Docoh
Loading...

BLK Blackrock

Filed: 14 Jan 22, 8:29am

Exhibit 99.1

 

 

 

 

 

 

INVESTOR RELATIONS:

Caroline Rodda      212.810.3442

MEDIA RELATIONS:

Brian Beades      212.810.5596

 

 

 

BlackRock Reports Full Year 2021 Diluted EPS of $38.22, or $39.18 as adjusted

Fourth Quarter 2021 Diluted EPS of $10.63, or $10.42 as adjusted

 

New York, January 14, 2022 – BlackRock, Inc. (NYSE: BLK) today reported financial results for the three months and year ended December 31, 2021.

$540 billion of full year total net inflows, reflects 6% organic asset growth and 11% organic base fee growth, led by record flows in ETFs and active strategies

$212 billion of quarterly total net inflows positive across all client types, investment styles and regions

20% increase in full year revenue includes record organic growth, record performance fees and continued growth in technology services revenue

31% increase in full year GAAP operating income and 20% increase in diluted EPS reflect the impact of a charitable contribution in 2020, which was excluded from as adjusted results  

19% growth in full year as adjusted operating income includes the impact of higher fund launch costs and amortization of intangible assets in the current year

16% increase in full year as adjusted diluted EPS also reflects a higher effective tax rate, partially offset by higher nonoperating income in the current year

$3.7 billion returned to shareholders in 2021, including $1.2 billion of share repurchases

18% increase in quarterly cash dividend to $4.88 per share approved by Board of Directors

 

Laurence D. Fink, Chairman and CEO:

“BlackRock delivered the strongest organic growth in our history, even as our assets under management reached new highs. We generated $540 billion of net inflows in 2021, including an industry leading $267 billion of active net inflows.

“Our business is more diversified than ever before – active strategies, including alternatives, contributed over 60% of 2021 organic base fee growth. Our industry-leading iShares® ETF platform remained a significant growth driver with record flows of $306 billion.  And our technology services businesses, powered by Aladdin®, delivered $1.3 billion in revenue with ACV up 13% year over year.

“Our record results across each of our strategic priorities demonstrate the benefits of continually investing in our platform over years ahead of our clients’ needs, and the tireless commitment of our employees. Our strategy is resonating – we’re building deeper partnerships with our clients and other stakeholders, and delivering durable returns for our shareholders.

“As the world continues to navigate uncertainty and profound shifts in economies and societies at large, BlackRock remains focused on helping our clients meet their investment goals. Every dollar that is entrusted to us, by every client, is treated with the same care and responsibility. BlackRock enters 2022 better positioned than ever – we remain confident in our ability to continue generating differentiated organic growth over the long-term and helping more and more people experience financial well-being.”

 

 

FINANCIAL RESULTS

(in millions

Q4

 

 

Q4

 

Full Year

 

except per share data)

2021

 

 

2020

 

2021

 

2020

 

AUM

$

10,010,143

 

 

$

8,676,680

 

$

10,010,143

 

$

8,676,680

 

% change

 

15

%

 

 

 

 

 

15

%

 

 

 

Average AUM

$

9,749,652

 

 

$

8,154,225

 

$

9,364,948

 

$

7,549,103

 

% change

 

20

%

 

 

 

 

 

24

%

 

 

 

Total net flows

$

211,736

 

 

$

126,933

 

$

539,654

 

$

390,838

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GAAP basis:

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

$

5,106

 

 

$

4,478

 

$

19,374

 

$

16,205

 

% change

 

14

%

 

 

 

 

 

20

%

 

 

 

Operating income

$

2,039

 

 

$

1,848

 

$

7,450

 

$

5,695

 

% change

 

10

%

 

 

 

 

 

31

%

 

 

 

Operating margin

 

39.9

%

 

 

41.3

%

 

38.5

%

 

35.1

%

Net income(1)

$

1,643

 

 

$

1,548

 

$

5,901

 

$

4,932

 

% change

 

6

%

 

 

 

 

 

20

%

 

 

 

Diluted EPS

$

10.63

 

 

$

10.02

 

$

38.22

 

$

31.85

 

% change

 

6

%

 

 

 

 

 

20

%

 

 

 

Weighted-average diluted shares

 

154.6

 

 

 

154.5

 

 

154.4

 

 

154.8

 

% change

 

0

%

 

 

 

 

 

0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As Adjusted:

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income(2)

$

2,056

 

 

$

1,848

 

$

7,478

 

$

6,284

 

% change

 

11

%

 

 

 

 

 

19

%

 

 

 

Operating margin(2)

 

45.5

%

 

 

46.6

%

 

45.2

%

 

44.9

%

Net income(1) (2)

$

1,611

 

 

$

1,573

 

$

6,049

 

$

5,237

 

% change

 

2

%

 

 

 

 

 

16

%

 

 

 

Diluted EPS(2)

$

10.42

 

 

$

10.18

 

$

39.18

 

$

33.82

 

% change

 

2

%

 

 

 

 

 

16

%

 

 

 

(1)

Net income represents net income attributable to BlackRock, Inc.

(2)

See notes (1) through (3) to the condensed consolidated statements of income and supplemental information on pages 10 through 12 for more information on as adjusted items and the reconciliation to GAAP.

NET FLOW HIGHLIGHTS

 

 

 

Q4

Full Year

(in billions)

2021

2021

Long-term net flows:

$

169

 

 

$

459

 

 

 

 

 

 

 

 

 

 

 

 

 

By region:

 

 

 

 

 

 

 

 

 

 

 

 

Americas

$

139

 

 

$

269

 

 

 

EMEA

 

5

 

 

 

119

 

 

 

APAC

 

25

 

 

 

71

 

 

 

 

 

 

 

 

 

 

 

 

 

By client type:

 

 

 

 

 

 

 

 

 

 

 

 

Retail:

$

22

 

 

$

102

 

 

 

 

US

 

13

 

 

 

60

 

 

 

 

International

 

9

 

 

 

42

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ETFs:

$

104

 

 

$

306

 

 

 

 

Core equity

 

42

 

 

 

110

 

 

 

 

Strategic

 

47

 

 

 

136

 

 

 

 

Precision

 

15

 

 

 

60

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Institutional:

$

43

 

 

$

51

 

 

 

 

Active

 

84

 

 

 

169

 

 

 

 

Index

 

(40

)

 

 

(118

)

 

 

 

 

 

 

 

 

 

 

 

 

Cash management net flows

$

44

 

 

$

94

 

 

 

 

 

 

 

 

 

 

 

 

 

Advisory net flows

$

(1

)

 

$

(13

)

 

 

 

 

 

 

 

 

 

 

 

 

Total net flows

$

212

 

 

$

540

 

 

 

 

 

 

 

 

1

 


 

 

 

BUSINESS RESULTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Q4 2021

 

 

 

 

 

 

 

 

 

Q4 2021

 

 

 

 

Base fees(1)

 

 

 

 

 

 

 

 

 

Base fees(1)

 

December 31, 2021

 

and securities

 

 

 

Q4 2021

 

December 31, 2021

 

and securities

 

AUM

 

lending revenue

 

 

(in millions), (unaudited)

Net flows

 

AUM

 

lending revenue

 

% of Total

 

% of Total

 

 

RESULTS BY CLIENT TYPE

Retail

$

21,521

 

$

1,040,053

 

$

1,310

 

 

10

%

 

33

%

 

ETFs

 

103,943

 

 

3,267,354

 

 

1,581

 

 

33

%

 

40

%

 

Institutional:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Active

 

83,509

 

 

1,756,717

 

 

684

 

 

18

%

 

17

%

 

Index

 

(40,421

)

 

3,181,652

 

 

268

 

 

31

%

 

7

%

 

Total institutional

 

43,088

 

 

4,938,369

 

 

952

 

 

49

%

 

24

%

 

Long-term

 

168,552

 

 

9,245,776

 

 

3,843

 

 

92

%

 

97

%

 

Cash management

 

43,912

 

 

755,057

 

 

125

 

 

8

%

 

3

%

 

Advisory

 

(728

)

 

9,310

 

 

-

 

 

-

 

 

-

 

 

Total

$

211,736

 

$

10,010,143

 

$

3,968

 

 

100

%

 

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

RESULTS BY INVESTMENT STYLE

Active

$

100,506

 

$

2,606,325

 

$

1,946

 

 

26

%

 

49

%

 

Index and ETFs

 

68,046

 

 

6,639,451

 

 

1,897

 

 

66

%

 

48

%

 

Long-term

 

168,552

 

 

9,245,776

 

 

3,843

 

 

92

%

 

97

%

 

Cash management

 

43,912

 

 

755,057

 

 

125

 

 

8

%

 

3

%

 

Advisory

 

(728

)

 

9,310

 

 

-

 

 

-

 

 

-

 

 

Total

$

211,736

 

$

10,010,143

 

$

3,968

 

 

100

%

 

100

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

RESULTS BY PRODUCT TYPE

Equity

$

45,105

 

$

5,342,360

 

$

2,092

 

 

53

%

 

53

%

 

Fixed income

 

100,893

 

 

2,822,041

 

 

989

 

 

28

%

 

25

%

 

Multi-asset

 

17,008

 

 

816,494

 

 

373

 

 

8

%

 

9

%

 

Alternatives

 

5,546

 

 

264,881

 

 

389

 

 

3

%

 

10

%

 

Long-term

 

168,552

 

 

9,245,776

 

 

3,843

 

 

92

%

 

97

%

 

Cash management

 

43,912

 

 

755,057

 

 

125

 

 

8

%

 

3

%

 

Advisory

 

(728

)

 

9,310

 

 

-

 

 

-

 

 

-

 

 

Total

$

211,736

 

$

10,010,143

 

$

3,968

 

 

100

%

 

100

%

 

 

(1)

Base fees include investment advisory and administration fees.

INVESTMENT PERFORMANCE AT December 31, 2021(1)

 

 

One-year period

 

Three-year period

 

Five-year period

 

Fixed income:

 

 

 

 

 

 

 

 

 

Actively managed AUM above benchmark or peer median

 

 

 

 

 

 

 

 

 

Taxable

61%

 

87%

 

88%

 

Tax-exempt

76%

 

79%

 

81%

 

Index AUM within or above applicable tolerance

85%

 

93%

 

94%

 

Equity:

 

 

 

 

 

 

 

 

 

Actively managed AUM above benchmark or peer median

 

 

 

 

 

 

 

 

 

Fundamental

52%

 

72%

 

78%

 

Systematic

66%

 

72%

 

93%

 

Index AUM within or above applicable tolerance

97%

 

97%

 

99%

 

 

(1)

Past performance is not indicative of future results. The performance information shown is based on preliminary available data. Please refer to page 13 for performance disclosure detail.

CAPITAL MANAGEMENT

BlackRock’s Board of Directors approved an 18% increase in the quarterly cash dividend to $4.88 per share, payable March 23, 2022, to shareholders of record at the close of business on March 7, 2022.

TELECONFERENCE, WEBCAST AND PRESENTATION INFORMATION

Chairman and Chief Executive Officer, Laurence D. Fink, President, Robert S. Kapito, and Chief Financial Officer, Gary S. Shedlin, will host a teleconference call for investors and analysts on Friday, January 14, 2022 at 8:30 a.m. (Eastern Time). Members of the public who are interested in participating in the teleconference should dial, from the United States, (800) 374-0176, or from outside the United States, (706) 679-8281, shortly before 8:30 a.m. and reference the BlackRock Conference Call (ID Number 9989827). A live, listen-only webcast will also be available via the investor relations section of www.blackrock.com.

Both the teleconference and webcast will be available for replay by 11:30 a.m. (Eastern Time) on Friday, January 14, 2022 and ending at midnight on Friday, January 28, 2022. To access the replay of the teleconference, callers from the United States should dial (855) 859-2056 and callers from outside the United States should dial (404) 537-3406 and enter the Conference ID Number 9989827. To access the webcast, please visit the investor relations section of www.blackrock.com.

ABOUT BLACKROCK

BlackRock’s purpose is to help more and more people experience financial well-being. As a fiduciary to investors and a leading provider of financial technology, we help millions of people build savings that serve them throughout their lives by making investing easier and more affordable. For additional information on BlackRock, please visit www.blackrock.com/corporate | Twitter: @blackrock | LinkedIn: www.linkedin.com/company/blackrock.

2

 


 

 

 

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND SUPPLEMENTAL INFORMATION

(in millions, except shares and per share data), (unaudited)

 

 

 

 

 

 

 

 

 

Three Months

 

 

 

 

 

 

Three Months Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

September 30,

 

 

 

 

 

 

2021

 

 

2020

 

 

Change

 

 

2021

 

 

Change

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment advisory, administration fees and

  securities lending revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment advisory and administration fees

$

3,832

 

 

$

3,262

 

 

$

570

 

 

$

3,791

 

 

$

41

 

Securities lending revenue

 

136

 

 

 

131

 

 

 

5

 

 

 

152

 

 

 

(16

)

Total investment advisory, administration fees and

  securities lending revenue

 

3,968

 

 

 

3,393

 

 

 

575

 

 

 

3,943

 

 

 

25

 

Investment advisory performance fees

 

329

 

 

 

419

 

 

 

(90

)

 

 

345

 

 

 

(16

)

Technology services revenue

 

339

 

 

 

305

 

 

 

34

 

 

 

320

 

 

 

19

 

Distribution fees

 

411

 

 

 

314

 

 

 

97

 

 

 

401

 

 

 

10

 

Advisory and other revenue

 

59

 

 

 

47

 

 

 

12

 

 

 

41

 

 

 

18

 

Total revenue

 

5,106

 

 

 

4,478

 

 

 

628

 

 

 

5,050

 

 

 

56

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Employee compensation and benefits

 

1,559

 

 

 

1,341

 

 

 

218

 

 

 

1,527

 

 

 

32

 

Distribution and servicing costs

 

587

 

 

 

505

 

 

 

82

 

 

 

585

 

 

 

2

 

Direct fund expense

 

319

 

 

 

283

 

 

 

36

 

 

 

354

 

 

 

(35

)

General and administration expense

 

564

 

 

 

474

 

 

 

90

 

 

 

611

 

 

 

(47

)

Amortization of intangible assets

 

38

 

 

 

27

 

 

 

11

 

 

 

38

 

 

 

-

 

Total expense

 

3,067

 

 

 

2,630

 

 

 

437

 

 

 

3,115

 

 

 

(48

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

2,039

 

 

 

1,848

 

 

 

191

 

 

 

1,935

 

 

 

104

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonoperating income (expense)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net gain (loss) on investments

 

75

 

 

 

345

 

 

 

(270

)

 

 

370

 

 

 

(295

)

Interest and dividend income

 

46

 

 

 

28

 

 

 

18

 

 

 

14

 

 

 

32

 

Interest expense

 

(50

)

 

 

(54

)

 

 

4

 

 

 

(48

)

 

 

(2

)

Total nonoperating income (expense)

 

71

 

 

 

319

 

 

 

(248

)

 

 

336

 

 

 

(265

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

2,110

 

 

 

2,167

 

 

 

(57

)

 

 

2,271

 

 

 

(161

)

Income tax expense

 

478

 

 

 

427

 

 

 

51

 

 

 

518

 

 

 

(40

)

Net income

 

1,632

 

 

 

1,740

 

 

 

(108

)

 

 

1,753

 

 

 

(121

)

Less:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to noncontrolling

  interests

 

(11

)

 

 

192

 

 

 

(203

)

 

 

72

 

 

 

(83

)

Net income attributable to BlackRock, Inc.

$

1,643

 

 

$

1,548

 

 

$

95

 

 

$

1,681

 

 

$

(38

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

151,822,226

 

 

 

152,515,168

 

 

 

(692,942

)

 

 

152,120,927

 

 

 

(298,701

)

Diluted

 

154,564,198

 

 

 

154,512,860

 

 

 

51,338

 

 

 

154,343,277

 

 

 

220,921

 

Earnings per share attributable to BlackRock, Inc.

   common stockholders

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

$

10.82

 

 

$

10.15

 

 

$

0.67

 

 

$

11.05

 

 

$

(0.23

)

Diluted

$

10.63

 

 

$

10.02

 

 

$

0.61

 

 

$

10.89

 

 

$

(0.26

)

Cash dividends declared and paid per share

$

4.13

 

 

$

3.63

 

 

$

0.50

 

 

$

4.13

 

 

$

-

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental information:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AUM (end of period)

$

10,010,143

 

 

$

8,676,680

 

 

$

1,333,463

 

 

$

9,463,662

 

 

$

546,481

 

Shares outstanding (end of period)

 

151,684,491

 

 

 

152,532,885

 

 

 

(848,394

)

 

 

151,988,234

 

 

 

(303,743

)

GAAP:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating margin

 

39.9

%

 

 

41.3

%

 

 

(140

) bps

 

 

38.3

%

 

 

160

  bps

Effective tax rate

 

22.6

%

 

 

21.6

%

 

 

100

  bps

 

 

23.6

%

 

 

(100

) bps

As adjusted:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income (1)

$

2,056

 

 

$

1,848

 

 

$

208

 

 

$

1,946

 

 

$

110

 

Operating margin (1)

 

45.5

%

 

 

46.6

%

 

 

(110

) bps

 

 

45.8

%

 

 

(30

) bps

Nonoperating income (expense), less net income

     (loss) attributable to noncontrolling interests (2)

$

82

 

 

$

127

 

 

$

(45

)

 

$

264

 

 

$

(182

)

Net income attributable to BlackRock, Inc. (3)

$

1,611

 

 

$

1,573

 

 

$

38

 

 

$

1,690

 

 

$

(79

)

Diluted earnings attributable to BlackRock, Inc.

     common stockholders per share (3)

$

10.42

 

 

$

10.18

 

 

$

0.24

 

 

$

10.95

 

 

$

(0.53

)

Effective tax rate

 

24.6

%

 

 

20.3

%

 

 

430

  bps

 

 

23.6

%

 

 

100

  bps

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

See pages 10 through 12 for the reconciliation to GAAP and notes (1) through (3) to the condensed consolidated statements of income and supplemental information for more information on as adjusted items.

 

 

 

 

 

 

 

 

3

 


 

 

 

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND SUPPLEMENTAL INFORMATION

(in millions, except shares and per share data), (unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

2021

 

 

2020

 

 

Change

 

Revenue

 

 

 

 

 

 

 

 

 

 

 

Investment advisory, administration fees and

  securities lending revenue:

 

 

 

 

 

 

 

 

 

 

 

Investment advisory and administration fees

$

14,705

 

 

$

11,987

 

 

$

2,718

 

Securities lending revenue

 

555

 

 

 

652

 

 

 

(97

)

Total investment advisory, administration fees and

  securities lending revenue

 

15,260

 

 

 

12,639

 

 

 

2,621

 

Investment advisory performance fees

 

1,143

 

 

 

1,104

 

 

 

39

 

Technology services revenue

 

1,281

 

 

 

1,139

 

 

 

142

 

Distribution fees

 

1,521

 

 

 

1,131

 

 

 

390

 

Advisory and other revenue

 

169

 

 

 

192

 

 

 

(23

)

Total revenue

 

19,374

 

 

 

16,205

 

 

 

3,169

 

 

 

 

 

 

 

 

 

 

 

 

 

Expense

 

 

 

 

 

 

 

 

 

 

 

Employee compensation and benefits

 

6,043

 

 

 

5,041

 

 

 

1,002

 

Distribution and servicing costs

 

2,200

 

 

 

1,835

 

 

 

365

 

Direct fund expense

 

1,313

 

 

 

1,063

 

 

 

250

 

General and administration expense

 

2,221

 

 

 

2,465

 

 

 

(244

)

Amortization of intangible assets

 

147

 

 

 

106

 

 

 

41

 

Total expense

 

11,924

 

 

 

10,510

 

 

 

1,414

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

7,450

 

 

 

5,695

 

 

 

1,755

 

 

 

 

 

 

 

 

 

 

 

 

 

Nonoperating income (expense)

 

 

 

 

 

 

 

 

 

 

 

Net gain (loss) on investments

 

841

 

 

 

972

 

 

 

(131

)

Interest and dividend income

 

87

 

 

 

62

 

 

 

25

 

Interest expense

 

(205

)

 

 

(205

)

 

 

-

 

Total nonoperating income (expense)

 

723

 

 

 

829

 

 

 

(106

)

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

8,173

 

 

 

6,524

 

 

 

1,649

 

Income tax expense

 

1,968

 

 

 

1,238

 

 

 

730

 

Net income

 

6,205

 

 

 

5,286

 

 

 

919

 

Less:

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) attributable to noncontrolling

  interests

 

304

 

 

 

354

 

 

 

(50

)

Net income attributable to BlackRock, Inc.

$

5,901

 

 

$

4,932

 

 

$

969

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted-average common shares outstanding

 

 

 

 

 

 

 

 

 

 

 

Basic

 

152,236,047

 

 

 

153,489,422

 

 

 

(1,253,375

)

Diluted

 

154,404,357

 

 

 

154,840,582

 

 

 

(436,225

)

Earnings per share attributable to BlackRock, Inc.

   common stockholders

 

 

 

 

 

 

 

 

 

 

 

Basic

$

38.76

 

 

$

32.13

 

 

$

6.63

 

Diluted

$

38.22

 

 

$

31.85

 

 

$

6.37

 

Cash dividends declared and paid per share

$

16.52

 

 

$

14.52

 

 

$

2.00

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental information:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AUM (end of period)

$

10,010,143

 

 

$

8,676,680

 

 

$

1,333,463

 

Shares outstanding (end of period)

 

151,684,491

 

 

 

152,532,885

 

 

 

(848,394

)

GAAP:

 

 

 

 

 

 

 

 

 

 

 

Operating margin

 

38.5

%

 

 

35.1

%

 

 

340

bps

Effective tax rate

 

25.0

%

 

 

20.1

%

 

 

490

bps

As adjusted:

 

 

 

 

 

 

 

 

 

 

 

Operating income (1)

$

7,478

 

 

$

6,284

 

 

$

1,194

 

Operating margin (1)

 

45.2

%

 

 

44.9

%

 

 

30

bps

Nonoperating income (expense), less net income

     (loss) attributable to noncontrolling interests (2)

$

419

 

 

$

353

 

 

$

66

 

Net income attributable to BlackRock, Inc. (3)

$

6,049

 

 

$

5,237

 

 

$

812

 

Diluted earnings attributable to BlackRock, Inc.

     common stockholders per share (3)

$

39.18

 

 

$

33.82

 

 

$

5.36

 

Effective tax rate

 

23.4

%

 

 

21.1

%

 

 

230

bps

 

 

 

 

 

 

 

 

 

 

 

 

See pages 10 through 12 for the reconciliation to GAAP and notes (1) through (3) to the condensed consolidated statements of income and supplemental information for more information on as adjusted items.

 

4

 


 

 

 

ASSETS UNDER MANAGEMENT

(in millions), (unaudited)

 

Current Quarter Component Changes by Client Type and Product Type

 

 

 

 

 

 

Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30,

 

 

inflows

 

 

Market

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

2021

 

 

(outflows)

 

 

change

 

 

FX impact(1)

 

 

2021

 

 

Average AUM(2)

 

Retail:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

$

445,737

 

 

$

7,907

 

 

$

18,851

 

 

$

(558

)

 

$

471,937

 

 

$

460,066

 

Fixed income

 

359,161

 

 

 

8,859

 

 

 

(2,259

)

 

 

(455

)

 

 

365,306

 

 

 

361,191

 

Multi-asset

 

150,953

 

 

 

2,310

 

 

 

2,288

 

 

 

(90

)

 

 

155,461

 

 

 

153,559

 

Alternatives

 

44,776

 

 

 

2,445

 

 

 

175

 

 

 

(47

)

 

 

47,349

 

 

 

45,848

 

Retail subtotal

 

1,000,627

 

 

 

21,521

 

 

 

19,055

 

 

 

(1,150

)

 

 

1,040,053

 

 

 

1,020,664

 

ETFs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

2,250,849

 

 

 

70,070

 

 

 

128,878

 

 

 

(2,549

)

 

 

2,447,248

 

 

 

2,355,110

 

Fixed income

 

716,596

 

 

 

33,055

 

 

 

(3,069

)

 

 

(1,209

)

 

 

745,373

 

 

 

727,561

 

Multi-asset

 

8,150

 

 

 

727

 

 

 

239

 

 

 

3

 

 

 

9,119

 

 

 

8,563

 

Alternatives

 

63,156

 

 

 

91

 

 

 

2,363

 

 

 

4

 

 

 

65,614

 

 

 

64,682

 

ETFs subtotal

 

3,038,751

 

 

 

103,943

 

 

 

128,411

 

 

 

(3,751

)

 

 

3,267,354

 

 

 

3,155,916

 

Institutional:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Active:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

182,232

 

 

 

7,665

 

 

 

10,297

 

 

 

(214

)

 

 

199,980

 

 

 

189,116

 

Fixed income

 

708,698

 

 

 

58,595

 

 

 

1,601

 

 

 

(1,492

)

 

 

767,402

 

 

 

740,525

 

Multi-asset

 

605,297

 

 

 

13,874

 

 

 

26,265

 

 

 

(2,485

)

 

 

642,951

 

 

 

622,619

 

Alternatives

 

142,318

 

 

 

3,375

 

 

 

807

 

 

 

(116

)

 

 

146,384

 

 

 

143,737

 

Active subtotal

 

1,638,545

 

 

 

83,509

 

 

 

38,970

 

 

 

(4,307

)

 

 

1,756,717

 

 

 

1,695,997

 

Index:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

2,119,592

 

 

 

(40,537

)

 

 

149,731

 

 

 

(5,591

)

 

 

2,223,195

 

 

 

2,176,366

 

Fixed income

 

929,444

 

 

 

384

 

 

 

19,556

 

 

 

(5,424

)

 

 

943,960

 

 

 

947,128

 

Multi-asset

 

8,758

 

 

 

97

 

 

 

191

 

 

 

(83

)

 

 

8,963

 

 

 

10,522

 

Alternatives

 

5,898

 

 

 

(365

)

 

 

27

 

 

 

(26

)

 

 

5,534

 

 

 

5,581

 

Index subtotal

 

3,063,692

 

 

 

(40,421

)

 

 

169,505

 

 

 

(11,124

)

 

 

3,181,652

 

 

 

3,139,597

 

Institutional subtotal

 

4,702,237

 

 

 

43,088

 

 

 

208,475

 

 

 

(15,431

)

 

 

4,938,369

 

 

 

4,835,594

 

Long-term

 

8,741,615

 

 

 

168,552

 

 

 

355,941

 

 

 

(20,332

)

 

 

9,245,776

 

 

 

9,012,174

 

Cash management

 

712,015

 

 

 

43,912

 

 

 

(142

)

 

 

(728

)

 

 

755,057

 

 

 

727,823

 

Advisory(3)

 

10,032

 

 

 

(728

)

 

 

(5

)

 

 

11

 

 

 

9,310

 

 

 

9,655

 

Total

$

9,463,662

 

 

$

211,736

 

 

$

355,794

 

 

$

(21,049

)

 

$

10,010,143

 

 

$

9,749,652

 

Current Quarter Component Changes by Investment Style and Product Type (Long-Term)

 

 

 

 

 

 

Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30,

 

 

inflows

 

 

Market

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

2021

 

 

(outflows)

 

 

change

 

 

FX impact(1)

 

 

2021

 

 

Average AUM(2)

 

Active:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

$

475,232

 

 

$

13,919

 

 

$

18,745

 

 

$

(793

)

 

$

507,103

 

 

$

490,609

 

Fixed income

 

1,045,297

 

 

 

64,586

 

 

 

(789

)

 

 

(2,009

)

 

 

1,107,085

 

 

 

1,078,221

 

Multi-asset

 

756,245

 

 

 

16,181

 

 

 

28,554

 

 

 

(2,576

)

 

 

798,404

 

 

 

776,171

 

Alternatives

 

187,093

 

 

 

5,820

 

 

 

983

 

 

 

(163

)

 

 

193,733

 

 

 

189,584

 

Active subtotal

 

2,463,867

 

 

 

100,506

 

 

 

47,493

 

 

 

(5,541

)

 

 

2,606,325

 

 

 

2,534,585

 

Index and ETFs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ETFs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

2,250,849

 

 

 

70,070

 

 

 

128,878

 

 

 

(2,549

)

 

 

2,447,248

 

 

 

2,355,110

 

Fixed income

 

716,596

 

 

 

33,055

 

 

 

(3,069

)

 

 

(1,209

)

 

 

745,373

 

 

 

727,561

 

Multi-asset

 

8,150

 

 

 

727

 

 

 

239

 

 

 

3

 

 

 

9,119

 

 

 

8,563

 

Alternatives

 

63,156

 

 

 

91

 

 

 

2,363

 

 

 

4

 

 

 

65,614

 

 

 

64,682

 

ETFs subtotal

 

3,038,751

 

 

 

103,943

 

 

 

128,411

 

 

 

(3,751

)

 

 

3,267,354

 

 

 

3,155,916

 

Non-ETF Index:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

2,272,329

 

 

 

(38,884

)

 

 

160,134

 

 

 

(5,570

)

 

 

2,388,009

 

 

 

2,334,939

 

Fixed income

 

952,006

 

 

 

3,252

 

 

 

19,687

 

 

 

(5,362

)

 

 

969,583

 

 

 

970,623

 

Multi-asset

 

8,763

 

 

 

100

 

 

 

190

 

 

 

(82

)

 

 

8,971

 

 

 

10,529

 

Alternatives

 

5,899

 

 

 

(365

)

 

 

26

 

 

 

(26

)

 

 

5,534

 

 

 

5,582

 

Non-ETF Index subtotal

 

3,238,997

 

 

 

(35,897

)

 

 

180,037

 

 

 

(11,040

)

 

 

3,372,097

 

 

 

3,321,673

 

Index and ETFs subtotal

 

6,277,748

 

 

 

68,046

 

 

 

308,448

 

 

 

(14,791

)

 

 

6,639,451

 

 

 

6,477,589

 

Long-term

$

8,741,615

 

 

$

168,552

 

 

$

355,941

 

 

$

(20,332

)

 

$

9,245,776

 

 

$

9,012,174

 

Current Quarter Component Changes by Product Type (Long-Term)

 

 

 

 

 

 

Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30,

 

 

inflows

 

 

Market

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

2021

 

 

(outflows)

 

 

change

 

 

FX impact(1)

 

 

2021

 

 

Average AUM(2)

 

Equity

$

4,998,410

 

 

$

45,105

 

 

$

307,757

 

 

$

(8,912

)

 

$

5,342,360

 

 

$

5,180,658

 

Fixed income

 

2,713,899

 

 

 

100,893

 

 

 

15,829

 

 

 

(8,580

)

 

 

2,822,041

 

 

 

2,776,405

 

Multi-asset

 

773,158

 

 

 

17,008

 

 

 

28,983

 

 

 

(2,655

)

 

 

816,494

 

 

 

795,263

 

Alternatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Illiquid alternatives

 

98,321

 

 

 

3,805

 

 

 

602

 

 

 

(149

)

 

 

102,579

 

 

 

99,823

 

Liquid alternatives

 

85,052

 

 

 

1,871

 

 

 

387

 

 

 

38

 

 

 

87,348

 

 

 

85,990

 

Currency and commodities(4)

 

72,775

 

 

 

(130

)

 

 

2,383

 

 

 

(74

)

 

 

74,954

 

 

 

74,035

 

Alternatives subtotal

 

256,148

 

 

 

5,546

 

 

 

3,372

 

 

 

(185

)

 

 

264,881

 

 

 

259,848

 

Long-term

$

8,741,615

 

 

$

168,552

 

 

$

355,941

 

 

$

(20,332

)

 

$

9,245,776

 

 

$

9,012,174

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Foreign exchange reflects the impact of translating non-US dollar denominated AUM into US dollars for reporting purposes.

(2)

Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing four months.

(3)

Advisory AUM represents mandates linked to purchases and disposition of assets and portfolios on behalf of official institutions and long-term portfolio liquidation assignments.

(4)

Amounts include commodity ETFs.

 

5

 


 

 

 

ASSETS UNDER MANAGEMENT

(in millions), (unaudited)

Year-over-Year Component Changes by Client Type and Product Type

 

 

 

 

 

 

Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

 

inflows

 

 

 

 

 

 

Market

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

2020

 

 

(outflows)

 

 

Acquisition(1)

 

 

change

 

 

FX impact(2)

 

 

2021

 

 

Average AUM(3)

 

Retail:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

$

338,434

 

 

$

42,060

 

 

$

41,324

 

 

$

54,310

 

 

$

(4,191

)

 

$

471,937

 

 

$

428,218

 

Fixed income

 

340,468

 

 

 

34,870

 

 

 

-

 

 

 

(6,716

)

 

 

(3,316

)

 

 

365,306

 

 

 

356,075

 

Multi-asset

 

132,624

 

 

 

12,579

 

 

 

-

 

 

 

10,793

 

 

 

(535

)

 

 

155,461

 

 

 

145,903

 

Alternatives

 

34,391

 

 

 

12,584

 

 

 

-

 

 

 

644

 

 

 

(270

)

 

 

47,349

 

 

 

41,413

 

Retail subtotal

 

845,917

 

 

 

102,093

 

 

 

41,324

 

 

 

59,031

 

 

 

(8,312

)

 

 

1,040,053

 

 

 

971,609

 

ETFs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

1,905,101

 

 

 

222,855

 

 

 

-

 

 

 

331,275

 

 

 

(11,983

)

 

 

2,447,248

 

 

 

2,199,698

 

Fixed income

 

690,033

 

 

 

78,858

 

 

 

-

 

 

 

(17,894

)

 

 

(5,624

)

 

 

745,373

 

 

 

703,004

 

Multi-asset

 

6,268

 

 

 

2,266

 

 

 

-

 

 

 

589

 

 

 

(4

)

 

 

9,119

 

 

 

7,607

 

Alternatives

 

67,605

 

 

 

1,555

 

 

 

-

 

 

 

(3,475

)

 

 

(71

)

 

 

65,614

 

 

 

66,023

 

ETFs subtotal

 

2,669,007

 

 

 

305,534

 

 

 

-

 

 

 

310,495

 

 

 

(17,682

)

 

 

3,267,354

 

 

 

2,976,332

 

Institutional:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Active:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

169,522

 

 

 

6,104

 

 

 

-

 

 

 

26,852

 

 

 

(2,498

)

 

 

199,980

 

 

 

182,054

 

Fixed income

 

716,269

 

 

 

64,200

 

 

 

-

 

 

 

(5,428

)

 

 

(7,639

)

 

 

767,402

 

 

 

720,006

 

Multi-asset

 

511,242

 

 

 

82,981

 

 

 

-

 

 

 

59,919

 

 

 

(11,191

)

 

 

642,951

 

 

 

573,144

 

Alternatives

 

127,429

 

 

 

15,782

 

 

 

-

 

 

 

4,489

 

 

 

(1,316

)

 

 

146,384

 

 

 

137,630

 

Active subtotal

 

1,524,462

 

 

 

169,067

 

 

 

-

 

 

 

85,832

 

 

 

(22,644

)

 

 

1,756,717

 

 

 

1,612,834

 

Index:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

2,006,749

 

 

 

(169,338

)

 

 

-

 

 

 

413,914

 

 

 

(28,130

)

 

 

2,223,195

 

 

 

2,123,482

 

Fixed income

 

927,718

 

 

 

52,409

 

 

 

-

 

 

 

(5,892

)

 

 

(30,275

)

 

 

943,960

 

 

 

937,784

 

Multi-asset

 

8,599

 

 

 

6

 

 

 

-

 

 

 

708

 

 

 

(350

)

 

 

8,963

 

 

 

9,424

 

Alternatives

 

5,617

 

 

 

(902

)

 

 

-

 

 

 

933

 

 

 

(114

)

 

 

5,534

 

 

 

5,633

 

Index subtotal

 

2,948,683

 

 

 

(117,825

)

 

 

-

 

 

 

409,663

 

 

 

(58,869

)

 

 

3,181,652

 

 

 

3,076,323

 

Institutional subtotal

 

4,473,145

 

 

 

51,242

 

 

 

-

 

 

 

495,495

 

 

 

(81,513

)

 

 

4,938,369

 

 

 

4,689,157

 

Long-term

 

7,988,069

 

 

 

458,869

 

 

 

41,324

 

 

 

865,021

 

 

 

(107,507

)

 

 

9,245,776

 

 

 

8,637,098

 

Cash management

 

666,252

 

 

 

94,043

 

 

 

-

 

 

 

(1,137

)

 

 

(4,101

)

 

 

755,057

 

 

 

711,160

 

Advisory(4)

 

22,359

 

 

 

(13,258

)

 

 

-

 

 

 

195

 

 

 

14

 

 

 

9,310

 

 

 

16,690

 

Total

$

8,676,680

 

 

$

539,654

 

 

$

41,324

 

 

$

864,079

 

 

$

(111,594

)

 

$

10,010,143

 

 

$

9,364,948

 

Year-over-Year Component Changes by Investment Style and Product Type (Long-Term)

 

 

 

 

 

 

Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

 

inflows

 

 

 

 

 

 

Market

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

2020

 

 

(outflows)

 

 

Acquisition(1)

 

 

change

 

 

FX impact(2)

 

 

2021

 

 

Average AUM(3)

 

Active:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

$

410,189

 

 

$

48,773

 

 

$

-

 

 

$

53,689

 

 

$

(5,548

)

 

$

507,103

 

 

$

466,291

 

Fixed income

 

1,035,015

 

 

 

94,047

 

 

 

-

 

 

 

(11,322

)

 

 

(10,655

)

 

 

1,107,085

 

 

 

1,053,764

 

Multi-asset

 

643,864

 

 

 

95,555

 

 

 

-

 

 

 

70,711

 

 

 

(11,726

)

 

 

798,404

 

 

 

719,041

 

Alternatives

 

161,819

 

 

 

28,365

 

 

 

-

 

 

 

5,134

 

 

 

(1,585

)

 

 

193,733

 

 

 

179,043

 

Active subtotal

 

2,250,887

 

 

 

266,740

 

 

 

-

 

 

 

118,212

 

 

 

(29,514

)

 

 

2,606,325

 

 

 

2,418,139

 

Index and ETFs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ETFs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

1,905,101

 

 

 

222,855

 

 

 

-

 

 

 

331,275

 

 

 

(11,983

)

 

 

2,447,248

 

 

 

2,199,698

 

Fixed income

 

690,033

 

 

 

78,858

 

 

 

-

 

 

 

(17,894

)

 

 

(5,624

)

 

 

745,373

 

 

 

703,004

 

Multi-asset

 

6,268

 

 

 

2,266

 

 

 

-

 

 

 

589

 

 

 

(4

)

 

 

9,119

 

 

 

7,607

 

Alternatives

 

67,605

 

 

 

1,555

 

 

 

-

 

 

 

(3,475

)

 

 

(71

)

 

 

65,614

 

 

 

66,023

 

ETFs subtotal

 

2,669,007

 

 

 

305,534

 

 

 

-

 

 

 

310,495

 

 

 

(17,682

)

 

 

3,267,354

 

 

 

2,976,332

 

Non-ETF Index:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

2,104,516

 

 

 

(169,947

)

 

 

41,324

 

 

 

441,387

 

 

 

(29,271

)

 

 

2,388,009

 

 

 

2,267,463

 

Fixed income

 

949,440

 

 

 

57,432

 

 

 

-

 

 

 

(6,714

)

 

 

(30,575

)

 

 

969,583

 

 

 

960,101

 

Multi-asset

 

8,601

 

 

 

11

 

 

 

-

 

 

 

709

 

 

 

(350

)

 

 

8,971

 

 

 

9,430

 

Alternatives

 

5,618

 

 

 

(901

)

 

 

-

 

 

 

932

 

 

 

(115

)

 

 

5,534

 

 

 

5,633

 

Non-ETF Index subtotal

 

3,068,175

 

 

 

(113,405

)

 

 

41,324

 

 

 

436,314

 

 

 

(60,311

)

 

 

3,372,097

 

 

 

3,242,627

 

Index and ETFs subtotal

 

5,737,182

 

 

 

192,129

 

 

 

41,324

 

 

 

746,809

 

 

 

(77,993

)

 

 

6,639,451

 

 

 

6,218,959

 

Long-term

$

7,988,069

 

 

$

458,869

 

 

$

41,324

 

 

$

865,021

 

 

$

(107,507

)

 

$

9,245,776

 

 

$

8,637,098

 

Year-over-Year Component Changes by Product Type (Long-Term)

 

 

 

 

 

 

Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

 

inflows

 

 

 

 

 

 

Market

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

2020

 

 

(outflows)

 

 

Acquisition(1)

 

 

change

 

 

FX impact(2)

 

 

2021

 

 

Average AUM(3)

 

Equity

$

4,419,806

 

 

$

101,681

 

 

$

41,324

 

 

$

826,351

 

 

$

(46,802

)

 

$

5,342,360

 

 

$

4,933,452

 

Fixed income

 

2,674,488

 

 

 

230,337

 

 

 

-

 

 

 

(35,930

)

 

 

(46,854

)

 

 

2,822,041

 

 

 

2,716,869

 

Multi-asset

 

658,733

 

 

 

97,832

 

 

 

-

 

 

 

72,009

 

 

 

(12,080

)

 

 

816,494

 

 

 

736,078

 

Alternatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Illiquid alternatives

 

85,770

 

 

 

16,120

 

 

 

-

 

 

 

1,750

 

 

 

(1,061

)

 

 

102,579

 

 

 

94,768

 

Liquid alternatives

 

73,218

 

 

 

11,328

 

 

 

-

 

 

 

3,129

 

 

 

(327

)

 

 

87,348

 

 

 

80,866

 

Currency and commodities(5)

 

76,054

 

 

 

1,571

 

 

 

-

 

 

 

(2,288

)

 

 

(383

)

 

 

74,954

 

 

 

75,065

 

Alternatives subtotal

 

235,042

 

 

 

29,019

 

 

 

-

 

 

 

2,591

 

 

 

(1,771

)

 

 

264,881

 

 

 

250,699

 

Long-term

$

7,988,069

 

 

$

458,869

 

 

$

41,324

 

 

$

865,021

 

 

$

(107,507

)

 

$

9,245,776

 

 

$

8,637,098

 

 

(1)

Amounts include AUM attributable to the acquisition of Aperio Group, LLC on February 1, 2021 (the “Aperio Transaction”).

(2)

Foreign exchange reflects the impact of translating non-US dollar denominated AUM into US dollars for reporting purposes.

(3)

Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing thirteen months.

(4)

Advisory AUM represents mandates linked to purchases and disposition of assets and portfolios on behalf of official institutions and long-term portfolio liquidation assignments.

(5)

Amounts include commodity ETFs.

 

 

6

 


 

 

 

SUMMARY OF REVENUE

 

Three Months

 

 

 

 

 

 

Three Months

 

 

 

 

 

 

Year

 

 

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

September 30,

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

(in millions), (unaudited)

2021

 

 

2020

 

 

Change

 

 

2021

 

 

Change

 

 

2021

 

 

2020

 

 

Change

 

 

Investment advisory, administration fees and

   securities lending revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Active

$

680

 

 

$

501

 

 

$

179

 

 

$

674

 

 

$

6

 

 

$

2,571

 

 

$

1,737

 

 

$

834

 

 

ETFs

 

1,222

 

 

 

948

 

 

 

274

 

 

 

1,212

 

 

 

10

 

 

 

4,658

 

 

 

3,499

 

 

 

1,159

 

 

Non-ETF Index

 

190

 

 

 

159

 

 

 

31

 

 

 

207

 

 

 

(17

)

 

 

771

 

 

 

664

 

 

 

107

 

 

Equity subtotal

 

2,092

 

 

 

1,608

 

 

 

484

 

 

 

2,093

 

 

 

(1

)

 

 

8,000

 

 

 

5,900

 

 

 

2,100

 

 

Fixed income:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Active

 

560

 

 

 

514

 

 

 

46

 

 

 

561

 

 

 

(1

)

 

 

2,191

 

 

 

1,957

 

 

 

234

 

 

ETFs

 

308

 

 

 

302

 

 

 

6

 

 

 

304

 

 

 

4

 

 

 

1,201

 

 

 

1,119

 

 

 

82

 

 

Non-ETF Index

 

121

 

 

 

109

 

 

 

12

 

 

 

121

 

 

 

-

 

 

 

471

 

 

 

463

 

 

 

8

 

 

Fixed income subtotal

 

989

 

 

 

925

 

 

 

64

 

 

 

986

 

 

 

3

 

 

 

3,863

 

 

 

3,539

 

 

 

324

 

 

Multi-asset

 

373

 

 

 

311

 

 

 

62

 

 

 

369

 

 

 

4

 

 

 

1,414

 

 

 

1,163

 

 

 

251

 

 

Alternatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Illiquid alternatives

 

167

 

 

 

161

 

 

 

6

 

 

 

166

 

 

 

1

 

 

 

668

 

 

 

577

 

 

 

91

 

 

Liquid alternatives

 

169

 

 

 

141

 

 

 

28

 

 

 

163

 

 

 

6

 

 

 

629

 

 

 

502

 

 

 

127

 

 

Currency and commodities

 

53

 

 

 

50

 

 

 

3

 

 

 

55

 

 

 

(2

)

 

 

216

 

 

 

168

 

 

 

48

 

 

Alternatives subtotal

 

389

 

 

 

352

 

 

 

37

 

 

 

384

 

 

 

5

 

 

 

1,513

 

 

 

1,247

 

 

 

266

 

 

Long-term

 

3,843

 

 

 

3,196

 

 

 

647

 

 

 

3,832

 

 

 

11

 

 

 

14,790

 

 

 

11,849

 

 

 

2,941

 

 

Cash management

 

125

 

 

 

197

 

 

 

(72

)

 

 

111

 

 

 

14

 

 

 

470

 

 

 

790

 

 

 

(320

)

 

Total investment advisory, administration fees

  and securities lending revenue

 

3,968

 

 

 

3,393

 

 

 

575

 

 

 

3,943

 

 

 

25

 

 

 

15,260

 

 

 

12,639

 

 

 

2,621

 

 

Investment advisory performance fees:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity

 

83

 

 

 

62

 

 

 

21

 

 

 

8

 

 

 

75

 

 

 

153

 

 

 

91

 

 

 

62

 

 

Fixed income

 

17

 

 

 

22

 

 

 

(5

)

 

 

2

 

 

 

15

 

 

 

48

 

 

 

35

 

 

 

13

 

 

Multi-asset

 

15

 

 

 

22

 

 

 

(7

)

 

 

-

 

 

 

15

 

 

 

32

 

 

 

35

 

 

 

(3

)

 

Alternatives:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Illiquid alternatives

 

61

 

 

 

28

 

 

 

33

 

 

 

50

 

 

 

11

 

 

 

208

 

 

 

83

 

 

 

125

 

 

Liquid alternatives

 

153

 

 

 

285

 

 

 

(132

)

 

 

285

 

 

 

(132

)

 

 

702

 

 

 

860

 

 

 

(158

)

 

Alternatives subtotal

 

214

 

 

 

313

 

 

 

(99

)

 

 

335

 

 

 

(121

)

 

 

910

 

 

 

943

 

 

 

(33

)

 

Total performance fees

 

329

 

 

 

419

 

 

 

(90

)

 

 

345

 

 

 

(16

)

 

 

1,143

 

 

 

1,104

 

 

 

39

 

 

Technology services revenue

 

339

 

 

 

305

 

 

 

34

 

 

 

320

 

 

 

19

 

 

 

1,281

 

 

 

1,139

 

 

 

142

 

 

Distribution fees:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retrocessions

 

302

 

 

 

217

 

 

 

85

 

 

 

294

 

 

 

8

 

 

 

1,098

 

 

 

736

 

 

 

362

 

 

12b-1 fees (US mutual fund distribution fees)

 

95

 

 

 

83

 

 

 

12

 

 

 

91

 

 

 

4

 

 

 

358

 

 

 

337

 

 

 

21

 

 

Other

 

14

 

 

 

14

 

 

 

-

 

 

 

16

 

 

 

(2

)

 

 

65

 

 

 

58

 

 

 

7

 

 

Total distribution fees

 

411

 

 

 

314

 

 

 

97

 

 

 

401

 

 

 

10

 

 

 

1,521

 

 

 

1,131

 

 

 

390

 

 

Advisory and other revenue:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Advisory

 

31

 

 

 

20

 

 

 

11

 

 

 

13

 

 

 

18

 

 

 

68

 

 

 

68

 

 

 

-

 

 

Other

 

28

 

 

 

27

 

 

 

1

 

 

 

28

 

 

 

-

 

 

 

101

 

 

 

124

 

 

 

(23

)

 

Total advisory and other revenue

 

59

 

 

 

47

 

 

 

12

 

 

 

41

 

 

 

18

 

 

 

169

 

 

 

192

 

 

 

(23

)

 

Total revenue

$

5,106

 

 

$

4,478

 

 

$

628

 

 

$

5,050

 

 

$

56

 

 

$

19,374

 

 

$

16,205

 

 

$

3,169

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Highlights

Investment advisory, administration fees and securities lending revenue increased $575 million from the fourth quarter of 2020, primarily driven by strong organic base fee growth and the positive impact of market beta on average AUM, partially offset by the impact of yield-related fee waivers on certain money market funds and strategic pricing changes to certain products. Securities lending revenue of $136 million increased from $131 million in the fourth quarter of 2020, primarily reflecting higher average balances of securities on loan, partially offset by lower asset spreads.

Investment advisory, administration fees and securities lending revenue increased $25 million from the third quarter of 2021, primarily driven by organic growth and the positive impact of market beta on average AUM, partially offset by lower securities lending revenue and the negative impact of foreign exchange movements. Securities lending revenue of $136 million decreased from $152 million in the third quarter of 2021, primarily reflecting lower asset and liability spreads.

Performance fees decreased $90 million from the fourth quarter of 2020, primarily reflecting lower revenue from liquid alternative products, partially offset by higher revenue from illiquid alternative and long-only products.

Performance fees decreased $16 million from the third quarter of 2021, primarily due to lower revenue from liquid alternative products, reflecting strong performance from a single hedge fund with an annual performance measurement period that ends in the third quarter, partially offset by higher revenue from long-only mandates and illiquid alternative products.

Technology services revenue increased $34 million and $19 million from the fourth quarter of 2020 and the third quarter of 2021, respectively, primarily reflecting higher revenue from Aladdin. Technology services annual contract value(1) (“ACV”) increased 13% from the fourth quarter of 2020.

 

 

(1)

ACV represents the forward-looking, annualized estimated value of the recurring subscription fees under client contracts, assuming all client contracts that come up for renewal are renewed. ACV excludes nonrecurring fees such as implementation and consulting fees. See note (4) to the condensed consolidated statements of income and supplemental information on page 12 for more information on ACV.

7

 


 

 

 

SUMMARY OF OPERATING EXPENSE

 

 

Three Months

 

 

 

 

 

 

Three Months

 

 

 

 

 

 

Year

 

 

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

September 30,

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

(in millions), (unaudited)

2021

 

 

2020

 

 

Change

 

 

2021

 

 

Change

 

 

2021

 

 

2020

 

 

Change

 

 

Operating expense

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Employee compensation and benefits

$

1,559

 

 

$

1,341

 

 

$

218

 

 

$

1,527

 

 

$

32

 

 

$

6,043

 

 

$

5,041

 

 

$

1,002

 

 

Distribution and servicing costs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retrocessions

 

302

 

 

 

217

 

 

 

85

 

 

 

294

 

 

 

8

 

 

 

1,098

 

 

 

736

 

 

 

362

 

 

12b-1 costs

 

93

 

 

 

81

 

 

 

12

 

 

 

89

 

 

 

4

 

 

 

350

 

 

 

328

 

 

 

22

 

 

Other

 

192

 

 

 

207

 

 

 

(15

)

 

 

202

 

 

 

(10

)

 

 

752

 

 

 

771

 

 

 

(19

)

 

Total distribution and servicing costs

 

587

 

 

 

505

 

 

 

82

 

 

 

585

 

 

 

2

 

 

 

2,200

 

 

 

1,835

 

 

 

365

 

 

Direct fund expense

 

319

 

 

 

283

 

 

 

36

 

 

 

354

 

 

 

(35

)

 

 

1,313

 

 

 

1,063

 

 

 

250

 

 

General and administration expense:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Marketing and promotional

 

96

 

 

 

73

 

 

 

23

 

 

 

54

 

 

 

42

 

 

 

238

 

 

 

229

 

 

 

9

 

 

Occupancy and office related

 

114

 

 

 

80

 

 

 

34

 

 

 

91

 

 

 

23

 

 

 

364

 

 

 

319

 

 

 

45

 

 

Portfolio services

 

95

 

 

 

80

 

 

 

15

 

 

 

93

 

 

 

2

 

 

 

362

 

 

 

283

 

 

 

79

 

 

Technology

 

135

 

 

 

124

 

 

 

11

 

 

 

140

 

 

 

(5

)

 

 

508

 

 

 

397

 

 

 

111

 

 

Professional services

 

57

 

 

 

49

 

 

 

8

 

 

 

42

 

 

 

15

 

 

 

179

 

 

 

170

 

 

 

9

 

 

Communications

 

11

 

 

 

14

 

 

 

(3

)

 

 

11

 

 

 

-

 

 

 

44

 

 

 

54

 

 

 

(10

)

 

Foreign exchange remeasurement

 

1

 

 

 

(1

)

 

 

2

 

 

 

1

 

 

 

-

 

 

 

4

 

 

 

6

 

 

 

(2

)

 

Contingent consideration fair value adjustments

 

1

 

 

 

-

 

 

 

1

 

 

 

29

 

 

 

(28

)

 

 

34

 

 

 

23

 

 

 

11

 

 

Product launch costs

 

-

 

 

 

2

 

 

 

(2

)

 

 

96

 

 

 

(96

)

 

 

274

 

 

 

166

 

 

 

108

 

 

Charitable Contribution

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

589

 

 

 

(589

)

 

Other general and administration

 

54

 

 

 

53

 

 

 

1

 

 

 

54

 

 

 

-

 

 

 

214

 

 

 

229

 

 

 

(15

)

 

Total general and administration expense

 

564

 

 

 

474

 

 

 

90

 

 

 

611

 

 

 

(47

)

 

 

2,221

 

 

 

2,465

 

 

 

(244

)

 

Amortization of intangible assets

 

38

 

 

 

27

 

 

 

11

 

 

 

38

 

 

 

-

 

 

 

147

 

 

 

106

 

 

 

41

 

 

Total operating expense

$

3,067

 

 

$

2,630

 

 

$

437

 

 

$

3,115

 

 

$

(48

)

 

$

11,924

 

 

$

10,510

 

 

$

1,414

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Highlights

Employee compensation and benefits expense increased $218 million from the fourth quarter of 2020, primarily reflecting higher base compensation, driven by previously announced base salary increases and higher headcount, and higher deferred compensation, reflecting the impact of additional grants associated with prior-year compensation.

Employee compensation and benefits expense increased $32 million from the third quarter of 2021, primarily due to higher base compensation, driven by previously announced base salary increases.

Direct fund expense increased $36 million from the fourth quarter of 2020, primarily reflecting higher average AUM, partially offset by higher rebates that seasonally occur in the fourth quarter.

Direct fund expense decreased $35 million from the third quarter of 2021, despite higher average AUM, primarily reflecting certain rebates that seasonally occur in the fourth quarter.

General and administration expense increased $90 million from the fourth quarter of 2020 reflecting higher marketing and promotional expense, portfolio services and technology expense.  The increase also reflected higher occupancy and office related expense, including $17 million of noncash occupancy expense related to the lease of office space for the Company’s future headquarters located at 50 Hudson Yards in New York (“Lease cost – Hudson Yards”), which it expects to begin to occupy in late 2022 (and begin lease payments in May 2023).  Lease cost – Hudson Yards has been excluded from our “as adjusted” financial results. See pages 10 through 12 for the reconciliation to GAAP and notes (1) through (3) to the condensed consolidated statements of income and supplemental information for more information on as adjusted items.

General and administration expense decreased $47 million from the third quarter of 2021, primarily reflecting lower product launch costs and contingent consideration fair value adjustments, partially offset by seasonally higher marketing and promotional expense, occupancy and professional services expense.

Amortization of intangible assets expense increased $11 million from the fourth quarter of 2020, primarily reflecting amortization of intangible assets related to the Aperio Transaction.

 

 

 

 

 

 

 

 

 

 

 

8

 


 

 

 

SUMMARY OF NONOPERATING INCOME (expense), less net income (loss) attributable TO noncontrolling interests

 

 

 

 

Three Months

 

 

 

 

 

 

Three Months

 

 

 

 

 

 

Year

 

 

 

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

September 30,

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

(in millions), (unaudited)

 

2021

 

 

2020

 

 

Change

 

 

2021

 

 

Change

 

 

2021

 

 

2020

 

 

Change

 

 

Nonoperating income (expense), GAAP basis

 

$

71

 

 

$

319

 

 

$

(248

)

 

$

336

 

 

$

(265

)

 

$

723

 

 

$

829

 

 

$

(106

)

 

Less: Net income (loss) attributable to

     noncontrolling interests ("NCI")

 

 

(11

)

 

 

192

 

 

 

(203

)

 

 

72

 

 

 

(83

)

 

 

304

 

 

 

354

 

 

 

(50

)

 

Nonoperating income (expense)(1)

 

$

82

 

 

$

127

 

 

$

(45

)

 

$

264

 

 

$

(182

)

 

$

419

 

 

$

475

 

 

$

(56

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months

 

 

 

 

 

 

Three Months

 

 

 

 

 

 

Year

 

 

 

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

September 30,

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

(in millions), (unaudited)

 

2021

 

 

2020

 

 

Change

 

 

2021

 

 

Change

 

 

2021

 

 

2020

 

 

Change

 

 

Net gain (loss) on investments(1)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Private equity

 

$

66

 

 

$

36

 

 

$

30

 

 

$

124

 

 

$

(58

)

 

$

278

 

 

$

44

 

 

$

234

 

 

Real assets

 

 

10

 

 

 

(3

)

 

 

13

 

 

 

4

 

 

 

6

 

 

 

20

 

 

 

8

 

 

 

12

 

 

Other alternatives(2)

 

 

4

 

 

 

22

 

 

 

(18

)

 

 

13

 

 

 

(9

)

 

 

47

 

 

 

32

 

 

 

15

 

 

Other investments(3)

 

 

(15

)

 

 

85

 

 

 

(100

)

 

 

(8

)

 

 

(7

)

 

 

22

 

 

 

120

 

 

 

(98

)

 

Subtotal

 

 

65

 

 

 

140

 

 

 

(75

)

 

 

133

 

 

 

(68

)

 

 

367

 

 

 

204

 

 

 

163

 

 

Gain related to the Charitable Contribution

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

122

 

 

 

(122

)

 

Other gains (losses)(4)

 

 

21

 

 

 

13

 

 

 

8

 

 

 

165

 

 

 

(144

)

 

 

170

 

 

 

292

 

 

 

(122

)

 

Total net gain (loss) on investments(1)

 

 

86

 

 

 

153

 

 

 

(67

)

 

 

298

 

 

 

(212

)

 

 

537

 

 

 

618

 

 

 

(81

)

 

Interest and dividend income

 

 

46

 

 

 

28

 

 

 

18

 

 

 

14

 

 

 

32

 

 

 

87

 

 

 

62

 

 

 

25

 

 

Interest expense

 

 

(50

)

 

 

(54

)

 

 

4

 

 

 

(48

)

 

 

(2

)

 

 

(205

)

 

 

(205

)

 

 

-

 

 

Net interest expense

 

 

(4

)

 

 

(26

)

 

 

22

 

 

 

(34

)

 

 

30

 

 

 

(118

)

 

 

(143

)

 

 

25

 

 

Nonoperating income (expense)(1)

 

$

82

 

 

$

127

 

 

$

(45

)

 

$

264

 

 

$

(182

)

 

$

419

 

 

$

475

 

 

$

(56

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1)

Net of net income (loss) attributable to NCI. Management believes nonoperating income (expense), as adjusted, is an effective measure for reviewing BlackRock’s nonoperating results, which ultimately impacts BlackRock’s book value. See pages 10 through 12 for the reconciliation to GAAP and notes (1) through (3) to the condensed consolidated statements of income and supplemental information for more information on as adjusted items.

(2)

Amounts primarily include net gains (losses) related to credit funds, direct hedge fund strategies and hedge fund solutions.

(3)

Amounts primarily include net gains (losses) related to unhedged equity, fixed income and multi-asset investments.

(4)

The amount for the year ended December 31, 2021 includes nonoperating noncash pre-tax gains in connection with strategic minority investments in iCapital Network, Inc. of approximately $119 million and Scalable Capital Limited of approximately $46 million.  The amount for the year ended December 31, 2020 includes a nonoperating noncash pre-tax gain of approximately $240 million in connection with a recapitalization of iCapital Network, Inc. Additional amounts include noncash pre-tax gains (losses) related to the revaluation of certain other corporate minority investments.

 

 

INCOME TAX EXPENSE

 

 

Three Months

 

 

 

 

 

Three Months

 

 

 

 

 

 

Year

 

 

 

 

 

 

 

Ended

 

 

 

 

 

Ended

 

 

 

 

 

 

Ended

 

 

 

 

 

 

 

December 31,

 

 

 

 

 

September 30,

 

 

 

 

 

 

December 31,

 

 

 

 

 

 

(in millions), (unaudited)

2021

 

 

2020

 

 

Change

 

2021

 

 

Change

 

 

2021

 

 

2020

 

 

Change

 

 

Income tax expense

$

478

 

 

$

427

 

 

$

51

 

 

$

518

 

 

$

(40

)

 

$

1,968

 

 

$

1,238

 

 

$

730

 

 

Effective tax rate

 

22.6

%

 

 

21.6

%

 

 

100

bps

 

 

23.6

%

 

 

(100

) bps

 

 

25.0

%

 

 

20.1

%

 

 

490

bps

 

 

Highlights

 

Fourth quarter 2021 income tax expense includes a $45 million net noncash tax benefit related to the revaluation of certain deferred income tax liabilities.

 

Fourth quarter 2020 income tax expense includes $61 million of net discrete tax benefits, partially offset by a $25 million net noncash tax expense related to the revaluation of certain deferred income tax liabilities.


9

 


 

 

 

 

 

RECONCILIATION OF GAAP OPERATING INCOME AND OPERATING MARGIN TO OPERATING INCOME AND OPERATING MARGIN, AS ADJUSTED

 

 

Three Months Ended

 

 

Year Ended

 

 

 

 

December 31,

 

 

September 30,

 

 

December 31,

 

 

(in millions), (unaudited)

 

2021

 

 

2020

 

 

2021

 

 

2021

 

 

2020

 

 

Operating income, GAAP basis

 

$

2,039

 

 

$

1,848

 

 

$

1,935

 

 

$

7,450

 

 

$

5,695

 

 

Non-GAAP expense adjustment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease cost - Hudson Yards

 

 

17

 

 

 

-

 

 

 

11

 

 

 

28

 

 

 

-

 

 

Charitable Contribution

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

589

 

 

Operating income, as adjusted (1)

 

 

2,056

 

 

 

1,848

 

 

 

1,946

 

 

 

7,478

 

 

 

6,284

 

 

Product launch costs and commissions

 

 

-

 

 

 

2

 

 

 

99

 

 

 

284

 

 

 

172

 

 

Operating income used for operating margin measurement

 

$

2,056

 

 

$

1,850

 

 

$

2,045

 

 

$

7,762

 

 

$

6,456

 

 

Revenue, GAAP basis

 

$

5,106

 

 

$

4,478

 

 

$

5,050

 

 

$

19,374

 

 

$

16,205

 

 

Non-GAAP adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Distribution fees

 

 

(411

)

 

 

(314

)

 

 

(401

)

 

 

(1,521

)

 

 

(1,131

)

 

Investment advisory fees

 

 

(176

)

 

 

(191

)

 

 

(184

)

 

 

(679

)

 

 

(704

)

 

Revenue used for operating margin measurement

 

$

4,519

 

 

$

3,973

 

 

$

4,465

 

 

$

17,174

 

 

$

14,370

 

 

Operating margin, GAAP basis

 

 

39.9

%

 

 

41.3

%

 

 

38.3

%

 

 

38.5

%

 

 

35.1

%

 

Operating margin, as adjusted (1)

 

 

45.5

%

 

 

46.6

%

 

 

45.8

%

 

 

45.2

%

 

 

44.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

See note (1) to the condensed consolidated statements of income and supplemental information on page 11 for more information on as adjusted items.

 

RECONCILIATION OF GAAP NONOPERATING INCOME (EXPENSE) TO NONOPERATING INCOME (EXPENSE), LESS NET INCOME (LOSS) ATTRIBUTABLE TO NCI, AS ADJUSTED

 

 

Three Months Ended

 

 

Year Ended

 

 

 

 

December 31,

 

 

September 30,

 

 

December 31,

 

 

(in millions), (unaudited)

 

2021

 

 

2020

 

 

2021

 

 

2021

 

 

2020

 

 

Nonoperating income (expense), GAAP basis

 

$

71

 

 

$

319

 

 

$

336

 

 

$

723

 

 

$

829

 

 

Less: Net income (loss) attributable to NCI

 

 

(11

)

 

 

192

 

 

 

72

 

 

 

304

 

 

 

354

 

 

Nonoperating income (expense), net of NCI

 

 

82

 

 

 

127

 

 

 

264

 

 

 

419

 

 

 

475

 

 

Less: Gain related to the Charitable Contribution

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

122

 

 

Nonoperating income (expense), less net income (loss)

   attributable to NCI, as adjusted (2)

 

$

82

 

 

$

127

 

 

$

264

 

 

$

419

 

 

$

353

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

See note (2) to the condensed consolidated statements of income and supplemental information on page 12 for more information on as adjusted items.

 

RECONCILIATION OF GAAP NET INCOME ATTRIBUTABLE TO BLACKROCK TO NET INCOME ATTRIBUTABLE TO BLACKROCK, AS ADJUSTED

 

 

Three Months Ended

 

 

Year Ended

 

 

 

 

December 31,

 

 

September 30,

 

 

December 31,

 

 

(in millions, except per share data), (unaudited)

 

2021

 

 

2020

 

 

2021

 

 

2021

 

 

2020

 

 

Net income attributable to BlackRock, Inc., GAAP basis

 

$

1,643

 

 

$

1,548

 

 

$

1,681

 

 

$

5,901

 

 

$

4,932

 

 

Non-GAAP adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease cost - Hudson Yards, net of tax

 

 

13

 

 

 

-

 

 

 

9

 

 

 

22

 

 

 

-

 

 

Charitable Contribution, net of tax

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

226

 

 

Income tax matters

 

 

(45

)

 

 

25

 

 

 

-

 

 

 

126

 

 

 

79

 

 

Net income attributable to BlackRock, Inc., as adjusted (3)

 

$

1,611

 

 

$

1,573

 

 

$

1,690

 

 

$

6,049

 

 

$

5,237

 

 

Diluted weighted-average common shares outstanding

 

 

154.6

 

 

 

154.5

 

 

 

154.3

 

 

 

154.4

 

 

 

154.8

 

 

Diluted earnings per common share, GAAP basis

 

$

10.63

 

 

$

10.02

 

 

$

10.89

 

 

$

38.22

 

 

$

31.85

 

 

Diluted earnings per common share, as adjusted (3)

 

$

10.42

 

 

$

10.18

 

 

$

10.95

 

 

$

39.18

 

 

$

33.82

 

 

 

See note (3) to the condensed consolidated statements of income and supplemental information on page 12 for more information on as adjusted items.


10

 


 

 

 

NOTES TO CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND SUPPLEMENTAL INFORMATION (unaudited)

 

BlackRock reports its financial results in accordance with accounting principles generally accepted in the United States (“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:

(1) Operating income, as adjusted, and operating margin, as adjusted: 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.

Operating income, as adjusted, includes non-GAAP expense adjustments. In 2021, the Company recorded expense related to the lease of office space for its future headquarters located at 50 Hudson Yards in New York (“Lease cost – Hudson Yards”). While the Company expects to begin to occupy the new office space in late 2022 (and begin cash lease payments in May 2023), the Company is required to record lease expense from August 2021 because it obtained access to the building to begin its tenant improvements.  As a result, the Company is recognizing lease expense for both its current and future headquarters until its current headquarters lease expires in April 2023.  Management believes removing Lease cost – Hudson Yards when calculating operating income, as adjusted, is useful to assess the Company’s financial performance and enhances comparability among periods presented. In 2020, the Company contributed its remaining 20% stake in PennyMac Financial Services, Inc. (the “Charitable Contribution”). The Charitable Contribution expense of $589 million has been excluded from operating income, as adjusted, due to its nonrecurring nature.

Operating income used for measuring operating margin, as adjusted, is equal to operating income, as adjusted, excluding the impact of product launch costs (e.g. closed-end fund launch costs) and related commissions. Management believes the exclusion of such costs and related commissions is useful because these costs can fluctuate considerably and revenue associated with the expenditure of these costs will not fully impact BlackRock’s results until future periods.

Revenue used for calculating operating margin, as adjusted, is reduced to exclude all of the Company’s distribution fees, which are recorded as a separate line item on the condensed consolidated statements of income, as well as a portion of investment advisory fees received that is used to pay distribution and servicing costs. For certain products, based on distinct arrangements, distribution fees are collected by the Company and then passed-through to third-party client intermediaries. For other products, investment advisory fees are collected by the Company and a portion is passed-through to third-party client intermediaries. However, in both structures, the third-party client intermediary similarly owns the relationship with the retail client and is responsible for distributing the product and servicing the client. The amount of distribution and investment advisory fees fluctuates each period primarily based on a predetermined percentage of the value of AUM during the period. These fees also vary based on the type of investment product sold and the geographic location where it is sold. In addition, the Company may waive fees on certain products that could result in the reduction of payments to the third-party intermediaries.


11

 


 

 

 

(2) Nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted: 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. In 2020, the noncash, nonoperating pre-tax gain of $122 million related to the Charitable Contribution was excluded from nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, due to its nonrecurring nature.

(3) Net income attributable to BlackRock, Inc., as adjusted: 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 notes (1) and (2) above 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 Lease cost – Hudson Yards and Charitable Contribution.

In 2020 a discrete tax benefit of $241 million was recognized in connection with the Charitable Contribution. The discrete tax benefit has been excluded from as adjusted results due to the nonrecurring 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) ACV: Management believes ACV is an effective metric for reviewing BlackRock’s technology services’ ongoing contribution to its operating results and provides comparability of this information among reporting periods while also providing a useful supplemental metric for both management and investors of BlackRock’s growth in technology services revenue over time, as it is linked to the net new business in technology services.


12

 


 

 

 

FORWARD-LOOKING STATEMENTS

 

This earnings release, 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 earnings release, 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 continued 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; (14) changes in law and policy and uncertainty pending any such changes; (15) any failure to effectively manage conflicts of interest; (16) damage to BlackRock’s reputation; (17) terrorist activities, civil unrest, international hostilities and natural disasters, which may adversely affect the general economy, domestic and local financial and capital markets, specific industries or BlackRock; (18) the ability to attract and retain highly talented professionals; (19) fluctuations in the carrying value of BlackRock’s economic investments; (20) 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; (21) BlackRock’s success in negotiating distribution arrangements and maintaining distribution channels for its products; (22) the failure by a key vendor of BlackRock to fulfill its obligations to the Company; (23) operational, technological and regulatory risks associated with BlackRock’s major technology partnerships; (24) any disruption to the operations of third parties whose functions are integral to BlackRock’s exchange-traded funds platform; (25) 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 (26) the impact of problems at other financial institutions or the failure or negative performance of products at other financial institutions.

BlackRock’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and BlackRock’s subsequent filings with the SEC, accessible on the SEC’s website at www.sec.gov and on BlackRock’s website at www.blackrock.com, discuss these factors in more detail and identify additional factors that can affect forward-looking statements. The information contained on the Company’s website is not a part of this earnings release.

PERFORMANCE NOTES

 

Past performance is not indicative of future results. Except as specified, the performance information shown is as of December 31, 2021 and is based on preliminary data available at that time. The performance data shown reflects information for all actively and passively managed equity and fixed income accounts, including US registered investment companies, European-domiciled retail funds and separate accounts for which performance data is available, including performance data for high net worth accounts available as of November 30, 2021. The performance data does not include accounts terminated prior to December 31, 2021 and accounts for which data has not yet been verified. If such accounts had been included, the performance data provided may have substantially differed from that shown.

Performance comparisons shown are gross-of-fees for institutional and high net worth separate accounts, and net-of-fees for retail funds. The performance tracking shown for index accounts is based on gross-of-fees performance and includes all institutional accounts and all iShares funds globally using an index strategy. AUM information is based on AUM available as of December 31, 2021 for each account or fund in the asset class shown without adjustment for overlapping management of the same account or fund. Fund performance reflects the reinvestment of dividends and distributions.

Performance shown is derived from applicable benchmarks or peer median information, as selected by BlackRock, Inc. Peer medians are based in part on data either from Lipper, Inc. or Morningstar, Inc. for each included product.

13