase. On May 15, 2020, a subsidiary of The PNC Financial Services Group, Inc. (“PNC”) completed the secondary offering of 31,628,573 shares of the Company’s common stock at a price of $420 per share, which included 823,188 shares of common stock issued upon the conversion of the Company’s Series B Convertible Participating Preferred Stock and 2,875,325 shares of common stock under the fully exercised underwriters’ option to purchase additional shares. Also on May 15, 2020, PNC completed the sale of 2,650,857 shares to the Company at a price of $414.96 per share. The shares repurchased by the Company were in addition to the share repurchase authorization under the Company’s existing share repurchase program. The secondary offering and the Company’s share repurchase resulted in PNC’s exit of its entire ownership position in the Company, other than 500,000 shares that PNC contributed to The PNC Foundation.

Share Repurchases. ~~The~~During the nine months ended September 30, 2020, the Company repurchased 0.8 million common shares in open market transactions under the share repurchase program for approximately ~~$400 million during the three months ended March 31, 2020.~~$412 million. At ~~March 31,~~September 30, 2020, there were 5.1 million shares still authorized to be repurchased. During the nine months ended September 30, 2020, the Company has repurchased an aggregate of approximately $1.5 billion of common shares, including the repurchase from PNC described above.

The ~~three~~nine months ended ~~March 31,~~September 30, 2020 income tax ~~benefit~~expense included a discrete tax benefit of $241 million recognized in connection with the Charitable ~~Contribution.~~

~~The three months ended March 31, 2020~~Contribution and ~~2019 income tax expense (benefit) included $64~~$78 million ~~and $23 million, respectively,~~ of discrete tax benefits, including benefits related to stock-based compensation awards that ~~vest~~vested in the first quarter of ~~each year.~~2020.

Income tax expense for the three and nine months ended September 30, 2020 also included a $54 million noncash net expense related to the revaluation of certain deferred tax assets and liabilities as a result of legislation enacted in the United Kingdom increasing its corporate tax rate.

Due to the similarities in terms between BlackRock nonvoting participating preferred stock and the Company’s common stock, the Company considers its participating preferred stock to be a common stock equivalent for purposes of earnings per share (“EPS”) calculations. As such, the Company has included ~~the~~any outstanding nonvoting participating preferred stock in the calculation of average basic and diluted shares outstanding. As of September 30, 2020, there were 0 shares of preferred stock outstanding.

The following table sets forth the computation of basic and diluted EPS for the three and nine months ended ~~March 31,~~September 30, 2020 and 2019 under the treasury stock method:

	Three Months Ended				Three Months Ended				Nine Months Ended
	March 31,				September 30,				September 30,
(in millions, except shares and per share data)	2020		2019		2020		2019		2020		2019
Net income attributable to BlackRock	$	806	$	1,053	$	1,364	$	1,119	$	3,384	$	3,175
Basic weighted-average shares outstanding		155,243,279		158,268,034		152,488,073		155,280,877		153,816,544		156,290,212
Dilutive effect of nonparticipating RSUs and stock options		1,173,447		1,080,397
Dilutive effect of nonparticipating RSUs						1,254,191		1,166,510		1,143,268		1,095,744
Total diluted weighted-average shares outstanding		156,416,726		159,348,431		153,742,264		156,447,387		154,959,812		157,385,956
Basic earnings per share	$	5.19	$	6.65	$	8.94	$	7.21	$	22.00	$	20.31
Diluted earnings per share	$	5.15	$	6.61	$	8.87	$	7.15	$	21.84	$	20.17

~~For the three months ended March 31, 2020, 603,639 RSUs were excluded from the calculation of diluted EPS because to include them would have an anti-dilutive effect.~~ The amount of anti-dilutive RSUs was immaterial for the three and nine months ended ~~March 31,~~September 30, 2020 and 2019. In addition, performance-based RSUs and stock options are excluded from potential dilution until the designated performance conditions are met.

The Company’s management directs BlackRock’s operations as 1 business, the asset management business. The Company utilizes a consolidated approach to assess performance and allocate resources. As such, the Company operates in one business segment.

The following table illustrates total revenue for the three and nine months ended ~~March 31,~~September 30, 2020 and 2019 by geographic region. These amounts are aggregated on a legal entity basis and do not necessarily reflect where the customer resides or affiliated services are provided.

	Three Months Ended				Three Months Ended				Nine Months Ended
(in millions)	March 31,				September 30,				September 30,
Revenue	2020		2019		2020		2019		2020		2019
Americas	$	2,480	$	2,240	$	2,631	$	2,445	$	7,581	$	7,051
Europe		1,067		943		1,574		1,080		3,661		3,018
Asia-Pacific		163		163		164		167		485		493
Total revenue	$	3,710	$	3,346	$	4,369	$	3,692	$	11,727	$	10,562

See Note 16, Revenue, for further information on the Company’s sources of revenue.

The following table illustrates long-lived assets that consist of goodwill and property and equipment at ~~March 31,~~September 30, 2020 and December 31, 2019 by geographic region. These amounts are aggregated on a legal entity basis and do not necessarily reflect where the asset is physically located.

(in millions)	March 31,		December 31,		September 30,		December 31,
Long-lived Assets	2020		2019		2020		2019
Americas	$	13,830	$	13,830	$	13,805	$	13,830
Europe		1,356		1,360		1,355		1,360
Asia-Pacific		87		87		87		87
Total long-lived assets	$	15,273	$	15,277	$	15,247	$	15,277

Americas is primarily comprised of the United States, Latin America and Canada, while Europe is primarily comprised of the United Kingdom, the Netherlands and Luxembourg. Asia-Pacific is primarily comprised of Hong Kong, Australia, Japan and Singapore.

~~In April~~Elimination of Preferred Stock. As a result of PNC’s exit of its entire ownership position in the Company, on October 6, 2020, the Company ~~issued $1.25 billion in aggregate principal amount~~filed a Certificate of ~~1.90% senior unsecured~~Elimination to its Amended and ~~unsubordinated notes maturing on January 28, 2031~~Restated Certificate of Incorporation (the ~~“2031 Notes”~~“Certificate of Incorporation”)~~. The net proceeds~~ with the Secretary of State for the state of Delaware eliminating each of the ~~2031 Notes will be used for general corporate purposes, which may include~~Company’s Series A, B and C Convertible Participating Preferred Stock and Series D Participating Preferred Stock (collectively, the ~~repayment~~“Preferred Stock”). As of ~~all or a portion~~October 6, 2020 (the date of filing the Certificate of Elimination), there were 0 outstanding shares of the $750 million 4.25% Notes due May 2021. Interest of approximately $24 million per year will be payable semi-annually on January 28 and July 28 of each year, commencing July 28, 2020. The 2031 Notes may be redeemed prior to October 28, 2030 in whole or in part at any time, at the option of the Company, at a “make-whole” redemption price or at 100% of the principal amount of the 2031 Notes thereafter. The discount and debt issuance costs will be amortized over the term of the 2031 Notes.

The Company conducted a review for additional subsequent events and determined that no subsequent events had occurred that would require accrual or additional disclosures.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This report, and other statements that BlackRock may make, may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act, with respect to BlackRock’s future financial or business performance, strategies or expectations. Forward-looking statements are typically identified by words or phrases such as “trend,” “potential,” “opportunity,” “pipeline,” “believe,” “comfortable,” “expect,” “anticipate,” “current,” “intention,” “estimate,” “position,” “assume,” “outlook,” “continue,” “remain,” “maintain,” “sustain,” “seek,” “achieve,” and similar expressions, or future or conditional verbs such as “will,” “would,” “should,” “could,” “may” and similar expressions.

BlackRock cautions that forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made, and BlackRock assumes no duty to and does not undertake to update forward-looking statements. Actual results could differ materially from those anticipated in forward-looking statements and future results could differ materially from historical performance.

BlackRock has previously disclosed risk factors in its Securities and Exchange Commission (“SEC”) reports. These risk factors and those identified elsewhere in this report, among others, could cause actual results to differ materially from forward-looking statements or historical performance and include: (1) a pandemic or health crisis, including the COVID-19 pandemic, and its impact on financial institutions, the global economy or capital markets, as well as BlackRock’s products, clients, vendors and employees, and BlackRock’s results of operations, the full extent of which may be unknown; (2) the introduction, withdrawal, success and timing of business initiatives and strategies; (3) changes and volatility in political, economic or industry conditions, the interest rate environment, foreign exchange rates or financial and capital markets, which could result in changes in demand for products or services or in the value of assets under management (“AUM”); (4) the relative and absolute investment performance of BlackRock’s investment products; (5) BlackRock’s ability to develop new products and services that address client preferences; (6) the impact of increased competition; (7) the impact of future acquisitions or divestitures; (8) BlackRock’s ability to integrate acquired businesses successfully; (9) the unfavorable resolution of legal proceedings; (10) the extent and timing of any share repurchases; (11) the impact, extent and timing of technological changes and the adequacy of intellectual property, information and cyber security protection; (12) attempts to circumvent BlackRock’s operational control environment or the potential for human error in connection with BlackRock’s operational systems; (13) the impact of legislative and regulatory actions and reforms and regulatory, supervisory or enforcement actions of government agencies relating to ~~BlackRock or The PNC Financial Services Group, Inc. (“PNC”);~~BlackRock; (14) changes in law and policy and uncertainty pending any such changes; (15) terrorist activities, international hostilities and natural disasters, which may adversely affect the general economy, domestic and local financial and capital markets, specific industries or BlackRock; (16) the ability to attract and retain highly talented professionals; (17) fluctuations in the carrying value of BlackRock’s economic investments; (18) the impact of changes to tax legislation, including income, payroll and transaction taxes, and taxation on products or transactions, which could affect the value proposition to clients and, generally, the tax position of the Company; (19) BlackRock’s success in negotiating distribution arrangements and maintaining distribution channels for its products; (20) the failure by a key vendor of BlackRock to fulfill its obligations to the Company; (21) any disruption to the operations of third parties whose functions are integral to BlackRock’s exchange-traded funds (“ETF”) platform; (22) the impact of BlackRock electing to provide support to its products from time to time and any potential liabilities related to securities lending or other indemnification obligations; and (23) the impact of problems at other financial institutions or the failure or negative performance of products at other financial institutions.

BlackRock, Inc. (together, with its subsidiaries, unless the context otherwise indicates, “BlackRock” or the “Company”) is a leading publicly traded investment management firm with ~~$6.47~~$7.81 trillion of AUM at ~~March 31,~~September 30, 2020. With approximately ~~16,300~~16,600 employees in more than 30 countries, BlackRock provides a broad range of investment management and technology services to institutional and retail clients worldwide.

BlackRock’s diverse platform of alpha-seeking active, index and cash management investment strategies across asset classes enables the Company to tailor investment outcomes and asset allocation solutions for clients. Product offerings include single- and multi-asset portfolios investing in equities, fixed income, alternatives and money market instruments. Products are offered directly and through intermediaries in a variety of vehicles, including open-end and closed-end mutual funds, iShares^® ETFs, separate accounts, collective ~~investment trusts~~trust funds and other pooled investment vehicles. BlackRock also offers technology services, including the investment and risk management technology platform, Aladdin^®, Aladdin Wealth, eFront, Cachematrix and FutureAdvisor, as well as advisory services and solutions to a broad base of institutional and wealth management clients.

BlackRock serves a diverse mix of institutional and retail clients across the globe. Clients include tax-exempt institutions, such as defined benefit and defined contribution pension plans, charities, foundations and endowments; official institutions, such as central banks, sovereign wealth funds, supranationals and other government entities; taxable institutions, including insurance companies, financial institutions, corporations and third-party fund ~~sponsors,~~sponsors; and retail investors.

BlackRock maintains a significant global sales and marketing presence that is focused on establishing and maintaining retail and institutional investment management and technology service relationships by marketing its services to investors directly and through third-party distribution relationships, including financial professionals and pension consultants.

~~At March 31,~~On May 15, 2020, a subsidiary of The PNC ~~held 22.0%~~Financial Services Group, Inc. (“PNC”) completed the secondary offering of 31,628,573 shares of the Company’s ~~voting~~ common stock ~~and 22.4%~~at a price of $420 per share, which included 823,188 shares of common stock issued upon the conversion of the Company’s ~~capital~~Series B Convertible Participating Preferred Stock and 2,875,325 shares of common stock ~~which includes outstanding common~~under the fully exercised underwriters’ option to purchase additional shares. Also on May 15, 2020, PNC completed the sale of 2,650,857 shares to the Company at a price of $414.96 per share. The shares repurchased by the Company were in addition to the share repurchase authorization under the Company’s existing share repurchase program. The secondary offering and ~~nonvoting preferred stock.~~the Company’s share repurchase resulted in PNC’s exit of its entire ownership position in the Company, other than 500,000 shares that PNC contributed to The PNC Foundation.

Certain prior period presentations and disclosures, while not required to be recast, were reclassified to ensure comparability with current period classifications.

The COVID-19 pandemic ~~has resulted~~continues to result in authorities ~~implementing~~taking numerous measures ~~attempting~~ to contain the spread and impact of COVID-19, such as travel bans and restrictions, quarantines, shelter in place orders, and limitations on business activity, including closures. These measures ~~are,~~may continue to, among other things, severely ~~restricting~~restrict global economic activity, which ~~is disrupting~~can disrupt supply chains, ~~lowering~~lower asset valuations, significantly ~~increasing~~increase unemployment and underemployment levels, ~~decreasing~~decrease liquidity in markets for certain securities and ~~causing~~cause significant volatility and disruption in the financial markets.

Towards the end of the first quarter of 2020 the pandemic began to impact our ~~business,~~business. While global markets have recovered to varying degrees since then, the effects of ~~which~~the pandemic are ongoing, and such impact ~~is expected to~~may continue in future quarters if conditions ~~persist.~~persist or worsen. Should current economic conditions persist or deteriorate, there may be an ongoing adverse effect on our business, including our operations and financial condition, as a result of, among other things:

The extent to which COVID-19, and the related global economic crisis, affect our business, results of operations and financial condition, will depend on future developments that are highly uncertain and cannot be predicted, including the scope and duration of the pandemic and any recovery period, future actions taken by governmental authorities, central banks and other third parties (including new financial regulation and other regulatory reform) in response to the pandemic, and the effects on our products, clients, vendors and employees. BlackRock continues to service clients amid uncertainty and disruption linked to COVID-19 and is actively managing its business to respond to the impact.

Following the June 2016 vote to exit the European Union (“EU”), commonly referred to as Brexit, the United Kingdom (“UK”) left the EU on January 31, 2020 and entered an eleven-month transition period during which the UK, and UK-based entities, will retain the rights and obligations of EU membership.

Substantial uncertainty remains surrounding the future relationship between the UK and the EU, but the UK government has indicated its preference for negotiating a trade deal with the EU before the end of the transition period rather than continuing Single Market or Customs Union membership. BlackRock is implementing a number of steps to prepare for various outcomes, including the potential failure of the UK and the EU to negotiate an agreement before the transition period expires. These steps, many of which are time consuming and costly, include effecting organizational, governance and operational changes, applying for and receiving licenses and permissions in the EU, and engaging in client communications, and are expected to add complexity to BlackRock’s European operations. In addition, depending on the terms of the future relationship between the UK and the EU, BlackRock may experience further organizational and operational challenges and incur additional costs in connection with its European operations during the transition period and post-Brexit, which may impede the Company’s growth or impact its financial performance.

On February 13, 2020, BlackRock announced the establishment of The BlackRock Foundation (the “Foundation”) and the contribution of its remaining 20% stake in PennyMac Financial Services, Inc. (“PennyMac”) to the Foundation and the BlackRock Charitable Fund, which BlackRock established in 2013 (together, the “Charitable Contribution”). The Charitable Contribution resulted in an operating expense of $589 million, which was offset by a $122 million noncash, nonoperating pre-tax gain on the contributed shares and a tax benefit of $241 million in the condensed consolidated statement of income for the ~~three~~nine months ended ~~March 31,~~September 30, 2020. The Charitable Contribution ~~will provide~~provides long-term funding for BlackRock’s philanthropic investments and partnerships. The general and administration expense, nonoperating gain and associated tax benefit related to the Charitable Contribution have been excluded from as adjusted results.

	Three Months Ended						Three Months Ended						Nine Months Ended
	March 31,						September 30,						September 30,
(in millions, except shares and per share data)	2020			2019			2020			2019			2020			2019
GAAP basis:
Total revenue	$	3,710		$	3,346		$	4,369		$	3,692		$	11,727		$	10,562
Total expense		3,026			2,113			2,612			2,190			7,880			6,549
Operating income	$	684		$	1,233		$	1,757		$	1,502		$	3,847		$	4,013
Operating margin		18.4	%		36.8	%		40.2	%		40.7	%		32.8	%		38.0	%
Nonoperating income (expense), less net income (loss) attributable to noncontrolling interests		108			118			71			(42	)		348			123
Income tax benefit (expense)		14			(298	)		(464	)		(341	)		(811	)		(961	)
Net income attributable to BlackRock	$	806		$	1,053		$	1,364		$	1,119		$	3,384		$	3,175
Diluted earnings per common share	$	5.15		$	6.61		$	8.87		$	7.15		$	21.84		$	20.17
Effective tax rate		(1.7)	%		22.1	%		25.4	%		23.3	%		19.3	%		23.2	%
As adjusted⁽¹⁾:
Operating income	$	1,273		$	1,233		$	1,757		$	1,502		$	4,436		$	4,013
Operating margin		41.7	%		41.9	%		47.0	%		46.0	%		44.3	%		43.7	%
Nonoperating income (expense), less net income (loss) attributable to noncontrolling interests	$	(14	)	$	118		$	71		$	(42	)	$	226		$	123
Net income attributable to BlackRock	$	1,032		$	1,053		$	1,418		$	1,119		$	3,664		$	3,175
Diluted earnings per common share	$	6.60		$	6.61		$	9.22		$	7.15		$	23.64		$	20.17
Effective tax rate		18.0	%		22.1	%		22.5	%		23.3	%		21.4	%		23.2	%
Other:
Assets under management (end of period)	$	6,466,668		$	6,515,345		$	7,808,497		$	6,963,932		$	7,808,497		$	6,963,932
Diluted weighted-average common shares outstanding⁽²⁾		156,416,726			159,348,431			153,742,264			156,447,387			154,959,812			157,385,956
Common and preferred shares outstanding (end of period)		155,085,806			155,323,503
Shares outstanding (end of period)								152,496,403			155,173,103			152,496,403			155,173,103
Book value per share⁽³⁾	$	212.87		$	201.57		$	222.12		$	208.84		$	222.12		$	208.84
Cash dividends declared and paid per share	$	3.63		$	3.30		$	3.63		$	3.30		$	10.89		$	9.90

THREE MONTHS ENDED ~~MARCH 31,~~SEPTEMBER 30, 2020 COMPARED WITH THREE MONTHS ENDED ~~MARCH 31,~~SEPTEMBER 30, 2019

GAAP. Operating income of ~~$684~~$1,757 million increased $255 million and operating margin of ~~18.4%~~40.2% decreased ~~$549 million and 1,840~~50 bps ~~respectively,~~ from the ~~first~~third quarter of 2019. Operating income and operating margin reflected higher ~~base~~performance fees and continued organic growth, partially offset by higher employee compensation and benefits expense and the impact of $83 million of product launch costs associated with the September 2020 close of the $2 billion BlackRock Capital Allocation Trust. Nonoperating income (expense) less net income (loss) attributable to noncontrolling interests (“NCI”) increased $113 million from the third quarter of 2019, primarily driven by mark-to-market gains on un-hedged seed and co-investment capital.

Income tax expense for the third quarter of 2020 included a $54 million noncash net expense, related to the revaluation of certain deferred tax assets and liabilities as a result of legislation enacted in the United Kingdom increasing its corporate tax rate.

Earnings per diluted common share increased $1.72, or 24%, from the third quarter of 2019, driven primarily by higher operating and nonoperating income and a lower diluted share count in the current quarter.

As Adjusted. Operating margin of 47.0% increased 100 bps from the third quarter of 2019. Income tax expense for the third quarter of 2020 excluded the $54 million noncash net expense described above. Earnings per diluted common share increased $2.07, or 27%, from the third quarter of 2019.

NINE MONTHS ENDED SEPTEMBER 30, 2020 COMPARED WITH NINE MONTHS ENDED SEPTEMBER 30, 2019

GAAP.Operating income of $3,847 million decreased $166 million and operating margin of 32.8% decreased 520 bps from the nine months ended September 30, 2019. Operating income and operating margin reflected higher investment advisory, administration fees and securities lending revenue (collectively “base fees”), performance fees and technology services revenue, which were more than offset by higher expense, ~~primarily due to~~including the impact of $589 million related to the Charitable Contribution and ~~$84 million of~~higher product launch costs ~~associated with~~for the ~~January 2020 close of the $2.3 billion BlackRock Health Sciences Trust II.~~nine months ended September 30, 2020.

Nonoperating income (expense) less net income (loss) attributable to ~~noncontrolling interests (“NCI”) decreased $10~~NCI increased $225 million from the ~~first quarter of~~nine months ended September 30, 2019, ~~primarily~~ driven ~~by mark-to-market losses on un-hedged seed capital investments and a corporate minority investment, partially offset~~ by the impact of a pre-tax gain of approximately $240 million in connection with a recapitalization of iCapital Network, Inc. (“iCapital”)~~. Non-operating results also reflected the~~ and $122 million pre-tax gain related to the Charitable ~~Contribution.~~Contribution, partially offset by lower mark-to-market gains on un-hedged seed capital investments for the nine months ended September 30, 2020.

Income tax ~~benefit (expense)~~expense for the nine months ended September 30, 2020 included $78 million of discrete tax benefits, including benefits related to stock-based compensation awards that vested in the first quarter of 2020. Income tax expense for the nine months ended September 30, 2020 included a discrete tax benefit of $241 million recognized in connection with the Charitable ~~Contribution. First quarter 2020~~Contribution and ~~2019 income tax~~a noncash net expense ~~(benefit) included $64~~of approximately $54 million ~~and $23 million, respectively, of discrete tax benefits, including benefits~~ related to ~~stock-based compensation awards that vest~~the legislation enacted in the ~~first quarter of each year.~~ United Kingdom described above. See Income Tax Expense within Discussion of Financial Results for more information.

Earnings per diluted common share ~~decreased $1.46, or 22%,~~increased $1.67 from the ~~first quarter of~~nine months ended September 30, 2019, reflecting ~~the impact of the Charitable Contribution~~higher revenue and ~~product launch costs, partially offset by higher revenue,~~nonoperating income, a lower effective tax rate and a lower diluted share count, inpartially offset by the ~~current quarter~~impact of the Charitable Contribution and higher product launch costs for the nine months ended September 30, 2020.

As Adjusted. Operating income of ~~$1,273~~$4,436 million increased ~~$40~~$423 million and operating margin of 44.3% increased 60 bps from the ~~first quarter of~~nine months ended September 30, 2019. Earnings per diluted common share ~~were essentially flat compared~~increased $3.47, or 17%, from the nine months ended September 30, 2019, primarily due to ~~the first quarter of 2019 as~~ higher operating and nonoperating income, a lower effective tax rate and a lower diluted share count in the ~~current quarter, were more than offset by lower nonoperating income versus a year ago~~nine months ended September 30, 2020. The financial impact related to the Charitable Contribution and legislation enacted in the UK increasing its tax rate has been excluded from as adjusted results.

See Non-GAAP Financial Measures for further information on as adjusted items and the reconciliation to accounting principles generally accepted in the United States (“GAAP“).

For further discussion of BlackRock’s revenue, expense, nonoperating results and income tax expense, see Discussion of Financial Results herein.

BlackRock reports its financial results in accordance with GAAP; however, management believes evaluating the Company’s ongoing operating results may be enhanced if investors have additional non-GAAP financial measures. Management reviews non-GAAP financial measures to assess ongoing operations and considers them to be helpful, for both management and investors, in evaluating BlackRock’s financial performance over time. Management also uses non-GAAP financial measures as a benchmark to compare its performance with other companies and to enhance the comparability of this information for the reporting periods presented. Non-GAAP measures may pose limitations because they do not include all of BlackRock’s revenue and expense. BlackRock’s management does not advocate that investors consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Non-GAAP measures may not be comparable to other similarly titled measures of other companies.

Management uses both GAAP and non-GAAP financial measures in evaluating BlackRock’s financial performance. Adjustments to GAAP financial measures (“non-GAAP adjustments”) include certain items management deems nonrecurring or that occur infrequently, transactions that ultimately will not impact BlackRock’s book value or certain tax items that do not impact cash flow.

Computations for all periods are derived from the condensed consolidated statements of income as follows:

	Three Months Ended						Three Months Ended						Nine Months Ended
	March 31,						September 30,						September 30,
(in millions)	2020			2019			2020			2019			2020			2019
Operating income, GAAP basis	$	684		$	1,233		$	1,757		$	1,502		$	3,847		$	4,013
Non-GAAP expense adjustment:
Charitable Contribution		589			—			—			—			589			—
Operating income, as adjusted		1,273			1,233			1,757			1,502			4,436			4,013
Product launch costs and commissions		87			—			83			—			170			61
Operating income used for operating margin measurement	$	1,360		$	1,233		$	1,840		$	1,502		$	4,606		$	4,074
Revenue, GAAP basis	$	3,710		$	3,346		$	4,369		$	3,692		$	11,727		$	10,562
Non-GAAP adjustments:
Distribution fees		(276	)		(262	)		(288	)		(270	)		(817	)		(799	)
Investment advisory fees		(169	)		(142	)		(168	)		(157	)		(513	)		(448	)
Revenue used for operating margin measurement	$	3,265		$	2,942		$	3,913		$	3,265		$	10,397		$	9,315
Operating margin, GAAP basis		18.4	%		36.8	%		40.2	%		40.7	%		32.8	%		38.0	%
Operating margin, as adjusted		41.7	%		41.9	%		47.0	%		46.0	%		44.3	%		43.7	%

Management believes operating income, as adjusted, and operating margin, as adjusted, are effective indicators of BlackRock’s financial performance over time, and, therefore, provide useful disclosure to investors. Management believes that operating margin, as adjusted, reflects the Company’s long-term ability to manage ongoing costs in relation to its revenues. The Company uses operating margin, as adjusted, to assess the Company’s financial performance and to determine the long-term and annual compensation of the Company’s senior-level employees. Furthermore, this metric is used to evaluate the Company’s relative performance against industry peers, as it eliminates margin variability arising from the accounting of revenues and expenses related to distributing different product structures in multiple distribution channels utilized by asset managers.

(2) Nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted:

	Three Months Ended					Three Months Ended					Nine Months Ended
	March 31,					September 30,					September 30,
(in millions)	2020			2019		2020		2019			2020		2019
Nonoperating income (expense), GAAP basis	$	(71	)	$	125	$	224	$	(42	)	$	510	$	140
Less: Net income (loss) attributable to NCI		(179	)		7		153		—			162		17
Nonoperating income (expense), net of NCI		108			118		71		(42	)		348		123
Less: Gain related to the Charitable Contribution		122			—		—		—			122		—
Nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted	$	(14	)	$	118	$	71	$	(42	)	$	226	$	123

Management believes nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, is an effective measure for reviewing BlackRock’s nonoperating contribution to its results and provides comparability of this information among reporting periods. Management believes nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, provides a useful measure, for both management and investors, of BlackRock’s nonoperating results, which ultimately impact BlackRock’s book value. ~~The~~During the nine months ended September 30, 2020, the noncash, nonoperating pre-tax gain of $122 million related to the Charitable Contribution has been excluded from nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, due to its nonrecurring nature.

Management believes net income attributable to BlackRock, Inc., as adjusted, and diluted earnings per common share, as adjusted, are useful measures of BlackRock’s profitability and financial performance. Net income attributable to BlackRock, Inc., as adjusted, equals net income attributable to BlackRock, Inc., GAAP basis, adjusted for significant nonrecurring items, charges that ultimately will not impact BlackRock’s book value or certain tax items that do not impact cash flow.

See aforementioned discussion regarding operating income, as adjusted, operating margin, as adjusted, and nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, for information on the Charitable Contribution.

The ~~three~~nine months ended ~~March 31,~~September 30, 2020 included a discrete tax benefit of $241 million recognized in connection with the Charitable Contribution. The discrete tax benefit has been excluded from as adjusted results due to the non-recurring nature of the Charitable Contribution. Amounts for income tax matters represent net noncash (benefits) expense primarily associated with the revaluation of certain deferred tax liabilities related to intangible assets and goodwill as a result of tax rate changes. These amounts have been excluded from the as adjusted results as these items will not have a cash flow impact and to ensure comparability among periods presented.

Per share amounts reflect net income attributable to BlackRock, Inc., as adjusted divided by diluted weighted average common shares outstanding.

(4) Nonvoting participating preferred stock is considered to be a common stock equivalent for purposes of determining basic and diluted earnings per share calculations.

AUM for reporting purposes generally is based upon how investment advisory and administration fees are calculated for each portfolio. Net asset values, total assets, committed assets or other measures may be used to determine portfolio AUM.

AUM and Net Inflows (Outflows) by Client Type and Product Type	AUM and Net Inflows (Outflows) by Client Type and Product Type												AUM and Net Inflows (Outflows) by Client Type and Product Type
	AUM						Net inflows (outflows)						AUM								Net inflows (outflows)
	March 31,		December 31,		March 31,		Three Months Ended March 31,			Twelve Months Ended March 31,			September 30,		June 30,		December 31,		September 30,		Three Months Ended September 30,		Nine Months Ended September 30,			Twelve Months Ended September 30,
(in millions)	2020		2019		2019		2020			2020			2020		2020		2019		2019		2020		2020			2020
Retail	$	608,824	$	703,297	$	646,355	$	(1,524	)	$	15,096		$	746,264	$	695,154	$	703,297	$	668,118	$	19,552	$	34,236		$	42,246
iShares ETFs		1,852,190		2,240,065		1,924,710		13,830			166,635			2,321,335		2,162,597		2,240,065		2,046,818		41,332		106,133			181,335
Institutional:
Active		1,230,092		1,338,670		1,160,150		(1,862	)		82,229			1,427,122		1,341,610		1,338,670		1,283,064		29,619		30,270			45,567
Index		2,178,499		2,599,882		2,327,080		(29,103	)		(5,957	)		2,641,408		2,482,336		2,599,882		2,453,181		7,101		(29,488	)		(28,961	)
Institutional subtotal		3,408,591		3,938,552		3,487,230		(30,965	)		76,272			4,068,530		3,823,946		3,938,552		3,736,245		36,720		782			16,606
Long-term		5,869,605		6,881,914		6,058,295		(18,659	)		258,003			7,136,129		6,681,697		6,881,914		6,451,181		97,604		141,151			240,187
Cash management		594,089		545,949		455,271		52,441			139,849			652,002		619,351		545,949		510,984		27,766		104,405			134,204
Advisory⁽¹⁾		2,974		1,770		1,779		1,206			1,207			20,366		16,901		1,770		1,767		3,331		18,350			18,353
Total	$	6,466,668	$	7,429,633	$	6,515,345	$	34,988		$	399,059		$	7,808,497	$	7,317,949	$	7,429,633	$	6,963,932	$	128,701	$	263,906		$	392,744

AUM and Net Inflows (Outflows) by Investment Style and Product Type	AUM and Net Inflows (Outflows) by Investment Style and Product Type												AUM and Net Inflows (Outflows) by Investment Style and Product Type
	AUM						Net inflows (outflows)						AUM								Net inflows (outflows)
	March 31,		December 31,		March 31,		Three Months Ended March 31,			Twelve Months Ended March 31,			September 30,		June 30,		December 31,		September 30,		Three Months Ended September 30,		Nine Months Ended September 30,			Twelve Months Ended September 30,
(in millions)	2020		2019		2019		2020			2020			2020		2020		2019		2019		2020		2020			2020
Active	$	1,758,548	$	1,947,222	$	1,724,875	$	(8,944	)	$	87,343		$	2,072,673	$	1,943,828	$	1,947,222	$	1,865,437	$	47,059	$	56,675		$	77,242
Index and iShares ETFs		4,111,057		4,934,692		4,333,420		(9,715	)		170,660			5,063,456		4,737,869		4,934,692		4,585,744		50,545		84,476			162,945
Long-term		5,869,605		6,881,914		6,058,295		(18,659	)		258,003			7,136,129		6,681,697		6,881,914		6,451,181		97,604		141,151			240,187
Cash management		594,089		545,949		455,271		52,441			139,849			652,002		619,351		545,949		510,984		27,766		104,405			134,204
Advisory⁽¹⁾		2,974		1,770		1,779		1,206			1,207			20,366		16,901		1,770		1,767		3,331		18,350			18,353
Total	$	6,466,668	$	7,429,633	$	6,515,345	$	34,988		$	399,059		$	7,808,497	$	7,317,949	$	7,429,633	$	6,963,932	$	128,701	$	263,906		$	392,744

AUM and Net Inflows (Outflows) by Product Type	AUM and Net Inflows (Outflows) by Product Type												AUM and Net Inflows (Outflows) by Product Type
	AUM						Net inflows (outflows)						AUM								Net inflows (outflows)
	March 31,		December 31,		March 31,		Three Months Ended March 31,			Twelve Months Ended March 31,			September 30,		June 30,		December 31,		September 30,		Three Months Ended September 30,		Nine Months Ended September 30,			Twelve Months Ended September 30,
(in millions)	2020		2019		2019		2020			2020			2020		2020		2019		2019		2020		2020			2020
Equity	$	2,959,662	$	3,820,329	$	3,375,885	$	3,162		$	57,594		$	3,784,118	$	3,519,225	$	3,820,329	$	3,488,503	$	2,168	$	916		$	39,517
Fixed income		2,235,815		2,315,392		2,029,966		(35,372	)		148,285			2,531,465		2,411,092		2,315,392		2,267,431		70,362		95,257			133,531
Multi-asset		494,177		568,121		499,520		4,391			24,934			598,246		551,362		568,121		527,721		13,980		13,616			28,572
Alternatives:
Illiquid alternatives		75,101		75,349		66,462		2,568			10,733			79,723		76,607		75,349		70,516		2,202		6,354			10,420
Liquid alternatives		58,127		59,048		53,118		1,560			5,615			69,255		63,120		59,048		55,544		2,553		5,509			7,804
Currency and commodities⁽²⁾		46,723		43,675		33,344		5,032			10,842			73,322		60,291		43,675		41,466		6,339		19,499			20,343
Alternatives subtotal		179,951		178,072		152,924		9,160			27,190			222,300		200,018		178,072		167,526		11,094		31,362			38,567
Long-term		5,869,605		6,881,914		6,058,295		(18,659	)		258,003			7,136,129		6,681,697		6,881,914		6,451,181		97,604		141,151			240,187
Cash management		594,089		545,949		455,271		52,441			139,849			652,002		619,351		545,949		510,984		27,766		104,405			134,204
Advisory⁽¹⁾		2,974		1,770		1,779		1,206			1,207			20,366		16,901		1,770		1,767		3,331		18,350			18,353
Total	$	6,466,668	$	7,429,633	$	6,515,345	$	34,988		$	399,059		$	7,808,497	$	7,317,949	$	7,429,633	$	6,963,932	$	128,701	$	263,906		$	392,744

Component Changes in AUM for the Three Months Ended ~~March 31,~~September 30, 2020

The following table presents the component changes in AUM by client type and product type for the three months ended ~~March 31,~~September 30, 2020.

	December 31,		Net inflows			Market			FX			March 31,		Average		June 30,		Net inflows			Market			FX		September 30,		Average
(in millions)	2019		(outflows)			change			impact⁽¹⁾			2020		AUM⁽²⁾		2020		(outflows)			change			impact⁽¹⁾		2020		AUM⁽²⁾
Retail:
Equity	$	252,413	$	9,103		$	(52,981	)	$	(3,793	)	$	204,742	$	237,927	$	254,104	$	7,007		$	15,217		$	3,099	$	279,427	$	272,429
Fixed income		305,265		(8,412	)		(14,699	)		(4,097	)		278,057		301,616		301,160		8,321			4,185			2,342		316,008		311,193
Multi-asset		120,439		(3,557	)		(15,177	)		(673	)		101,032		114,423		111,934		1,777			5,618			379		119,708		117,376
Alternatives		25,180		1,342			(1,364	)		(165	)		24,993		25,917		27,956		2,447			523			195		31,121		29,759
Retail subtotal		703,297		(1,524	)		(84,221	)		(8,728	)		608,824		679,883		695,154		19,552			25,543			6,015		746,264		730,757
iShares ETFs:
Equity		1,632,972		10,448			(380,268	)		(9,462	)		1,253,690		1,496,807		1,470,314		14,851			96,101			5,583		1,586,849		1,560,887
Fixed income		565,790		(1,637	)		(6,410	)		(3,734	)		554,009		572,594		634,098		19,690			5,206			4,005		662,999		657,594
Multi-asset		5,210		24			(693	)		(42	)		4,499		5,007		5,074		154			192			10		5,430		5,297
Alternatives		36,093		4,995			(1,030	)		(66	)		39,992		38,630		53,111		6,637			6,254			55		66,057		63,687
iShares ETFs subtotal		2,240,065		13,830			(388,401	)		(13,304	)		1,852,190		2,113,038		2,162,597		41,332			107,753			9,653		2,321,335		2,287,465
Institutional:
Active:
Equity		141,118		1,023			(27,278	)		(2,423	)		112,440		130,260		133,932		4,001			9,709			1,618		149,260		145,197
Fixed income		651,368		(13,908	)		(6,073	)		(6,042	)		625,345		651,318		666,693		12,011			9,122			5,235		693,061		684,720
Multi-asset		434,233		8,194			(53,293	)		(7,718	)		381,416		420,907		426,553		11,354			20,017			6,318		464,242		451,984
Alternatives		111,951		2,829			(2,280	)		(1,609	)		110,891		111,840		114,432		2,253			2,481			1,393		120,559		118,016
Active subtotal		1,338,670		(1,862	)		(88,924	)		(17,792	)		1,230,092		1,314,325		1,341,610		29,619			41,329			14,564		1,427,122		1,399,917
Index:
Equity		1,793,826		(17,412	)		(366,413	)		(21,211	)		1,388,790		1,643,893		1,660,875		(23,691	)		115,515			15,883		1,768,582		1,748,988
Fixed income		792,969		(11,415	)		23,048			(26,198	)		778,404		803,570		809,141		30,340			(2,967	)		22,883		859,397		846,244
Multi-asset		8,239		(270	)		(730	)		(9	)		7,230		8,146		7,801		695			285			85		8,866		8,245
Alternatives		4,848		(6	)		(695	)		(72	)		4,075		4,499		4,519		(243	)		211			76		4,563		4,637
Index subtotal		2,599,882		(29,103	)		(344,790	)		(47,490	)		2,178,499		2,460,108		2,482,336		7,101			113,044			38,927		2,641,408		2,608,114
Institutional subtotal		3,938,552		(30,965	)		(433,714	)		(65,282	)		3,408,591		3,774,433		3,823,946		36,720			154,373			53,491		4,068,530		4,008,031
Long-term		6,881,914		(18,659	)		(906,336	)		(87,314	)		5,869,605		6,567,354		6,681,697		97,604			287,669			69,159		7,136,129		7,026,253
Cash management		545,949		52,441			(260	)		(4,041	)		594,089		555,263		619,351		27,766			274			4,611		652,002		632,869
Advisory⁽³⁾		1,770		1,206	��		49			(51	)		2,974		2,094		16,901		3,331			124			10		20,366		19,025
Total	$	7,429,633	$	34,988		$	(906,547	)	$	(91,406	)	$	6,466,668	$	7,124,711	$	7,317,949	$	128,701		$	288,067		$	73,780	$	7,808,497	$	7,678,147

The following table presents the component changes in AUM by investment style and product type for the three months ended ~~March 31,~~September 30, 2020.

	December 31,		Net inflows			Market			FX			March 31,		Average		June 30,		Net inflows			Market			FX		September 30,		Average
(in millions)	2019		(outflows)			change			impact⁽¹⁾			2020		AUM⁽²⁾		2020		(outflows)			change			impact⁽¹⁾		2020		AUM⁽²⁾
Active:
Equity	$	316,145	$	3,907		$	(63,277	)	$	(4,017	)	$	252,758	$	294,863	$	312,809	$	10,063		$	21,603		$	3,156	$	347,631	$	338,125
Fixed income		939,275		(21,660	)		(20,835	)		(9,322	)		887,458		935,636		950,143		19,166			13,135			6,968		989,412		976,832
Multi-asset		554,672		4,638			(68,469	)		(8,391	)		482,450		535,329		538,489		13,131			25,635			6,697		583,952		569,360
Alternatives		137,130		4,171			(3,645	)		(1,774	)		135,882		137,756		142,387		4,699			3,003			1,589		151,678		147,775
Active subtotal		1,947,222		(8,944	)		(156,226	)		(23,504	)		1,758,548		1,903,584		1,943,828		47,059			63,376			18,410		2,072,673		2,032,092
Index and iShares ETFs:
iShares ETFs:
Equity		1,632,972		10,448			(380,268	)		(9,462	)		1,253,690		1,496,807		1,470,314		14,851			96,101			5,583		1,586,849		1,560,887
Fixed income		565,790		(1,637	)		(6,410	)		(3,734	)		554,009		572,594		634,098		19,690			5,206			4,005		662,999		657,594
Multi-asset		5,210		24			(693	)		(42	)		4,499		5,007		5,074		154			192			10		5,430		5,297
Alternatives		36,093		4,995			(1,030	)		(66	)		39,992		38,630		53,111		6,637			6,254			55		66,057		63,687
iShares ETFs subtotal		2,240,065		13,830			(388,401	)		(13,304	)		1,852,190		2,113,038		2,162,597		41,332			107,753			9,653		2,321,335		2,287,465
Non-ETF Index:
Equity		1,871,212		(11,193	)		(383,395	)		(23,410	)		1,453,214		1,717,217		1,736,102		(22,746	)		118,838			17,444		1,849,638		1,828,489
Fixed income		810,327		(12,075	)		23,111			(27,015	)		794,348		820,868		826,851		31,506			(2,795	)		23,492		879,054		865,325
Multi-asset		8,239		(271	)		(731	)		(9	)		7,228		8,147		7,799		695			285			85		8,864		8,245
Alternatives		4,849		(6	)		(694	)		(72	)		4,077		4,500		4,520		(242	)		212			75		4,565		4,637
Non-ETF Index subtotal		2,694,627		(23,545	)		(361,709	)		(50,506	)		2,258,867		2,550,732		2,575,272		9,213			116,540			41,096		2,742,121		2,706,696
Index & iShares ETFs subtotal		4,934,692		(9,715	)		(750,110	)		(63,810	)		4,111,057		4,663,770		4,737,869		50,545			224,293			50,749		5,063,456		4,994,161
Long-term		6,881,914		(18,659	)		(906,336	)		(87,314	)		5,869,605		6,567,354		6,681,697		97,604			287,669			69,159		7,136,129		7,026,253
Cash management		545,949		52,441			(260	)		(4,041	)		594,089		555,263		619,351		27,766			274			4,611		652,002		632,869
Advisory⁽³⁾		1,770		1,206			49			(51	)		2,974		2,094		16,901		3,331			124			10		20,366		19,025
Total	$	7,429,633	$	34,988		$	(906,547	)	$	(91,406	)	$	6,466,668	$	7,124,711	$	7,317,949	$	128,701		$	288,067		$	73,780	$	7,808,497	$	7,678,147

The following table presents the component changes in AUM by product type for the three months ended ~~March 31,~~September 30, 2020.

	December 31,		Net inflows			Market			FX			March 31,		Average		June 30,		Net inflows		Market		FX		September 30,		Average
(in millions)	2019		(outflows)			change			impact⁽¹⁾			2020		AUM⁽²⁾		2020		(outflows)		change		impact⁽¹⁾		2020		AUM⁽²⁾
Equity	$	3,820,329	$	3,162		$	(826,940	)	$	(36,889	)	$	2,959,662	$	3,508,887	$	3,519,225	$	2,168	$	236,542	$	26,183	$	3,784,118	$	3,727,501
Fixed income		2,315,392		(35,372	)		(4,134	)		(40,071	)		2,235,815		2,329,098		2,411,092		70,362		15,546		34,465		2,531,465		2,499,751
Multi-asset		568,121		4,391			(69,893	)		(8,442	)		494,177		548,483		551,362		13,980		26,112		6,792		598,246		582,902
Alternatives:
Illiquid alternatives		75,349		2,568			(1,765	)		(1,051	)		75,101		75,305		76,607		2,202		104		810		79,723		78,413
Liquid alternatives		59,048		1,560			(1,743	)		(738	)		58,127		59,763		63,120		2,553		2,851		731		69,255		66,642
Currency and commodities⁽⁴⁾		43,675		5,032			(1,861	)		(123	)		46,723		45,818		60,291		6,339		6,514		178		73,322		71,044
Alternatives subtotal		178,072		9,160			(5,369	)		(1,912	)		179,951		180,886		200,018		11,094		9,469		1,719		222,300		216,099
Long-term		6,881,914		(18,659	)		(906,336	)		(87,314	)		5,869,605		6,567,354		6,681,697		97,604		287,669		69,159		7,136,129		7,026,253
Cash management		545,949		52,441			(260	)		(4,041	)		594,089		555,263		619,351		27,766		274		4,611		652,002		632,869
Advisory⁽³⁾		1,770		1,206			49			(51	)		2,974		2,094		16,901		3,331		124		10		20,366		19,025
Total	$	7,429,633	$	34,988		$	(906,547	)	$	(91,406	)	$	6,466,668	$	7,124,711	$	7,317,949	$	128,701	$	288,067	$	73,780	$	7,808,497	$	7,678,147

AUM ~~decreased $963.0~~increased $490.5 billion to ~~$6.47~~$7.81 trillion at ~~March 31,~~September 30, 2020, driven by net market ~~depreciation~~appreciation, positive net inflows and the ~~negative~~positive impact of foreign exchange ~~movements, partially offset by positive net inflows.~~movements.

Net market ~~depreciation~~appreciation of ~~$906.5~~$288.1 billion was primarily driven by ~~declines in~~ global equity ~~markets.~~market appreciation.

Long-term net ~~outflows~~inflows of ~~$18.7~~$97.6 billion included ~~$31.0~~$41.3 billion, $36.7 billion and ~~$1.5~~$19.6 billion of net ~~outflows from~~inflows into iShares ETFs, institutional and retail ~~clients, respectively, partially offset by net inflows of $13.8 billion into~~ ~~iShares ETFs~~.products, respectively. Net flows in long-term products are described below.

Cash management AUM increased to $652 billion, driven by net inflows of $27.8 billion.

AUM increased $73.8 billion due to the positive impact of foreign exchange movements, primarily due to the weakening of the US dollar, largely against the British pound and the Euro.

The following table presents the component changes in AUM by client type and product type for the nine months ended September 30, 2020.

	December 31,		Net inflows			Market			FX			September 30,		Average
(in millions)	2019		(outflows)			change			impact⁽¹⁾			2020		AUM⁽²⁾
Retail:
Equity	$	252,413	$	23,244		$	4,038		$	(268	)	$	279,427	$	252,221
Fixed income		305,265		8,564			3,208			(1,029	)		316,008		303,363
Multi-asset		120,439		(3,126	)		2,569			(174	)		119,708		114,401
Alternatives		25,180		5,554			317			70			31,121		27,502
Retail subtotal		703,297		34,236			10,132			(1,401	)		746,264		697,487
iShares ETFs:
Equity		1,632,972		11,050			(57,319	)		146			1,586,849		1,504,589
Fixed income		565,790		75,359			19,246			2,604			662,999		611,117
Multi-asset		5,210		230			1			(11	)		5,430		5,104
Alternatives		36,093		19,494			10,428			42			66,057		50,403
iShares ETFs subtotal		2,240,065		106,133			(27,644	)		2,781			2,321,335		2,171,213
Institutional:
Active:
Equity		141,118		4,708			3,369			65			149,260		135,354
Fixed income		651,368		3,082			36,857			1,754			693,061		663,749
Multi-asset		434,233		16,211			11,737			2,061			464,242		431,055
Alternatives		111,951		6,269			1,989			350			120,559		114,414
Active subtotal		1,338,670		30,270			53,952			4,230			1,427,122		1,344,572
Index:
Equity		1,793,826		(38,086	)		10,629			2,213			1,768,582		1,674,238
Fixed income		792,969		8,252			58,782			(606	)		859,397		819,510
Multi-asset		8,239		301			237			89			8,866		8,104
Alternatives		4,848		45			(330	)		-			4,563		4,487
Index subtotal		2,599,882		(29,488	)		69,318			1,696			2,641,408		2,506,339
Institutional subtotal		3,938,552		782			123,270			5,926			4,068,530		3,850,911
Long-term		6,881,914		141,151			105,758			7,306			7,136,129		6,719,611
Cash management		545,949		104,405			156			1,492			652,002		602,703
Advisory⁽³⁾		1,770		18,350			266			(20	)		20,366		10,679
Total	$	7,429,633	$	263,906		$	106,180		$	8,778		$	7,808,497	$	7,332,993

The following table presents the component changes in AUM by investment style and product type for the nine months ended September 30, 2020.

	December 31,		Net inflows			Market			FX			September 30,		Average
(in millions)	2019		(outflows)			change			impact⁽¹⁾			2020		AUM⁽²⁾
Active:
Equity	$	316,145	$	21,616		$	9,531		$	339		$	347,631	$	311,834
Fixed income		939,275		10,151			39,061			925			989,412		949,178
Multi-asset		554,672		13,086			14,307			1,887			583,952		545,455
Alternatives		137,130		11,822			2,306			420			151,678		141,915
Active subtotal		1,947,222		56,675			65,205			3,571			2,072,673		1,948,382
Index and iShares ETFs:
iShares ETFs:
Equity		1,632,972		11,050			(57,319	)		146			1,586,849		1,504,589
Fixed income		565,790		75,359			19,246			2,604			662,999		611,117
Multi-asset		5,210		230			1			(11	)		5,430		5,104
Alternatives		36,093		19,494			10,428			42			66,057		50,403
iShares ETFs subtotal		2,240,065		106,133			(27,644	)		2,781			2,321,335		2,171,213
Non-ETF Index
Equity		1,871,212		(31,750	)		8,505			1,671			1,849,638		1,749,979
Fixed income		810,327		9,747			59,786			(806	)		879,054		837,444
Multi-asset		8,239		300			236			89			8,864		8,105
Alternatives		4,849		46			(330	)		-			4,565		4,488
Non-ETF Index subtotal		2,694,627		(21,657	)		68,197			954			2,742,121		2,600,016
Index & iShares ETFs subtotal		4,934,692		84,476			40,553			3,735			5,063,456		4,771,229
Long-term		6,881,914		141,151			105,758			7,306			7,136,129		6,719,611
Cash management		545,949		104,405			156			1,492			652,002		602,703
Advisory⁽³⁾		1,770		18,350			266			(20	)		20,366		10,679
Total	$	7,429,633	$	263,906		$	106,180		$	8,778		$	7,808,497	$	7,332,993

The following table presents the component changes in AUM by product type for the nine months ended September 30, 2020.

AUM increased $378.9 billion to $7.81 trillion at September 30, 2020, driven by positive net inflows and net market appreciation.

Net market appreciation of $106.2 billion was primarily driven by fixed income market appreciation, partially offset by deprecation in equity markets year to date.

Long-term net inflows of $141.2 billion included $106.1 billion, $34.2 billion and $30.3 billion of net inflows into iShares ETFs, retail and institutional active products, respectively, partially offset by net outflows $29.4 billion from institutional index clients. Net flows in long-term products are described below.

Cash management AUM increased to ~~$594.1~~$652 billion, driven by net inflows of ~~$52.4 billion, primarily in US government funds.~~$104.4 billion.

AUM ~~decreased $91.4~~increased $8.8 billion due to the ~~negative~~positive impact of foreign exchange movements, primarily due to the weakening of the US dollar against the Euro, partially offset by the strengthening of the US dollar ~~largely~~ against the British ~~pound, Euro and Canadian dollar.~~pound.

Component Changes in AUM for the Twelve Months Ended ~~March 31,~~September 30, 2020

The following table presents the component changes in AUM by client type and product type for the twelve months ended ~~March 31,~~September 30, 2020.

	March 31,		Net inflows			Market			FX			March 31,		Average		September 30,		Net inflows			Market			FX			September 30,		Average
(in millions)	2019		(outflows)			change			impact⁽¹⁾			2020		AUM⁽²⁾		2019		(outflows)			change			impact⁽¹⁾			2020		AUM⁽²⁾
Retail:
Equity	$	225,992	$	12,064		$	(30,530	)	$	(2,784	)	$	204,742	$	233,405	$	231,645	$	25,180		$	19,098		$	3,504		$	279,427	$	248,948
Fixed income		281,566		6,881			(6,917	)		(3,473	)		278,057		295,202		297,186		13,556			3,959			1,307			316,008		302,419
Multi-asset		117,898		(9,158	)		(7,121	)		(587	)		101,032		116,401		116,040		(3,714	)		7,030			352			119,708		115,092
Alternatives		20,899		5,309			(1,081	)		(134	)		24,993		23,723		23,247		7,224			405			245			31,121		26,667
Retail subtotal		646,355		15,096			(45,649	)		(6,978	)		608,824		668,731		668,118		42,246			30,492			5,408			746,264		693,126
iShares ETFs:
Equity		1,423,204		76,775			(238,529	)		(7,760	)		1,253,690		1,476,391		1,468,711		60,122			52,720			5,296			1,586,849		1,507,986
Fixed income		471,161		78,505			7,457			(3,114	)		554,009		533,364		539,260		100,322			17,597			5,820			662,999		596,496
Multi-asset		4,171		773			(413	)		(32	)		4,499		4,656		4,659		610			165			(4	)		5,430		5,038
Alternatives		26,174		10,582			3,278			(42	)		39,992		32,853		34,188		20,281			11,510			78			66,057		46,774
iShares ETFs subtotal		1,924,710		166,635			(228,207	)		(10,948	)		1,852,190		2,047,264		2,046,818		181,335			81,992			11,190			2,321,335		2,156,294
Institutional:
Active:
Equity		118,653		8,412			(12,675	)		(1,950	)		112,440		127,068		128,723		5,232			13,331			1,974			149,260		134,610
Fixed income		571,313		28,106			30,343			(4,417	)		625,345		635,912		649,883		(2,066	)		38,293			6,951			693,061		660,994
Multi-asset		369,046		34,389			(15,562	)		(6,457	)		381,416		400,741		398,937		31,429			26,224			7,652			464,242		425,765
Alternatives		101,138		11,322			(335	)		(1,234	)		110,891		106,783		105,521		10,972			2,293			1,773			120,559		112,942
Active subtotal		1,160,150		82,229			1,771			(14,058	)		1,230,092		1,270,504		1,283,064		45,567			80,141			18,350			1,427,122		1,334,311
Index:
Equity		1,608,036		(39,657	)		(164,233	)		(15,356	)		1,388,790		1,652,582		1,659,424		(51,017	)		140,271			19,904			1,768,582		1,681,295
Fixed income		705,926		34,793			53,196			(15,511	)		778,404		765,808		781,102		21,719			30,216			26,360			859,397		812,141
Multi-asset		8,405		(1,070	)		(128	)		23			7,230		8,097		8,085		247			441			93			8,866		8,095
Alternatives		4,713		(23	)		(580	)		(35	)		4,075		4,566		4,570		90			(179	)		82			4,563		4,526
Index subtotal		2,327,080		(5,957	)		(111,745	)		(30,879	)		2,178,499		2,431,053		2,453,181		(28,961	)		170,749			46,439			2,641,408		2,506,057
Institutional subtotal		3,487,230		76,272			(109,974	)		(44,937	)		3,408,591		3,701,557		3,736,245		16,606			250,890			64,789			4,068,530		3,840,368
Long-term		6,058,295		258,003			(383,830	)		(62,863	)		5,869,605		6,417,552		6,451,181		240,187			363,374			81,387			7,136,129		6,689,788
Cash management		455,271		139,849			2,119			(3,150	)		594,089		512,006		510,984		134,204			1,164			5,650			652,002		583,512
Advisory⁽³⁾		1,779		1,207			28			(40	)		2,974		1,864		1,767		18,353			252			(6	)		20,366		8,618
Total	$	6,515,345	$	399,059		$	(381,683	)	$	(66,053	)	$	6,466,668	$	6,931,422	$	6,963,932	$	392,744		$	364,790		$	87,031		$	7,808,497	$	7,281,918

The following table presents the component changes in AUM by investment style and product type for the twelve months ended ~~March 31,~~September 30, 2020.

	March 31,		Net inflows			Market			FX			March 31,		Average		September 30,		Net inflows			Market			FX			September 30,		Average
(in millions)	2019		(outflows)			change			impact⁽¹⁾			2020		AUM⁽²⁾		2019		(outflows)			change			impact⁽¹⁾			2020		AUM⁽²⁾
Active:
Equity	$	278,944	$	10,454		$	(33,471	)	$	(3,169	)	$	252,758	$	290,224	$	290,519	$	22,302		$	30,974		$	3,836		$	347,631	$	308,605
Fixed income		836,950		35,027			22,789			(7,308	)		887,458		914,780		931,179		9,025			41,606			7,602			989,412		945,830
Multi-asset		486,944		25,232			(22,682	)		(7,044	)		482,450		517,141		514,973		27,720			33,255			8,004			583,952		540,857
Alternatives		122,037		16,630			(1,417	)		(1,368	)		135,882		130,506		128,766		18,195			2,699			2,018			151,678		139,608
Active subtotal		1,724,875		87,343			(34,781	)		(18,889	)		1,758,548		1,852,651		1,865,437		77,242			108,534			21,460			2,072,673		1,934,900
Index and iShares ETFs:
iShares ETFs:
Equity		1,423,204		76,775			(238,529	)		(7,760	)		1,253,690		1,476,391		1,468,711		60,122			52,720			5,296			1,586,849		1,507,986
Fixed income		471,161		78,505			7,457			(3,114	)		554,009		533,364		539,260		100,322			17,597			5,820			662,999		596,496
Multi-asset		4,171		773			(413	)		(32	)		4,499		4,656		4,659		610			165			(4	)		5,430		5,038
Alternatives		26,174		10,582			3,278			(42	)		39,992		32,853		34,188		20,281			11,510			78			66,057		46,774
iShares ETFs subtotal		1,924,710		166,635			(228,207	)		(10,948	)		1,852,190		2,047,264		2,046,818		181,335			81,992			11,190			2,321,335		2,156,294
Non-ETF Index:
Equity		1,673,737		(29,635	)		(173,967	)		(16,921	)		1,453,214		1,722,831		1,729,273		(42,907	)		141,726			21,546			1,849,638		1,756,248
Fixed income		721,855		34,753			53,833			(16,093	)		794,348		782,142		796,992		24,184			30,862			27,016			879,054		829,724
Multi-asset		8,405		(1,071	)		(129	)		23			7,228		8,098		8,089		242			440			93			8,864		8,095
Alternatives		4,713		(22	)		(579	)		(35	)		4,077		4,566		4,572		91			(180	)		82			4,565		4,527
Non-ETF Index subtotal		2,408,710		4,025			(120,842	)		(33,026	)		2,258,867		2,517,637		2,538,926		(18,390	)		172,848			48,737			2,742,121		2,598,594
Index & iShares ETFs subtotal		4,333,420		170,660			(349,049	)		(43,974	)		4,111,057		4,564,901		4,585,744		162,945			254,840			59,927			5,063,456		4,754,888
Long-term		6,058,295		258,003			(383,830	)		(62,863	)		5,869,605		6,417,552		6,451,181		240,187			363,374			81,387			7,136,129		6,689,788
Cash management		455,271		139,849			2,119			(3,150	)		594,089		512,006		510,984		134,204			1,164			5,650			652,002		583,512
Advisory⁽³⁾		1,779		1,207			28			(40	)		2,974		1,864		1,767		18,353			252			(6	)		20,366		8,618
Total	$	6,515,345	$	399,059		$	(381,683	)	$	(66,053	)	$	6,466,668	$	6,931,422	$	6,963,932	$	392,744		$	364,790		$	87,031		$	7,808,497	$	7,281,918

The following table presents the component changes in AUM by product type for the twelve months ended ~~March 31,~~September 30, 2020.

	March 31,		Net inflows		Market			FX			March 31,		Average		September 30,		Net inflows		Market			FX			September 30,		Average
(in millions)	2019		(outflows)		change			impact⁽¹⁾			2020		AUM⁽²⁾		2019		(outflows)		change			impact⁽¹⁾			2020		AUM⁽²⁾
Equity	$	3,375,885	$	57,594	$	(445,967	)	$	(27,850	)	$	2,959,662	$	3,489,446	$	3,488,503	$	39,517	$	225,420		$	30,678		$	3,784,118	$	3,572,839
Fixed income		2,029,966		148,285		84,079			(26,515	)		2,235,815		2,230,286		2,267,431		133,531		90,065			40,438			2,531,465		2,372,050
Multi-asset		499,520		24,934		(23,224	)		(7,053	)		494,177		529,895		527,721		28,572		33,860			8,093			598,246		553,990
Alternatives:
Illiquid alternatives		66,462		10,733		(1,265	)		(829	)		75,101		70,899		70,516		10,420		(2,177	)		964			79,723		75,583
Liquid alternatives		53,118		5,615		(13	)		(593	)		58,127		56,910		55,544		7,804		4,904			1,003			69,255		61,331
Currency and commodities⁽⁴⁾		33,344		10,842		2,560			(23	)		46,723		40,116		41,466		20,343		11,302			211			73,322		53,995
Alternatives subtotal		152,924		27,190		1,282			(1,445	)		179,951		167,925		167,526		38,567		14,029			2,178			222,300		190,909
Long-term		6,058,295		258,003		(383,830	)		(62,863	)		5,869,605		6,417,552		6,451,181		240,187		363,374			81,387			7,136,129		6,689,788
Cash management		455,271		139,849		2,119			(3,150	)		594,089		512,006		510,984		134,204		1,164			5,650			652,002		583,512
Advisory⁽³⁾		1,779		1,207		28			(40	)		2,974		1,864		1,767		18,353		252			(6	)		20,366		8,618
Total	$	6,515,345	$	399,059	$	(381,683	)	$	(66,053	)	$	6,466,668	$	6,931,422	$	6,963,932	$	392,744	$	364,790		$	87,031		$	7,808,497	$	7,281,918

AUM ~~decreased $48.7~~increased $844.6 billion to ~~$6.47~~$7.81 trillion at ~~March 31,~~September 30, 2020, driven by positive net inflows, net market ~~depreciation~~appreciation and the ~~negative~~positive impact of foreign exchange ~~movements, partially offset by positive net inflows.~~movements.

Net market ~~depreciation~~appreciation of ~~$381.7~~$364.8 billion was driven by ~~declines in~~ global equity ~~markets.~~and fixed income market appreciation.

Long-term net inflows of ~~$258.0~~$240.2 billion were comprised of net inflows of ~~$166.6~~$181.3 billion, ~~$76.3~~$45.6 billion and ~~$15.1~~$42.2 billion from iShares ETFs, institutional active and retail clients, ~~respectively.~~respectively, partially offset by net outflows of $28.9 billion from institutional index products. Net flows in long-term products are described below.

Cash management AUM increased to ~~$594~~$652 billion, due to net inflows of ~~$139.8 billion, primarily in government funds.~~$134.2 billion.

AUM ~~decreased $66.1~~increased $87 billion due to the ~~negative~~positive impact of foreign exchange movements, primarily resulting from the ~~strengthening~~weakening of the US dollar, largely against the ~~British pound~~Euro and the ~~Euro.~~British pound.

The Company’s results of operations for the three and nine months ended ~~March 31,~~September 30, 2020 and 2019 are discussed below. For a further description of the Company’s revenue and expense, see the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 (“2019 Form 10-K”).

The table below presents detail of revenue for the three and nine months ended ~~March 31,~~September 30, 2020 and 2019 and includes the product type mix of ~~investment advisory, administration~~base fees ~~and securities lending revenue (collectively “base fees”)~~ and performance fees.

	Three Months Ended				Three Months Ended				Nine Months Ended
	March 31,				September 30,				September 30,
(in millions)	2020		2019		2020		2019		2020		2019
Investment advisory, administration fees and securities lending revenue:
Equity:
Active	$	398	$	375	$	457	$	391	$	1,236	$	1,151
iShares ETFs		879		847		880		872		2,551		2,589
Non-ETF Index		163		164		164		168		505		495
Equity subtotal		1,440		1,386		1,501		1,431		4,292		4,235
Fixed income:
Active		481		457		498		496		1,443		1,427
iShares ETFs		259		220		297		251		817		705
Non-ETF Index		112		97		113		98		354		293
Fixed income subtotal		852		774		908		845		2,614		2,425
Multi-asset		293		276		289		288		852		852
Alternatives:
Illiquid alternatives		148		110		140		122		416		350
Liquid alternatives		112		94		132		105		361		301
Currency and commodities⁽¹⁾		32		24		51		30		118		78
Alternatives subtotal		292		228		323		257		895		729
Long-Term		2,877		2,664		3,021		2,821		8,653		8,241
Cash management		178		141		204		159		593		447
Total base fees		3,055		2,805		3,225		2,980		9,246		8,688
Investment advisory performance fees:
Equity		2		—		4		1		29		5
Fixed income		2		2		9		—		13		2
Multi-asset		1		—		10		1		13		7
Alternatives:
Illiquid alternatives		17		20		6		5		55		40
Liquid alternatives		19		4		503		114		575		157
Alternatives subtotal		36		24		509		119		630		197
Total performance fees		41		26		532		121		685		211
Technology services revenue		274		204		282		259		834		700
Distribution fees:
Retrocessions		169		161		188		166		519		491
12b-1 fees (US mutual fund distribution fees)		91		89		85		90		254		267
Other		16		12		15		14		44		41
Total distribution fees		276		262		288		270		817		799
Advisory and other revenue:
Advisory		17		19		14		21		48		62
Other		47		30		28		41		97		102
Total advisory and other revenue		64		49		42		62		145		164
Total revenue	$	3,710	$	3,346	$	4,369	$	3,692	$	11,727	$	10,562

	Three Months Ended March 31,												Three Months Ended September 30,												Nine Months Ended September 30,
	Mix of Base Fees						Mix of Average AUM by Product Type⁽¹⁾						Mix of Base Fees						Mix of Average AUM by Product Type⁽¹⁾						Mix of Base Fees						Mix of Average AUM by Asset Class⁽²⁾
	2020			2019			2020			2019			2020			2019			2020			2019			2020			2019			2020			2019
Equity:
Active		12	%		13	%		4	%		4	%		15	%		13	%		4	%		4	%		14	%		13	%		4	%		4	%
iShares ETFs		29	%		30	%		21	%		22	%		27	%		29	%		20	%		21	%		28	%		30	%		21	%		21	%
Non-ETF Index		5	%		6	%		24	%		26	%		5	%		6	%		24	%		25	%		5	%		6	%		23	%		26	%
Equity subtotal		46	%		49	%		49	%		52	%		47	%		48	%		48	%		50	%		47	%		49	%		48	%		51	%
Fixed income:
Active		16	%		16	%		12	%		13	%		15	%		17	%		13	%		14	%		15	%		17	%		13	%		13	%
iShares ETFs		8	%		9	%		8	%		7	%		9	%		8	%		9	%		8	%		9	%		8	%		8	%		7	%
Non-ETF Index		4	%		3	%		12	%		11	%		4	%		3	%		11	%		11	%		4	%		3	%		12	%		11	%
Fixed income subtotal		28	%		28	%		32	%		31	%		28	%		28	%		33	%		33	%		28	%		28	%		33	%		31	%
Multi-asset		10	%		10	%		8	%		8	%		9	%		10	%		8	%		8	%		9	%		10	%		8	%		8	%
Alternatives:
Illiquid alternatives		5	%		4	%		1	%		1	%		4	%		4	%		1	%		1	%		5	%		4	%		1	%		1	%
Liquid alternatives		4	%		3	%		1	%		1	%		4	%		4	%		1	%		1	%		4	%		3	%		1	%		1	%
Currency and commodities⁽²⁾⁽³⁾		1	%		1	%		1	%		-	%		2	%		1	%		1	%		-	%		1	%		1	%		1	%		1	%
Alternatives subtotal		10	%		8	%		3	%		2	%		10	%		9	%		3	%		2	%		10	%		8	%		3	%		3	%
Long-term		94	%		95	%		92	%		93	%		94	%		95	%		92	%		93	%		94	%		95	%		92	%		93	%
Cash management		6	%		5	%		8	%		7	%		6	%		5	%		8	%		7	%		6	%		5	%		8	%		7	%
Total excluding Advisory AUM		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%		100	%

Three Months Ended ~~March 31,~~September 30, 2020 Compared with Three Months Ended ~~March 31,~~September 30, 2019

Revenue increased ~~$364~~$677 million, or 18%, from the three months ended September 30, 2019, reflecting higher performance fees and continued organic growth.

Investment advisory, administration fees and securities lending revenue of $3,225 million increased $245 million from $2,980 million for the three months ended September 30, 2019, primarily driven by organic growth, the positive impact of market beta and foreign exchange movements on average AUM, partially offset by strategic pricing changes to certain products. Securities lending revenue of $153 million in the current quarter compared with $150 million in the third quarter of 2019.

Investment advisory performance fees of $532 million increased $411 million from $121 million for the three months ended September 30, 2019, primarily reflecting strong performance from a single hedge fund with an annual performance measurement period that ends in the third quarter.

Technology services revenue of $282 million increased $23 million from $259 million for the three months ended September 30, 2019, primarily reflecting higher revenue from Aladdin.

Advisory and other revenue of $42 million decreased $20 million from $62 million for the three months ended September 30, 2019, primarily reflecting the impact of the previously discussed Charitable Contribution of BlackRock’s remaining 20% stake in PennyMac in the first quarter of 2020.

Nine Months Ended September 30, 2020 Compared with Nine Months Ended September 30, 2019

Revenue increased $1,165 million, or 11%, from the ~~three~~nine months ended ~~March 31,~~September 30, 2019, ~~primarily driven by~~reflecting higher base fees, higher performance fees and ~~34% growth in~~higher technology services revenue.

Investment advisory, administration fees and securities lending revenue of ~~$3,055~~$9,246 million increased ~~$250~~$558 million from ~~$2,805~~$8,688 million for the ~~three~~nine months ended ~~March 31,~~September 30, 2019, primarily driven by organic growth, the ~~net~~ positive impact of market beta and foreign exchange movements on average AUM, ~~despite the impact of recent market volatility, and the effect of one more day in the quarter,~~ partially offset by strategic pricing changes to certain products. Securities lending revenue of ~~$158~~$521 million increased $73 million from ~~$148~~$448 million ~~in first quarter~~for the nine months ended September 30, 2019, primarily reflecting higher asset spreads and average balances of ~~2019.~~securities on loan.

Investment advisory performance fees of ~~$41~~$685 million increased ~~$15~~$474 million from ~~$26~~$211 million for the ~~three~~nine months ended ~~March 31,~~September 30, 2019, primarily reflecting higher revenue from ~~liquid~~ alternative ~~products.~~products including strong performance from a single hedge fund with an annual performance measurement period that ends in the third quarter.

Technology services revenue of ~~$274~~$834 million increased ~~$70~~$134 million from ~~$204~~$700 million for the ~~three~~nine months ended ~~March 31,~~September 30, 2019, primarily reflecting higher revenue from Aladdin and the impact of the eFront acquisition, ~~and higher revenue from~~ ~~Aladdin~~.which closed in May of 2019.

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
(in millions)	2020		2019			2020		2019
Expense:
Employee compensation and benefits	$	1,411	$	1,111		$	3,700	$	3,258
Distribution and servicing costs:
Retrocessions		188		166			519		491
12b-1 costs		83		89			247		265
Other		185		172			564		491
Total distribution and servicing costs		456		427			1,330		1,247
Direct fund expense		257		239			780		733
General and administration:
Marketing and promotional		48		79			156		241
Occupancy and office related		81		75			239		224
Portfolio services		73		64			203		191
Technology		93		70			273		206
Professional services		36		38			121		115
Communications		14		10			40		29
Foreign exchange remeasurement		1		(2	)		7		18
Contingent consideration fair value adjustments		—		(1	)		23		18
Product launch costs		80		—			164		59
Charitable Contribution		—		—			589		—
Other general and administration		35		52			176		142
Total general and administration expense		461		385			1,991		1,243
Amortization of intangible assets		27		28			79		68
Total expense	$	2,612	$	2,190		$	7,880	$	6,549

Three Months Ended ~~March 31,~~September 30, 2020 Compared with Three Months Ended ~~March 31,~~September 30, 2019

~~GAAP~~. Expense increased ~~$913~~$422 million from the three months ended ~~March 31,~~September 30, 2019, primarily driven by higher employee compensation and benefits expense, and higher general and administration expense, including the impact of product launch costs in the current quarter.

Employee compensation and benefits expense increased $300 million from the three months ended September 30, 2019, primarily reflecting higher incentive compensation associated with higher performance fees and operating income.

General and administration expense increased $76 million from the three months ended September 30, 2019, reflecting $80 million of previously described product launch costs. The increase also reflected higher technology expense, including certain costs related to COVID-19, and lower marketing and promotional expense.

Nine Months Ended September 30, 2020 Compared with Nine Months Ended September 30, 2019

Expense increased $1,331 million from the nine months ended September 30, 2019, primarily driven by higher general and administration expense, including the impact of the Charitable Contribution and higher product launch costs, ~~in the current quarter,~~ higher employee compensation and benefits expense, and higher volume-related ~~expense.~~expense for the nine months ended September 30, 2020.

Employee compensation and benefits expense increased ~~$73~~$442 million from the ~~three~~nine months ended ~~March 31,~~September 30, 2019, primarily reflecting higher base and incentive compensation, ~~partially linked to a~~driven in part by higher ~~headcount.~~performance fees and operating income.

Direct fund expense increased ~~$35~~$47 million from the ~~three~~nine months ended ~~March 31,~~September 30, 2019, reflecting higher average AUM.

General and administration expense increased ~~$754~~$748 million from the ~~three~~nine months ended ~~March 31,~~September 30, 2019, primarily driven by $589 million of expense related to the Charitable Contribution, ~~and $84 million of~~higher product launch ~~costs. The increase also reflected~~costs, higher technology expense, including certain costs related to COVID-19, ~~higher professional services expense, contingent consideration fair value adjustments related to prior acquisitions, and~~ costs related to certain legal matters, including Aviron Capital, LLC., and a $12 million impairment of a fixed asset. The increase was partially offset by lower marketing and promotional ~~expense.~~expense and lower foreign exchange remeasurement expense for the nine months ended September 30, 2020.

The summary of nonoperating income (expense), less net income (loss) attributable to NCI for the three and nine months ended ~~March 31,~~September 30, 2020 and 2019 was as follows:

	Three Months Ended						Three Months Ended							Nine Months Ended
	March 31,						September 30,							September 30,
(in millions)	2020			2019		(in millions)	2020			2019				2020			2019
Nonoperating income (expense), GAAP basis⁽¹⁾	$	(71	)	$	125	$		224	$		(42	)	$		510	$		140
Less: Net income (loss) attributable to NCI		(179	)		7			153			—				162			17
Nonoperating income (expense), net of NCI⁽²⁾	$	108		$	118	$		71	$		(42	)	$		348	$		123

	Three Months Ended						Three Months Ended						Nine Months Ended
	March 31,						September 30,						September 30,
(in millions)	2020			2019			2020			2019			2020			2019
Net gain (loss) on investments⁽¹⁾⁽²⁾
Private equity	$	(18	)	$	—		$	18		$	6		$	8		$	38
Real assets		5			6			6			12			11			22
Other alternatives⁽³⁾		(25	)		8			14			3			10			18
Other investments⁽⁴⁾		(150	)		73			55			—			35			104
Subtotal		(188	)		87			93			21			64			182
Gain related to the charitable contribution		122			—
Gain related to the Charitable Contribution								—			—			122			—
Other gains (losses)⁽⁵⁾		205			48			23			(28	)		279			25
Total net gain (loss) on investments⁽¹⁾⁽²⁾		139			135			116			(7	)		465			207
Interest and dividend income		15			29			9			19			34			68
Interest expense		(46	)		(46	)		(54	)		(54	)		(151	)		(152	)
Net interest expense		(31	)		(17	)		(45	)		(35	)		(117	)		(84	)
Nonoperating income (expense)⁽¹⁾	$	108		$	118		$	71		$	(42	)	$	348		$	123

	GAAP						As Adjusted⁽¹⁾						GAAP												As Adjusted⁽¹⁾
	Three Months Ended						Three Months Ended						Three Months Ended						Nine Months Ended						Three Months Ended						Nine Months Ended
	March 31,						March 31,						September 30,						September 30,						September 30,						September 30,
(in millions)	2020			2019			2020			2019			2020			2019			2020			2019			2020			2019			2020			2019
Operating income(1)	$	684		$	1,233		$	1,273		$	1,233		$	1,757		$	1,502		$	3,847		$	4,013		$	1,757		$	1,502		$	4,436		$	4,013
Total nonoperating income (expense)⁽¹⁾⁽²⁾	$	108		$	118		$	(14	)	$	118		$	71		$	(42	)	$	348		$	123		$	71		$	(42	)	$	226		$	123
Income before income taxes	$	792		$	1,351		$	1,259		$	1,351		$	1,828		$	1,460		$	4,195		$	4,136		$	1,828		$	1,460		$	4,662		$	4,136
Income tax expense (benefit)	$	(14	)	$	298		$	227		$	298
Income tax expense													$	464		$	341		$	811		$	961		$	410		$	341		$	998		$	961
Effective tax rate		(1.7	)%		22.1	%		18.0	%		22.1	%		25.4	%		23.3	%		19.3	%		23.2	%		22.5	%		23.3	%		21.4	%		23.2	%

~~2020.~~ The ~~three~~nine months ended ~~March 31,~~September 30, 2020 income tax expense ~~(benefit)~~ included a discrete tax benefit of $241 million recognized in connection with the Charitable Contribution, which was excluded from as adjusted results, and ~~$64~~$78 million of discrete tax benefits, including benefits related to stock-based compensation awards that vested in the first quarter of 2020.

~~2019.~~The three and nine months ended ~~March 31, 2019~~September 30, 2020 income tax expense also included ~~$23~~the previously described $54 million ~~of discrete tax benefits, including benefits~~noncash net expense related to ~~stock-based compensation awards that vested~~the legislation enacted in the ~~first quarter of 2019.~~United Kingdom, which was excluded from as adjusted results.

The following table presents a reconciliation of the condensed consolidated statement of financial condition presented on a GAAP basis to the condensed consolidated statement of financial condition, excluding the impact of separate account assets and separate account collateral held under securities lending agreements (directly related to lending separate account securities) and separate account liabilities and separate account collateral liabilities under securities lending agreements and consolidated sponsored investment products.

The Company presents the as adjusted statement of financial condition as additional information to enable investors to exclude certain assets that have equal and offsetting liabilities or noncontrolling interests that ultimately do not have an impact on stockholders’ equity or cash flows. Management views the as adjusted statement of financial condition, which contains non-GAAP financial measures, as an economic presentation of the Company’s total assets and liabilities; however, it does not advocate that investors consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.

Separate Account Assets and Liabilities and Separate Account Collateral Held under Securities Lending Agreements

Separate account assets are maintained by BlackRock Life Limited, a wholly owned subsidiary of the Company that is a registered life insurance company in the United Kingdom, and represent segregated assets held for purposes of funding individual and group pension contracts. The Company records equal and offsetting separate account liabilities. The separate account assets are not available to creditors of the Company and the holders of the pension contracts have no recourse to the Company’s assets. The net investment income attributable to separate account assets accrues directly to the contract owners and is not reported on the condensed consolidated statements of income. While BlackRock has no economic interest in these assets or liabilities, BlackRock earns an investment advisory fee for the service of managing these assets on behalf of its clients.

In addition, the Company records on its condensed consolidated statements of financial condition the separate account collateral received under BlackRock Life Limited securities lending arrangements as its own asset in addition to an equal and offsetting separate account collateral liability for the obligation to return the collateral. The collateral is not available to creditors of the Company, and the borrowers under the securities lending arrangements have no recourse to the Company’s assets.

The Company consolidates certain sponsored investment products accounted for as ~~VIEs~~variable interest entities (“VIEs”) and voting rights entities (“VREs”), (collectively, “consolidated sponsored investment products”). See Note 2, Significant Accounting Policies, in the notes to the consolidated financial statements contained in the 2019 Form 10-K for more information on the Company’s consolidation policy.

The Company cannot readily access cash and cash equivalents or other assets held by consolidated sponsored investment products to use in its operating activities. In addition, the Company cannot readily sell investments held by consolidated sponsored investment products in order to obtain cash for use in the Company’s operations.

	March 31, 2020								September 30, 2020
(in millions)	GAAP Basis		Separate Account Assets/ Collateral⁽¹⁾		Consolidated Sponsored Investment Products⁽²⁾		As Adjusted		GAAP Basis		Separate Account Assets/ Collateral⁽¹⁾		Consolidated Sponsored Investment Products⁽²⁾		As Adjusted
Assets
Cash and cash equivalents	$	4,406	$	—	$	316	$	4,090	$	6,507	$	—	$	208	$	6,299
Accounts receivable		3,095		—		—		3,095		3,706		—		—		3,706
Investments		5,240		—		1,442		3,798		6,307		—		2,233		4,074
Separate account assets and collateral held under securities lending agreements		98,039		98,039		—		—		111,131		111,131		—		—
Other assets⁽³⁾		5,337		—		79		5,258		4,623		—		90		4,533
Subtotal		116,117		98,039		1,837		16,241		132,274		111,131		2,531		18,612
Goodwill and intangible assets, net		32,903		—		—		32,903		32,844		—		—		32,844
Total assets	$	149,020	$	98,039	$	1,837	$	49,144	$	165,118	$	111,131	$	2,531	$	51,456
Liabilities
Accrued compensation and benefits	$	858	$	—	$	—	$	858	$	1,847	$	—	$	—	$	1,847
Accounts payable and accrued liabilities		982		—		—		982		988		—		—		988
Borrowings		5,933		—		—		5,933		7,227		—		—		7,227
Separate account liabilities and collateral liabilities under securities lending agreements		98,039		98,039		—		—		111,131		111,131		—		—
Deferred income tax liabilities⁽⁴⁾		3,610		—		—		3,610		3,742		—		—		3,742
Other liabilities		5,088		—		340		4,748		4,167		—		388		3,779
Total liabilities		114,510		98,039		340		16,131		129,102		111,131		388		17,583
Equity
Total stockholders’ equity		33,013		—		—		33,013		33,873		—		—		33,873
Noncontrolling interests		1,497		—		1,497		—		2,143		—		2,143		—
Total equity		34,510		—		1,497		33,013		36,016		—		2,143		33,873
Total liabilities and equity	$	149,020	$	98,039	$	1,837	$	49,144	$	165,118	$	111,131	$	2,531	$	51,456

The following discussion summarizes the significant changes in assets and liabilities on a GAAP basis. Please see the condensed consolidated statements of financial condition as of ~~March 31,~~September 30, 2020 and December 31, 2019 contained in Part I, Item 1 of this filing. The discussion does not include changes related to assets and liabilities that are equal and offsetting and have no impact on BlackRock’s stockholders’ equity.

Assets. Cash and cash equivalents at ~~March 31,~~September 30, 2020 and December 31, 2019 included ~~$316~~$208 million and $141 million, respectively, of cash held by consolidated sponsored investment products (see Liquidity and Capital Resources for details on the change in cash and cash equivalents during the ~~three~~nine months ended ~~March 31,~~September 30, 2020).

Accounts receivable at ~~March 31,~~September 30, 2020 ~~decreased $84~~increased $527 million from December 31, 2019, primarily due to ~~lower receivables from~~higher performance fee, technology services and base ~~fees, partially offset by higher technology services~~fee receivables. Investments, including the impact of consolidated sponsored investment products, ~~were $5,240~~increased $818 million ~~at March~~from December 31, ~~2020~~2019 (for more information see Investments herein). Goodwill and intangible assets decreased ~~$28~~$87 million from December 31, 2019, primarily due to amortization of intangible assets. Other assets (including operating lease right-of-use ~~(“ROU”)~~ assets and property and equipment) increased ~~$1,453~~$739 million from December 31, 2019, primarily due to an increase in unit trust receivables (substantially offset by an increase in unit trust payables recorded within other liabilities), partially offset by a net decrease in certain corporate minority investments, primarily related to the previously discussed Charitable Contribution of ~~the~~BlackRock’s remaining 20% stake in ~~PennyMac Financial Services, Inc.~~PennyMac.

Liabilities. Accrued compensation and benefits at ~~March 31,~~September 30, 2020 decreased ~~$1,199~~$210 million from December 31, 2019, primarily due to 2019 incentive compensation cash payments in the first quarter of 2020, partially offset by 2020 incentive compensation accruals. Accounts payable and accrued liabilities at ~~March 31,~~September 30, 2020 decreased ~~$185~~$179 million from December 31, 2019, primarily due to lower current income taxes payables. Other liabilities increased ~~$1,618~~$697 million from December 31, 2019, primarily due to higher unit trust payables (substantially offset by an increase in unit trust receivables recorded within other assets)., partially offset by lower contingent liabilities related to certain acquisitions. Net deferred income tax liabilities at ~~March 31,~~September 30, 2020 ~~decreased $124~~increased $8 million from December 31, 2019, primarily due to the effects of temporary differences associated with stock-based compensation and the revaluation of certain deferred income tax liabilities due to tax legislation enacted in the United Kingdom, partially offset by the effects of temporary differences associated with investment income and the income tax benefit related to the Charitable ~~Contribution, partially offset by the effects of temporary differences associated with stock-based compensation.~~Contribution.

The Company’s investments were ~~$5,240~~$6,307 million and $5,489 million at ~~March 31,~~September 30, 2020 and December 31, 2019, respectively. Investments include consolidated investments held by sponsored investment products accounted for as VREs and VIEs. Management reviews BlackRock’s investments on an “economic” basis, which eliminates the portion of investments that does not impact BlackRock’s book value or net income attributable to BlackRock. BlackRock’s management does not advocate that investors consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP.

The Company presents investments, as adjusted, to enable investors to understand the portion of investments that is owned by the Company, net of NCI, as a gauge to measure the impact of changes in net nonoperating income (expense) on investments to net income (loss) attributable to BlackRock.

The Company further presents net “economic” investment exposure, net of deferred compensation investments and hedged investments, to reflect another helpful measure for investors. The economic impact of investments held pursuant to deferred compensation arrangements is offset by a change in compensation expense. The impact of certain investments is substantially mitigated by swap hedges. Carried interest capital allocations are excluded as there is no impact to BlackRock’s stockholders’ equity until such amounts are realized as performance fees. Finally, the Company’s regulatory investment in Federal Reserve Bank stock, which is not subject to market or interest rate risk, is excluded from the Company’s net economic investment exposure.

	March 31,			December 31,			September 30,			December 31,
(in millions)	2020			2019			2020			2019
Investments, GAAP	$	5,240		$	5,489		$	6,307		$	5,489
Investments held by consolidated sponsored investment products		(3,661	)		(3,784	)		(4,517	)		(3,784	)
Net interest in consolidated sponsored investment products⁽¹⁾		2,219			2,290			2,284			2,290
Investments, as adjusted		3,798			3,995			4,074			3,995
Federal Reserve Bank stock		(93	)		(93	)		(94	)		(93	)
Deferred compensation investments		(5	)		(23	)		(5	)		(23	)
Hedged investments		(597	)		(644	)		(735	)		(644	)
Carried interest		(569	)		(528	)		(483	)		(528	)
Total “economic” investment exposure⁽²⁾	$	2,534		$	2,707		$	2,757		$	2,707

The following table represents the carrying value of the Company’s economic investment exposure, by asset type, at ~~March 31,~~September 30, 2020 and December 31, 2019:

	March 31,		December 31,		September 30,		December 31,
(in millions)	2020		2019		2020		2019
Equity⁽¹⁾					$	715	$	609
Fixed income⁽²⁾						1,018		1,008
Multi-asset⁽³⁾						136		178
Alternatives:
Private equity	$	311	$	355		382		355
Real assets		299		322		262		322
Other alternatives⁽¹⁾		232		235
Other investments⁽²⁾		1,692		1,795
Other alternatives⁽⁴⁾						244		235
Alternatives subtotal						888		912
Total “economic” investment exposure	$	2,534	$	2,707	$	2,757	$	2,707

As adjusted investment activity for the ~~three~~nine months ended ~~March 31,~~September 30, 2020 was as follows:

(in millions)	Three Months Ended March 31, 2020			Nine Months Ended September 30, 2020
Investments, as adjusted, beginning balance	$	3,995		$	3,995
Purchases/capital contributions		399			883
Sales/maturities		(193	)		(664	)
Distributions⁽¹⁾		(80	)		(170	)
Market appreciation(depreciation)/earnings from equity method investments		(322	)		60
Carried interest capital allocations/(distributions)		41			(45	)
Other⁽²⁾		(42	)		15
Investments, as adjusted, ending balance	$	3,798		$	4,074

BlackRock Cash Flows Excluding the Impact of Consolidated Sponsored Investment Products

The condensed consolidated statements of cash flows include the cash flows of the consolidated sponsored investment products. The Company uses an adjusted cash flow statement, which excludes the impact of consolidated sponsored investment products, as a supplemental non-GAAP measure to assess liquidity and capital requirements. The Company believes that its cash flows, excluding the impact of the consolidated sponsored investment products, provide investors with useful information on the cash flows of BlackRock relating to its ability to fund additional operating, investing and financing activities. BlackRock’s management does not advocate that investors consider such non-GAAP measures in isolation from, or as a substitute for, its cash flows presented in accordance with GAAP.

The following table presents a reconciliation of the condensed consolidated statements of cash flows presented on a GAAP basis to the condensed consolidated statements of cash flows, excluding the impact of the cash flows of consolidated sponsored investment products:

(in millions)	GAAP Basis			Cash Flows of Consolidated Sponsored Investment Products			Cash Flows Excluding Impact of Consolidated Sponsored Investment Products			GAAP Basis			Cash Flows of Consolidated Sponsored Investment Products			Cash Flows Excluding Impact of Consolidated Sponsored Investment Products
Cash, cash equivalents and restricted cash, December 31, 2019	$	4,846		$	141		$	4,705		$	4,846		$	141		$	4,705
Net cash provided by/(used in) operating activities		(938	)		(694	)		(244	)		1,764			(1,287	)		3,051
Net cash provided by/(used in) investing activities		(34	)		(15	)		(19	)		(177	)		(42	)		(135	)
Net cash provided by/(used in) financing activities		628			884			(256	)		106			1,396			(1,290	)
Effect of exchange rate changes on cash, cash equivalents and restricted cash		(79	)		—			(79	)		(15	)		—			(15	)
Net increase/(decrease) in cash, cash equivalents and restricted cash		(423	)		175			(598	)		1,678			67			1,611
Cash, cash equivalents and restricted cash, March 31, 2020	$	4,423		$	316		$	4,107
Cash, cash equivalents and restricted cash, September 30, 2020										$	6,524		$	208		$	6,316

Sources of BlackRock’s operating cash primarily include investment advisory, administration fees and securities lending revenue, performance fees, technology services revenue, advisory and other revenue and distribution fees. BlackRock uses its cash to pay all operating ~~expense,~~expenses, interest and principal on borrowings, income taxes, dividends on BlackRock’s capital stock, repurchases of the Company’s stock, acquisitions, capital expenditures and purchases of co-investments and seed investments.

For details of the Company’s GAAP cash flows from operating, investing and financing activities, see the condensed consolidated statements of cash flows contained in Part I, Item 1 of this filing.

Cash flows provided by/(used in) operating activities, excluding the impact of consolidated sponsored investment products, primarily include the receipt of investment advisory and administration fees, securities lending revenue and performance fees offset by the payment of operating expenses incurred in the normal course of business, including year-end incentive compensation accrued for in the prior year.

Cash flows used in investing activities, excluding the impact of consolidated sponsored investment products, for the ~~three~~nine months ended ~~March 31,~~September 30, 2020 were ~~$19~~$135 million and reflected ~~$52~~$140 million of purchases of property and equipment and ~~$28~~$119 million of net investment purchases, partially offset by ~~$61~~$124 million of distributions of capital from equity method investees.

Cash flows used in financing activities, excluding the impact of consolidated sponsored investment products, for the ~~three~~nine months ended ~~March 31,~~September 30, 2020 were ~~$256 million,~~$1.3 billion, primarily resulting from ~~$657 million~~$1.8 billion of share repurchases, including ~~$400~~$1.1 billion from PNC, $412 million in open market transactions and ~~$257~~$280 million of employee tax withholdings related to employee stock transactions, and ~~$596 million~~$1.7 billion of cash dividend payments, partially offset by ~~$999 million~~$2.2 billion of proceeds from long-term borrowings.

The Company manages its financial condition and funding to maintain appropriate liquidity for the business. Liquidity resources at ~~March 31,~~September 30, 2020 and December 31, 2019 were as follows:

	March 31,			December 31,			September 30,			December 31,
(in millions)	2020			2019			2020			2019
Cash and cash equivalents⁽¹⁾	$	4,406		$	4,829		$	6,507		$	4,829
Cash and cash equivalents held by consolidated sponsored investment products⁽²⁾		(316	)		(141	)		(208	)		(141	)
Subtotal		4,090			4,688			6,299			4,688
Credit facility – undrawn		4,000			4,000			4,000			4,000
Total liquidity resources⁽³⁾	$	8,090		$	8,688		$	10,299		$	8,688

Total liquidity resources ~~decreased $598~~increased $1,611 million during the ~~three~~nine months ended ~~March 31,~~September 30, 2020, primarily reflecting ~~cash payments of 2019 year-end incentive awards, share repurchases of $657 million and cash dividend payments of $596 million, partially offset by $999 million~~$2.2 billion of proceeds from long-term borrowings and cash flows from other operating ~~activities.~~ activities, partially offset by cash payments of 2019 year-end incentive awards, share repurchases of $1.8 billion, including $1.1 billion from PNC, and cash dividend payments of $1.7 billion.

A significant portion of the Company’s ~~$3,798~~$4,074 million of investments, as adjusted, is illiquid in nature and, as such, cannot be readily convertible to cash.

The Company continues to monitor its liquidity and capital resources due to the current pandemic. The Company’s liquidity and capital resources were not materially impacted by COVID-19 and related economic conditions during the ~~first quarter of~~nine months ended September 30, 2020.

Share Repurchases. During the ~~three~~nine months ended ~~March 31,~~September 30, 2020, the Company repurchased 0.8 million common shares in open market transactions under the share repurchase program for approximately ~~$400~~$412 million. At ~~March 31,~~September 30, 2020, there were 5.1 million shares still authorized to be repurchased.

Including the repurchase from PNC, which was in addition to the share repurchase authorization under the Company’s existing share repurchase program, the Company has repurchased an aggregate of approximately $1.5 billion of its common shares during the nine months ended September 30, 2020 and has now completed its targeted level of share repurchases for the year, but will remain opportunistic should relative valuation opportunities arise.

Net Capital Requirements. The Company is required to maintain net capital in certain regulated subsidiaries within a number of jurisdictions, which is partially maintained by retaining cash and cash equivalent investments in those subsidiaries or jurisdictions. As a result, such subsidiaries of the Company may be restricted in their ability to transfer cash between different jurisdictions and to their parents. Additionally, transfers of cash between international jurisdictions may have adverse tax consequences that could discourage such transfers.

BlackRock Institutional Trust Company, N.A. (“BTC”) is chartered as a national bank that does not accept deposits or make commercial loans and whose powers are limited to trust and other fiduciary activities. BTC provides investment management and other fiduciary services, including investment advisory and securities lending agency services, to institutional clients. BTC is subject to regulatory capital and liquid asset requirements administered by the US Office of the Comptroller of the Currency.

At ~~March 31,~~September 30, 2020 and December 31, 2019, the Company was required to maintain approximately ~~$2.0~~$2.2 billion and $1.9 billion, respectively, in net capital in certain regulated subsidiaries, including BTC, entities regulated by the Financial Conduct Authority and Prudential Regulation Authority in the United Kingdom, and the Company’s broker-dealers. The Company was in compliance with all applicable regulatory net capital requirements.

2020 Revolving Credit Facility. The Company’s credit facility has an aggregate commitment amount of $4.0 billion and was amended in March 2020 to extend the maturity date to March 2025 (the “2020 credit facility”). The 2020 credit facility permits the Company to request up to an additional $1.0 billion of borrowing capacity, subject to lender credit approval, increasing the overall size of the 2020 credit facility to an aggregate principal amount not to exceed $5.0 billion. Interest on borrowings outstanding accrues at a rate based on the applicable London Interbank Offered Rate plus a spread. The 2020 credit facility requires the Company not to exceed a maximum leverage ratio (ratio of net debt to earnings before interest, taxes, depreciation and amortization, where net debt equals total debt less unrestricted cash) of 3 to 1, which was satisfied with a ratio of less than 1 to 1 at ~~March 31,~~September 30, 2020. The 2020 credit facility provides back-up liquidity to fund ongoing working capital for general corporate purposes and various investment opportunities. At ~~March 31,~~September 30, 2020, the Company had no amount outstanding under the 2020 credit facility.

At ~~March 31,~~September 30, 2020, the principal amount of long-term borrowings outstanding was ~~$6.0~~$7.3 billion. See Note 15, Borrowings, in the 2019 Form 10-K for more information on borrowings outstanding as of December 31, 2019.

During the ~~three~~nine months ended ~~March 31,~~September 30, 2020, the Company paid approximately ~~$29~~$124 million of interest on long-term borrowings. Future principal repayments and interest requirements at ~~March 31,~~September 30, 2020 were as follows:

(in millions)
Year	Principal		Interest		Total Payments		Principal		Interest		Total Payments
Remainder of 2020	$	—	$	146	$	146	$	—	$	57	$	57
2021		750		165		915		750		189		939
2022		750		136		886		750		161		911
2023		—		124		124		—		148		148
2024		1,000		106		1,106		1,000		130		1,130
2025⁽¹⁾		768		89		857		821		113		934
Thereafter		2,700		256		2,956		3,950		386		4,336
Total	$	5,968	$	1,022	$	6,990	$	7,271	$	1,184	$	8,455

In January 2020, the Company issued $1 billion in aggregate principal amount of 2.40% senior unsecured and unsubordinated notes maturing on April 30, 2030 (the “2030 Notes”). The net proceeds of the 2030 Notes were used for general corporate purposes. Interest of approximately $24 million per year is payable semi-annually on April 30 and October 30 of each year, ~~commencing~~which commenced on April 30, 2020. The 2030 Notes may be redeemed prior to January 30, 2030 in whole or in part at any time, at the option of the Company, at a “make-whole” redemption price or at 100% of the principal amount of the 2030 Notes thereafter. The unamortized discount and debt issuance costs are being amortized over the remaining term of the 2030 Notes.

In April 2020, the Company issued $1.25 billion in aggregate principal amount of 1.90% senior unsecured and unsubordinated notes maturing on January 28, 2031 (the “2031 Notes”). The net proceeds of the 2031 Notes ~~will be~~are being used for general corporate purposes, which may include the future repayment of all or a portion of the $750 million 4.25% Notes due May 2021. Interest of approximately $24 million per year ~~will be~~is payable semi-annually on January 28 and July 28 of each year, ~~commencing~~which commenced on July 28, 2020. The 2031 Notes may be redeemed prior to October 28, 2030 in whole or in part at any time, at the option of the Company, at a “make-whole” redemption price or at 100% of the principal amount of the 2031 Notes thereafter. The unamortized discount and debt issuance costs ~~will be~~are being amortized over the remaining term of the 2031 Notes.

Carried Interest Clawback. As a general partner in certain investment products, including private equity partnerships and certain hedge funds, the Company may receive carried interest cash distributions from the partnerships in accordance with distribution provisions of the partnership agreements. The Company may, from time to time, be required to return all or a portion of such distributions to the limited partners in the event the limited partners do not achieve a return as specified in the various partnership agreements. Therefore, BlackRock records carried interest subject to such clawback provisions in investments, or cash and cash equivalents to the extent that it is distributed, and as a deferred carried interest liability on its condensed consolidated statements of financial condition. Carried interest is recorded as performance fees on BlackRock’s condensed consolidated statements of income when fees are no longer probable of significant reversal.

Indemnifications. On behalf of certain clients, the Company lends securities to highly rated banks and broker-dealers. In these securities lending transactions, the borrower is required to provide and maintain collateral at or above regulatory minimums. Securities on loan are marked to market daily to determine if the borrower is required to pledge additional collateral. BlackRock has agreed to indemnify certain securities lending clients against potential loss resulting from a borrower’s failure to fulfill its obligations under the securities lending agreement should the value of the collateral pledged by the borrower at the time of default be insufficient to cover the borrower’s obligation under the securities lending agreement. The amount of securities on loan as of ~~March 31,~~September 30, 2020 and subject to this type of indemnification was ~~$224~~$249 billion. In the Company’s capacity as lending agent, cash and securities totaling ~~$238~~$265 billion were held as collateral for indemnified securities on loan at ~~March 31,~~September 30, 2020. The fair value of these indemnifications was not material at ~~March 31,~~September 30, 2020.

While the collateral pledged by a borrower is intended to be sufficient to offset the borrower’s obligations to return securities borrowed and any other amounts owing to the lender under the relevant securities lending agreement, in the event of a borrower default, the Company can give no assurance that the collateral pledged by the borrower will be sufficient to fulfill such obligations. If the amount of such pledged collateral is not sufficient to fulfill such obligations to a client for whom the Company has provided indemnification, BlackRock would be responsible for the amount of the shortfall. These indemnifications cover only the collateral shortfall described above, and do not in any way guarantee, assume or otherwise insure the investment performance or return of any cash collateral vehicle into which securities lending cash collateral is invested.

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expense during the reporting periods. Actual results could differ significantly from those estimates. Management considers the following critical accounting policies important to understanding the condensed consolidated financial statements. For a summary of these and additional accounting policies see Note 2, Significant Accounting Policies, in the notes to the condensed consolidated financial statements. In addition, see Critical Accounting Policies in Management’s Discussion and Analysis of Financial Condition and Results of Operations and Note 2, Significant Accounting Policies, in the 2019 Form 10-K for further information.

Consolidation. In the normal course of business, the Company is the manager of various types of sponsored investment vehicles. The Company performs an analysis for investment products to determine if the product is a VIE or a VRE. Assessing whether an entity is a VIE or a VRE involves judgment and analysis. Factors considered in this assessment include the entity’s legal organization, the entity’s capital structure and equity ownership, and any related party or de facto agent implications of the Company’s involvement with the entity. Investments that are determined to be VREs are consolidated if the Company can exert control over the financial and operating policies of the investee, which generally exists if there is greater than 50% voting interest. Investments that are determined to be VIEs are consolidated if the Company is the primary beneficiary (“PB”) of the entity. BlackRock is deemed to be the PB of a VIE if it has the power to direct the activities that most significantly impact the entities’ economic performance and has the obligation to absorb losses or the right to receive benefits that potentially could be significant to the VIE. The Company generally consolidates VIEs in which it holds an economic interest of 10% or greater and deconsolidates such VIEs once equity ownership falls below 10%. See Note 6, Consolidated Sponsored Investment Products, in the notes to the condensed consolidated financial statements for more information.

Fair Value Measurements. The Company’s assessment of the significance of a particular input to the fair value measurement according to the fair value hierarchy (i.e., Level 1, 2 and 3 inputs, as defined) in its entirety requires judgment and considers factors specific to the financial instrument. See Note 2, Significant Accounting Policies, in the notes to the condensed consolidated financial statements for more information on fair value measurements.

Investment Advisory Performance Fees / Carried Interest. The Company receives investment advisory performance fees, including incentive allocations (carried interest) from certain actively managed investment funds and certain separately managed accounts. These performance fees are dependent upon exceeding specified relative or absolute investment return thresholds, which may vary by product or account, and include monthly, quarterly, annual or longer measurement periods.

Performance fees, including carried interest, are recognized when it is determined that they are no longer probable of significant reversal (such as upon the sale of a fund’s investment or when the amount of AUM becomes known as of the end of a specified measurement period). Given the unique nature of each fee arrangement, contracts with customers are evaluated on an individual basis to determine the timing of revenue recognition. Significant judgement is involved in making such determination. Performance fees typically arise from investment management services that began in prior reporting periods. Consequently, a portion of the fees the Company recognizes may be partially related to the services performed in prior periods that meet the recognition criteria in the current period. At each reporting date, the Company considers various factors in estimating performance fees to be recognized, including carried interest. These factors include but are not limited to whether: (1) the fees are dependent on the market and thus are highly susceptible to factors outside the Company’s influence; (2) the fees have a large number and a broad range of possible amounts; and (3) the funds or separately managed accounts have the ability to invest or reinvest their sales proceeds.

The Company is allocated carried interest from certain alternative investment products upon exceeding performance thresholds. The Company may be required to reverse/return all, or part, of such carried interest allocations/distributions depending upon future performance of these products. Carried interest subject to such clawback provisions is recorded in investments or cash and cash equivalents to the extent that it is distributed, on its condensed consolidated statements of financial condition.

The Company records a liability for deferred carried interest to the extent it receives cash or capital allocations related to carried interest prior to meeting the revenue recognition criteria. At ~~March 31,~~September 30, 2020 and December 31, 2019, the Company had ~~$535~~$447 million and $483 million, respectively, of deferred carried interest recorded in other liabilities on the condensed consolidated statements of financial condition. A portion of the deferred carried interest may also be paid to certain employees. The ultimate timing of the recognition of performance fee revenue and related compensation expense, if any, for these products is unknown. See Note 16, Revenue, in the notes to the condensed consolidated financial statements for detailed changes in the deferred carried interest liability balance for the three and nine months ended ~~March 31,~~September 30, 2020 and 2019.

For accounting pronouncements that the Company adopted during the ~~three~~nine months ended ~~March 31,~~September 30, 2020, see Note 2, Significant Accounting Policies, in the notes to the condensed consolidated financial statements.

AUM Market Price Risk. BlackRock’s investment advisory and administration fees are primarily comprised of fees based on a percentage of the value of ~~AUM~~assets under management (“AUM”) and, in some cases, performance fees expressed as a percentage of the returns realized on AUM. At ~~March 31,~~September 30, 2020, the majority of the Company’s investment advisory and administration fees were based on average or period end AUM of the applicable investment funds or separate accounts. Movements in equity market prices, interest rates/credit spreads, foreign exchange rates or all three could cause the value of AUM to decline, which would result in lower investment advisory and administration fees.

Corporate Investments Portfolio Risks. As a leading investment management firm, BlackRock devotes significant resources across all of its operations to identifying, measuring, monitoring, managing and analyzing market and operating risks, including the management and oversight of its own investment portfolio. The Board of Directors of the Company has adopted guidelines for the review of investments to be made by the Company, requiring, among other things, that investments be reviewed by certain senior officers of the Company, and that certain investments may be referred to the Audit Committee or the Board of Directors, depending on the circumstances, for approval.

In the normal course of its business, BlackRock is exposed to equity market price risk, interest rate/credit spread risk and foreign exchange rate risk associated with its corporate investments.

BlackRock has investments primarily in sponsored investment products that invest in a variety of asset classes, including real assets, private equity and hedge funds. Investments generally are made for co-investment purposes, to establish a performance track record, to hedge exposure to certain deferred compensation plans or for regulatory purposes. Currently, the Company has a seed capital hedging program in which it enters into swaps to hedge market and interest rate exposure to certain investments. At ~~March 31,~~September 30, 2020, the Company had outstanding total return swaps with an aggregate notional value of approximately ~~$597~~$735 million. At ~~March 31,~~September 30, 2020, there were no outstanding interest rate swaps.

At ~~March 31,~~September 30, 2020, approximately ~~$3.7~~$4.5 billion of BlackRock’s investments were maintained in consolidated sponsored investment products accounted for as ~~VIEs~~variable interest entities and ~~VREs.~~voting rights entities. Excluding the impact of the Federal Reserve Bank stock, carried interest, investments made to hedge exposure to certain deferred compensation plans and certain investments that are hedged via the seed capital hedging program, the Company’s economic exposure to its investment portfolio is ~~$2.5~~$2.8 billion. See Statement of Financial Condition Overview-Investments in Management’s Discussion and Analysis of Financial Condition and Results of Operations for further information on the Company’s investments.

Equity Market Price Risk. At ~~March 31,~~September 30, 2020, the Company’s net exposure to equity market price risk in its investment portfolio was approximately ~~$900~~$995 million of the Company’s total economic investment exposure. Investments subject to market price risk include private equity and real assets investments, hedge funds and funds of funds as well as mutual funds. The Company estimates that a hypothetical 10% adverse change in market prices would result in a decrease of approximately ~~$90.0~~$100 million in the carrying value of such investments.

Interest Rate/Credit Spread Risk. At ~~March 31,~~September 30, 2020, the Company was exposed to interest-rate risk and credit spread risk as a result of approximately ~~$1,634~~$1,762 million of investments in debt securities and sponsored investment products that invest primarily in debt securities. Management considered a hypothetical 100 basis point fluctuation in interest rates or credit spreads and estimates that the impact of such a fluctuation on these investments, in the aggregate, would result in a decrease, or increase, of approximately ~~$33.8~~$43 million in the carrying value of such investments.

Foreign Exchange Rate Risk. As discussed above, the Company invests in sponsored investment products that invest in a variety of asset classes. The carrying value of the total economic investment exposure denominated in foreign currencies, primarily the British pound and Euro, was ~~$741~~$886 million at ~~March 31,~~September 30, 2020. A 10% adverse change in the applicable foreign exchange rates would result in approximately a ~~$74.1~~$89 million decline in the carrying value of such investments.

Other Market Risks. The Company executes forward foreign currency exchange contracts to mitigate the risk of certain foreign exchange risk movements. At ~~March 31,~~September 30, 2020, the Company had outstanding forward foreign currency exchange contracts with an aggregate notional value of approximately ~~$2.5~~$4.1 billion.

Disclosure Controls and Procedures. Under the direction of BlackRock’s Chief Executive Officer and Chief Financial Officer, BlackRock evaluated the effectiveness of its disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this quarterly report on Form 10-Q. Based on this evaluation, BlackRock’s Chief Executive Officer and Chief Financial Officer have concluded that BlackRock’s disclosure controls and procedures were effective.

Internal Control over Financial Reporting. There were no changes in our internal control over financial reporting that occurred during the quarter ended ~~March 31,~~September 30, 2020 that have materially affected or are reasonably likely to materially affect our internal control over financial reporting. In addition, there was no material impact to our internal control over financial reporting while most of our employees are working remotely due to the COVID-19 pandemic. The Company is continually monitoring and assessing the COVID-19 situation to determine any potential impact on the design and operating effectiveness of our internal control over financial reporting.

From time to time, BlackRock receives subpoenas or other requests for information from various US federal and state governmental and regulatory authorities and international governmental and regulatory authorities in connection with industry-wide or other investigations or proceedings. It is BlackRock’s policy to cooperate fully with such matters. The Company, certain of its subsidiaries and employees have been named as defendants in various legal actions, including arbitrations and other litigation arising in connection with BlackRock’s activities. Additionally, BlackRock-advised investment portfolios may be subject to lawsuits, any of which potentially could harm the investment returnsFor a discussion of the ~~applicable portfolio or result~~Company’s legal proceedings, see Note 15, Commitments and Contingencies, in the ~~Company being liable~~notes to the ~~portfolios for any resulting damages.~~

~~On May 27, 2014, certain investors in the BlackRock Global Allocation Fund, Inc. and the BlackRock Equity Dividend Fund (collectively, the “Funds”) filed a~~condensed consolidated ~~complaint (the “Consolidated Complaint”) in the US District Court for the District~~financial statements of ~~New Jersey against BlackRock Advisors, LLC, BlackRock Investment Management, LLC and BlackRock International Limited under the caption~~ ~~In re BlackRock Mutual Funds Advisory Fee Litigation~~. In the lawsuit, which purports to be brought derivatively on behalf of the Funds, the plaintiffs allege that the defendants violated Section 36(b) of the Investment Company Act by receiving allegedly excessive investment advisory fees from the Funds. On June 13, 2018, the court granted in part and denied in part the defendants’ motion for summary judgment. On July 25, 2018, the plaintiffs served a pleading that supplemented the time period of their alleged damages to run through the date of trial. The lawsuit seeks, among other things, to recover on behalf of the Funds all allegedly excessive advisory fees received by the defendants beginning twelve months preceding the start of the lawsuit with respect to each Fund and ending on the date of judgment, along with purported lost investment returns on those amounts, plus interest. The trial on the remaining issues was completed on August 29, 2018. On February 8, 2019, the court issued an order dismissing the claims in their entirety. The plaintiffs filed a notice of appeal on March 8, 2019, which remains pending. The defendants believe the claims in this ~~lawsuit are without merit.~~

~~On June 16, 2016,~~ ~~iShares~~ ~~Trust, BlackRock, Inc. and certain of its advisory subsidiaries, and the directors and certain officers of the~~ ~~iShares~~ ~~ETFs were named as defendants in a purported class action lawsuit filed in California state court. The lawsuit was filed by investors in certain~~ ~~iShares~~ ETFs (the "ETFs"), and alleges the defendants violated the federal securities laws by failing to adequately disclose in prospectuses issued by the ETFs the risks to the ETFs’ shareholders in the event of a "flash crash." The plaintiffs seek unspecified monetary and rescission damages. The plaintiffs’ complaint was dismissed in December 2016 and on January 6, 2017, the plaintiffs filed an amended complaint. On April 27, 2017, the court partially granted the defendants’ motion for judgment on the pleadings, dismissing certain of the plaintiffs’ claims. On September 18, 2017, the court issued a decision dismissing the remainder of the lawsuit after a one-day bench trial. On December 1, 2017, the plaintiffs appealed the dismissal of their lawsuit and, on January 23, 2020, the California Court of Appeal affirmed the trial court’s dismissal. Plaintiffs have asked the California Supreme Court to hear a further appeal of the dismissal. The defendants believe the claims in this lawsuit are without merit.

On April 5, 2017, BlackRock, Inc., BlackRock Institutional Trust Company, N.A. (“BTC”), the BlackRock, Inc. Retirement Committee and various sub-committees, and a BlackRock employee were named as defendants in a purported class action lawsuit brought in the US District Court for the Northern District of California by a former employee on behalf of all participants and beneficiaries in the BlackRock employee 401(k) Plan (the “Plan”) from April 5, 2011 to the present. The lawsuit generally alleges that the defendants breached their duties towards Plan participants in violation of the Employee Retirement Income Security Act of 1974 by, among other things, offering investment options that were overly expensive, underperformed unaffiliated peer funds, focused disproportionately on active versus passive strategies, and were unduly concentrated in investment options managed by BlackRock. On October 18, 2017, the plaintiffs filed an Amended Complaint, which, among other things, added as defendants certain current and former members of the BlackRock Retirement and Investment Committees. The Amended Complaint also included a new purported class claim on behalf of investors in certain Collective Trust Funds (“CTFs”) managed by BTC. Specifically, the plaintiffs allege that BTC, as fiduciary to the CTFs, engaged in self-dealing by, most significantly, selecting itself as the securities lending agent on terms that the plaintiffs claim were excessive. The Amended Complaint also alleged that BlackRock took undue risks in its management of securities lending cash reinvestment vehicles during the financial crisis. On August 23, 2018, the court granted permission to the plaintiffs to file a Second Amended Complaint (“SAC”) which added as defendants the BlackRock, Inc. Management Development and Compensation Committee, the Plan’s independent investment consultant and the Plan’s Administrative Committee and its members. On October 22, 2018, BlackRock filed a motion to dismiss the SAC, and on June 3, 2019, the plaintiffs filed a motion seeking to certify both the Plan and the CTF classes. On September 3, 2019, the court granted

BlackRock’s motion to dismiss part of the plaintiffs’ claim seeking to recover alleged losses in the securities lending vehicles but denied the motion to dismiss in all other respects. On February 11, 2020, the court denied the plaintiffs’ motion to certify the CTF class and granted their motion to certify the Plan class. On April 27, 2020, the Ninth Circuit denied plaintiffs’ request to immediately appeal the class certification ruling. The defendants believe the claims in this lawsuit are without merit.

In addition to the risk factors previously disclosed in BlackRock’s Annual Report on Form 10-K for the year ended December 31, 2019, BlackRock’s business, financial condition or results of operations could be materially adversely affected by any of the following risks.

The COVID-19 pandemic has caused and is causing significant harm to the global economy and may adversely affect our business, including our operations and financial condition, and may cause our assets under management (“AUM”), revenue and earnings to decline.

The extent to which COVID-19, and the related global economic crisis, affect our business, results of operations and financial condition, will depend on future developments that are highly uncertain and cannot be predicted, including the scope and duration of the pandemic and any recovery period, future actions taken by governmental authorities, central banks and other third parties (including new financial regulation and other regulatory reform) in response to the pandemic, and the effects on our products, clients, vendors and employees. Moreover, the effects of the COVID-19 pandemic may heighten the other risks described in the section entitled “Risk Factors” in our most recent Annual Report on Form 10-K and any subsequent ~~report~~reports filed with the Securities and Exchange Commission.

During the three months ended ~~March 31,~~September 30, 2020, the Company made the following purchases of its common stock, which is registered pursuant to Section 12(b) of the Exchange Act.

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $.01 par value	BLK	New York Stock Exchange
1.250% Notes due 2025	BLK25	New York Stock Exchange

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

		Page

Item 1.	Financial Statements (unaudited)

	Condensed Consolidated Statements of Financial Condition	1

	Condensed Consolidated Statements of Income	2

	Condensed Consolidated Statements of Comprehensive Income	3

	Condensed Consolidated Statements of Changes in Equity	4

	Condensed Consolidated Statements of Cash Flows	56

	Notes to Condensed Consolidated Financial Statements	67

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3539

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	6474

Item 4.	Controls and Procedures	6575

Item 1.	Legal Proceedings	6676

Item 1A.	Risk Factors	6877

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	6978

Item 6.	Exhibits	7079

	Three Months Ended
	March 31,
(in millions, except per share data)	2020		2019
Net income attributable to BlackRock, Inc., GAAP basis	$	806	$	1,053
Non-GAAP adjustment:
Charitable Contribution, net of tax		226		—
Net income attributable to BlackRock, Inc., as adjusted	$	1,032	$	1,053
Diluted weighted-average common shares outstanding (4)		156.4		159.3
Diluted earnings per common share, GAAP basis (4)	$	5.15	$	6.61
Diluted earnings per common share, as adjusted (4)	$	6.60	$	6.61

	Total Number of Shares Purchased⁽¹⁾		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs
January 1, 2020 through January 31, 2020		663,834	$	537.78		193,053		5,643,612
February 1, 2020 through February 29, 2020		483,633	$	523.38		483,604		5,160,008
March 1, 2020 through March 31, 2020		97,910	$	480.61		91,174		5,068,834
Total		1,245,377	$	527.69		767,831

Exhibit No.		Description

3.1(1)		Certificate of Elimination relating to the Preferred Stock, dated October 6, 2020.

31.1		Section 302 Certification of Chief Executive Officer

31.2		Section 302 Certification of Chief Financial Officer

32.1		Section 906 Certification of Chief Executive Officer and Chief Financial Officer

101.INS		Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH		Inline XBRL Taxonomy Extension Schema Document

101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document

104		Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

	BLACKROCK, INC.
	(Registrant)

	By:	/s/ Gary S. Shedlin
Date: ~~May 8,~~November 5, 2020		Gary S. Shedlin
		Senior Managing Director & Chief Financial Officer