BLK Blackrock

Christ Meade General Counsel
Gary Shedlin Chief Financial Officer
Larry Fink Chairman and Chief Executive Officer
Rob Kapito President
Dan Fannon Jefferies
Robert Lee KBW
Ken Worthington JPMorgan
Patrick Davitt Autonomous Research
Alex Blostein Goldman Sachs
Brian Bedell Deutsche Bank
Call transcript
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Good morning, my name is Laurie, and I will be your conference facilitator today. At this time, I would like to welcome everyone to the BlackRock Incorporated Fourth Quarter and Full Year 2019 Earnings Teleconference.

Our host for today's call will be Chairman and Chief Executive Officer, Laurence D. Fink; Chief Financial Officer, Gary S. Shedlin; President, Robert S. Christopher Counsel, General and J. Kapito Meade. been All any mute prevent on noise. lines have background to placed After there speaker's the remarks, question-and-answer period. will be a Instructions] [Operator

Thank may you, you conference. Mr. begin your Meade,

Chris Meade

BlackRock. Chris General Good Meade, everyone. I'm Counsel morning, of the

the statements. Before we begin, We number this may like BlackRock's to call a course your we make from forward-looking the of course fact actual that may that remind call, of of you I'd during these statements. attention differ to results

with reports results the which you differ know, and filed As undertake update that today. the has of does some cause materially see to factors duty any of SEC, the assumes we BlackRock lists to no forward-looking BlackRock not from statements. may what BlackRock

So with that, I'll turn it Gary. over to

Gary Shedlin

morning my Happy everyone. the and results for to Year pleasure quarter present Good and year It’s fourth New Thanks, full XXXX. to Chris.

to it review turn to our over performance I and financial will Before his results. business Larry comments, I offer

I financial discloses release both earnings and results. adjusted our Our focusing as GAAP adjusted primarily as on results, will and be

different to continued years, management For growth of risk and environments, business, for clients difficult management technology globally deliver proven playing at noted year, shareholders offense. asset but BlackRock a that challenging ability integrated long our for and A in as differentiated continue tools, quarter XXXX opportunities start as and fourth we to we environments market portfolio year including a created to its in construction and disciplined remain XXXX. create the ago as BlackRock’s has market many volatile

fixed fundamental for or above excellent products assets equity XX% performance and and across achieved and systematic the period. XXXX. benchmark active income, during active taxable XX%, XX%, revenue Investment X-year median both BlackRock in with trailing peer was earnings growth respectively our

billion, in last $XXX for us in organic And organic growth, billion in seven quarter. fifth $XXX time fourth we finished beat flows X% We growth once organic with X% fee the strong to the of aspirational total growth over representing asset target reporting enabling base the year and net again inflows generated record our the years. momentum

our The segments factors, ETF and and market as financial iShares, to cycles illiquid megatrends. growth comprehensive highest alternatives whole investments simply stability of growth sustainable but offer client allows strategic strength in BlackRock These clients such us by to and to income demand continuously operating fixed long-term shareholders. especially growth invest and model and generate of technology, areas products capture solutions higher for portfolio consistent position through not

$XX.X per income of increased X%, of $XX.XX marginally. operating X% was versus billion billion up Full was while XXXX. year $X.X Earnings revenue share of up

volatility. fourth market revenue billion the quarter, BlackRock significant of XX% results and $X.X XX% were respectively when operating impacted billion, $X by from of a For up ago, year generated income and

stake versus also mark-to-market Quarterly quarter and earnings share per rate, the the marks unhedged seed Envestnet income, by investment up on was capital driven the share XX% net $XX count for higher minority reflecting of diluted and reduced non-operating lower of primarily in XXXX, current income, a $X.XX Non-operating valuation results of tax our quarter. investments. million reflected in effective higher

We as tax tax linked XXXX. items is enacted as-adjusted benefits recently on for to discrete additional quarter additional guidance and reasonable for a tax part discrete in or XX% was of of actual rate issuance The differ run tax tax projected effective by U.S. non-recurring consequence rate legislation. may on Our approximately a XX%, the driven rate reform. guidance estimate fourth currently that

offset and the securities of growth XX%, growth, ongoing XXXX. strategic revenue preference Fourth client $X.X of market lower lending quarter to AUM for $XXX in growth Year-over-year cash income billion assets up equity due however, were beta and average fee partially by of of fixed risk divergent XX% base of lagged organic and positive base impact primarily quarterly of million year-over-year driven the pricing impact fees certain by higher investments. beta,

addition, X.X year fourth of quarter. fees notwithstanding In base points while our third significant last sequentially, declined basis decline year’s a rate quarter X% Full base equity quarter. the ended versus up fees X% the in market overall fee were impact global fourth up

As a rate entered annualized lower an approximately reminder, than XXXX base X% we with fee run XXXX.

performance products fees from a versus performance strong entering liquid than a generation Fourth and doubled despite Full quarter $XXX more their illiquid were alpha year below to products. XXXX, up million the significant ago watermarks. of high X% liquid of year collecting alternative $XXX fees year of alternative compared million number

represented from significantly year. were fees performance performance total of recognized illiquid approximately up fees alternatives and Importantly, XX% the in XXXX for

and year Quarterly the full continued XX%, year-over-year of revenue reflecting technology in and increased increased million Aladdin. eFront $XXX impact acquisition revenue of XX% growth the services

for Excluding eFront, low target grew to growth continue to forward. technology and services we full revenue XX% the year going mid-teens

distribution strong of Aladdin, technology Aladdin Wealth. tools remains including our range eFront, institutional digital Demand for and solutions and full

compensation advisory quarter assignments. year-over-year increased primarily revenue and and other and advisory higher XX% by transition expense expense G&A acquisition driven the Fourth XXXX, and higher eFront. reflecting management Total in X% increased of

$XXX the deferred X% higher and primarily increased fees, compensation higher headcount, year, million expense. full higher reflecting or compensation performance For expense

of higher impact impact Our full the XXXX in of XX.X% a deferred XXXX related ratio mark-to-market acquisition year to programs full as awards than year moderately retention comp-to-revenue certain of recent the compensation activity. of and was result

aggregate million compensation remeasurement. up fourth fair consideration impact quarter on higher levels we year to contingent expense compensation that Recall and quarterly spend, of higher Fourth to related adjustments full foreign quarter seasonally and year-over-year exchange basis. $XX value because and million sequentially promotional marketing was of determine expense expense, technology of the expense a comparisons less due G&A $XXX are relevant of

spend, million II. X% of BlackRock eFront close expense Technology billion increased second reflecting higher G&A the Overall, successful $XX the of related quarter in of launch levels the and of technology XXXX, acquisition, fund and costs the to Science $X.X Trust impact

remeasurement non-core that estimate year as XXXX. versus our items X% such costs, product various contingent and expense, consideration and we adjustments, eFront full spend value of increased core impact the fair Excluding FX G&A launch

expect While to by we market discretionary and increase technology investment continually core managing comparable impact including of acquisition. would full expense continued eFront we in driven the relative XXXX currently G&A our sustainability base, levels to XXXX data initiatives the year X% focus on entire approximately and expense

full by continue year quarter overall the Our environment of challenging strategic XXXX XXXX as market adjusted despite to points responsibly basis margin volatility. year's versus was reflecting decision in capture more fourth down revenue created last XX operating XX.X% our investing

long-term our in way the to this portfolio deeply for our remain sheet possible. balance we construction see are optimizing most in We technology continue and prudently future achieve success. ETFs, committed to and And alternatives, growth drivers position efficient BlackRock to differentiated and investing strong responsibly the including performance growth best of using to

we the $X XXXX, co-investment of first million seed time. now billion allocated our growth During portfolio and to capital $XXX investment for new with exceeding over support our

to the remain an strategic share single acquisition cash eFront we risk repurchases to closed asset combination with combination the in to to XXXX. Aladdin dividends with also $X.X And of a platform. committed returning shareholders classes billion manage clients shareholders and We on portfolios of to across in systematically private aggregate and will provide ability excess through and public returning which seamlessly an

inception valuation we unlevered an $X.X shares shareholders. repurchased our attractive have the of share total billion opportunities X% $X.X in an XX% and strategy now management year. capital approximately our BlackRock XXXX, annual return billion shares outstanding of reducing by stock generating compound for price arose Since our per worth taking of during advantage $XXX of average that share at of We current approximately relative repurchased of

relative on valuation present guidance of shares At year plans we ago. the based to our would our for including of price, with stock a subject year during consistent at anticipate $X.X repurchasing conditions capital and the XXXX least spending market our billion

also conditions, later to our for XXXX see Board dividend. we quarter In an subject increase and market addition to first this month to expect approval

construction with industry to diversified enables evolving partner risk us BlackRock's entire leading to the technology order portfolio globally needs. in combined their investment with to management together firm clients bring meet and platform

all flows total including $XXX net into representing base quarter billion organic and fee and fixed growth significant and $XXX areas of approximately by active which accounted growth. for asset were client across focus and flows in cash strategic organic XX% of and Full reflected annualized indexed, iShares year and regions alternatives. X% inflows growth of organic classes, annualized billion income illiquid strength Fourth XX% led positive types AUM

inflows of Globalize the representing organic net growth. $XXX for billion generated year shares XX%

rate we of XXXX, into strategic billion XX%. momentum flows year a growth Fourth organic in in of annualized were Importantly, XX% saw inflows ETFs. equity saw by end resurgence Notably net quarter of driven segments asset driven product organic which growth. an iShares XX% over represented by $XX iShares

and May by volatility continued strength August. organic in growth XX% ETFs the saw from core primarily also segment precision outflows in exposure driven offset We with partially

Within the for strategic iShares generated where XX% income ETFs is market leader. fixed it organic the into representing fixed higher inflows ETFs a fee was billion growth. $XXX year segment, income We iShares of net record

exceptionally bond share the flows across achieved the wealth factor remains ETF access, market. investors billion number seek We diverse accelerates electronification evolves a of of and more as iShares. factor of range Demand in portfolio management market construction modernization efficient the strong with and the one technology industry $XX

USMV growing aggregate net billion the of of or time than $XX of strategic of sustainable Min fourth factor market index During gathering capturing ETF outpaced net terms is iShares $XX ETF our more highest AUM and weighted fastest our other segments billion ETF lineup every the inflows. generating the asset active billion or firm. first inflows represents the U.S. was ending XXXX, This and largest a in year Vol with $XX flows. exposure industry's in cap iShares over any

of ETF the liquid years. World led products During by Fund over Inflows $XX Multi-asset our suite year inflows XXXX, products. largest fund in outflows from net past raised the the retail billion of billion active income full active offset generate fixed Allocation and mutual equity industry. were iShares outperforming BlackRock XX representing by ESG partially alternatives $X broader Leaders the launch

billion Fourth reflected seasonal quarter $X impact of included similar reinvestment. gains retail the capital net trends, but of inflows also

reflects billion X% record income, and multi-asset billion strong. Institutional liquid Active generated Institutional primarily inflows XXXX were of BlackRock's base alternatives inflows in in for net into of performance long-term fixed net quantitative organic franchise solutions. remained growth. fee $X long-term representing $XXX strategies flows strength

alternatives of XXXX. billion illiquid inflows we and Momentum saw accelerated $XX in franchise net our in

of of alternative in variety significant representing deploy also $XX capital growth strategies a institutional of fees. source We have future and clients billion performance to committed a for

scale delivering cash innovative increase management risk platforms share and Finally, BlackRock clients and continue solutions. distribution by to management leveraging digital for

saw we In inflows cash across XXXX, management billion $XX prime, funds. including muni net platform government and sustainable, of the

innovative earlier this see strong billion of Fund or Aware since $X Environmentally inflows year. Liquid net continues with momentum Our LEAF launch to

markets. In summary, and market of us differentiated drive to invest of our in allows our XXXX which consistent platform resilience and results demonstrate a growth through the cycles variety

working. is strategy Our

to key during and in continue clients iShares, long-term alternatives deliver professional best to and returns responsibly will XXXX solutions invest areas We technology employees generate to position our for including our the growth like our shareholders. growth need to for

I'll that, over Larry. it turn With to

Larry Fink

Thank Good New everyone you, Gary. Happy to Year and a welcome morning decade. new and

changing BlackRock and clients systematically portfolio a future thought in has and platform needs the and on invested and in meet and by factors preparation technology environment providing building consistently geopolitical leadership like the sustainable to investing. for investment innovating macro areas whole

investments adapting results We partnerships are in The our driving our and strategic our building in morning. to this clients deeper are than are more ever with and industry before. more change benefits evident

trillion billion index, billion generated the fee cash $XXX and growth. $XXX generated generated diversified net trillion in we strategies. asset billion strategies, strategies now investing total cash of year record organic of inflows net $X BlackRock's $XX of iShares in $XXX index representing inflows growth base which reflects billion X% and We in strategies. and for the in $XXX X% over and and in our active flows platform active result $X is in iShares We generated across a now organic in we strength billion

entrusted than the Flows all XX than of across including in to channels year assets under that the was at by XX total were classes in the products. lower regions us global of than decline, positive base to across with fees. countries all and more net level fourth management a different XX X% of rate began new point. year equates run $X clients asset inflows across which we more past our base in and each market manager. client assets The billion a We all asset net AUM billion, challenging last After $XXX XXXX starting about XXXX fee lowered year a dramatic entered quarter XXXX top a in BlackRock's

continuing growth successful we are invest to income opportunities. execution growth, However, of strategy the in delivered future our XXXX revenue growth, operating and alongside earnings

geopolitical negotiations, trade sentiment, about and and heightened all throughout growth and by other into cash year. tensions global financial and driving XXXX slowdown a cash impacted uncertainty around which strategies, Brexit in trade was flows markets, U.S. in concerns marked safer income created volatility China industry the the assets fixed investor

central In U.K. And saw a turn equity dovish cycle of elections preliminary much followed proved with record Brexit. be so will that XXXX China. again geopolitical banks a late by trade globally, policy a to offsetting today the U.S. the by powerful risk. on decisive close and in agreement now markets monetary forward by at We we have move tool signed highs

and management finished The $X XXX of emerging believe the industries. year are transformations crossed trillion milestones wealth and marked the yet early industry rose the markets of in ETF still and growth. year iShares XX% XX%. S&P crossed industry in stages the trillion. XXXX and We assets the up The $X iShares asset for only also

in clients new public banks are and markets as market vehicles managers. use to access management, hedging returns That's iShares as of Increasingly, many as and are markets. instrument access large but liquidity instruments, tactically creating ways opportunities. an also and significant iShares helping including active for using clients However, for we market for central Alpha

Sustainability focused on on point and more reached their with social clients an inflection the factors more and governance on portfolios. environmental, impact

their align sustainability because and values investments to with climate financial implications returns Some risk related of their change. and the better of and to more

climate investors to era change entering CEOs, finance, prepared. to need risk discussed we out of drive companies investment and by to reallocation governments, in capital all came a more set letter I presented and new significant yesterday, As are my the which we're a of be

We a than partnership drive change clients to more our Throughout to model. the before. and comprehensive adapted year invest deeper, BlackRock more differentiated a business continue in and and ultimately further industry our ever with enabled

clear. alternatives, record and net iShares, in at XXXX where AUM We our services high. $XXX billion are flows. the flows time generated revenues strategies active muted and of of strong and and growth technology benefits saw investments are strategic flows all The areas record an in in active illiquid commitments faced industry is in BlackRock inflows

market environmentally aware a areas is the in progress and investing we and inflows we $X iShares including size inflows significant record regions ETFs billion the year billion than net XX And for flows less after sustainable more the in as generated the franchise China. in Our record ETF like growth $XXX made fund iShares around most $X to and world nearing year, liquid income leader factor-based industry and of launch. than each generated lead our OCIO, flows in of billion saw Europe. saw recently net and fixed we

ETF, high in one captured such industry in again in Also XXXX flows ETFs. globally. fixed Europe and the once the number We share sustainability market United States, in ETFs growth and of segments income as factor

than use expanding these its range growth double-digit to more want drivers a and decade. continued of income Fixed growth up fixed clients is about income be markets iShares iShares one of see ETFs the exposures, optimistic the modernizing will in are over as this financial largest in markets, in vast BlackRock's opening because we how next true force nowhere new We is ETFs.

combination The BlackRock's a manager. history as bond of

iShares Our a fixed differentiation $XXX data first XXXX, fixed $XX iShares. record record in of capabilities expertise surpassed billion previous of technology significant in billion compared having income in for After the and of to income net and our ETF and billion. has XXXX industry ETFs pioneered AUM generated the XXXX, inflows leading created $XXX

fixed technology result this shift. as strong this a we of see income We a overall, secular a this see some has in markets as shift. been of a While as year

institutions, reach alpha to and years next trillion from itself fixed conversations to within expect in ETFs. central path is income bond modernization trillion five the bond in the into the of $XXX from income Growth differentiated other the a of securities market fixed iShares banks and We growth and equities. coming even $X going be than managers ETFs from

used We active billion all significantly allocation. of asset risk as ever return source factor in to than index providers. active ETF $XX potential have strategic generated factor outpacing into before additional factor investors other flows all iShares in factors take XXXX, beyond and More tapping an other

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we more price Europe focusing industry transparency variety the next in to MIFID could change ETF business II instance, believe trillion double For the is over $XX and years drive which driving the as models for as a accelerated. industry for adoption of $X is five across AUM of value money we of crossed generating ETFs. inflows on In clients and ETF iShares are $X this record billion will demand trillion region

United platforms more costs, to eliminating reach see independent people the shift we and invest ETFs long-term to objectives. enabling access transaction their democratization financial to direct in States, through and financial And to advisory investing strategies

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the across seen platforms in While, move commission to flows free October. our I've accelerated since monthly these trading

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needs illiquid allocation clients a illiquid alternative fund as had by in increasing also vintages accelerating they portfolio and term to momentum and are view their taking increased on We reassess in assets longer business more fundraising associated liabilities is their evidenced a with and their year liquidity the them, alternatives. record our and

we and billion LTPC up close $X further was XXXX estate, of which billion enhance our illiquid well of flows an in included Growth illiquid our and net infrastructure by to we net just third of quarter eFront illiquid in real as business credit. as additional second $X.X to better business in will of and close as and Fourth Growth alternative clients. acquisition integration commitments. power enhance inflows our the renewable $XX alternatives in private supported by $X provide third of a by in our generated by results LTPC billion of driven solution secured our we XXXX. from billion global alternative technology XXXX and leverage BlackRock fund $X billion

more technology today a a to with for been strategic more are we Any growth Technology our into key differentiator remains we've a business area, able how deeper, us clients. scale conversation enables our global, organization multi-asset it BlackRock. of more and to and resilient is have

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McKinsey Technology that of revenues in billion than of only $X and year-over-year milestone. shows revenues Research reach increased services XXXX. I'm doubled and BlackRock that XX% cross that soon billion $XXX will since X% technology more startups proud

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The benefits of BlackRock's investments are evident in our consistent growth.

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With for up that, open questions. let's it


Thank Instructions] comes Fannon first Your you. [Operator of Dan of from Jefferies. line the question

Dan Fannon

Thank morning. Good you.

Larry Fink

Good morning, Dan.

Dan Fannon

about clients doing, are the year, growth, second seen inflows, how the XXXX, outlook for the kind for side you the half your positioned? just income? of year, what we've of the about Can client modest you on In outflows. about you're big at start think in level base, saw I outlook set of you you rerisking As active and kind now you can talk and within your think XXXX, talked fixed of the

Larry Fink

think of or change biggest probably fixed I ETFs active go down interest beyond be for income, strategies. Well, fixed and macro rates for to is the the up going utilization if

Rob navigate; and a remarks a we use in be importantly talk use believe active be and to my bonds. is to mentioned to of cheaper in for easier of said I navigate; with and flexibility fundamental an in income returns. it's going exposure, this it's little be you fixed versus going income more, I'll trend how landscape as an as it provide when using believe the is I to As operational vehicle you much the thousands substantially overwhelming they're ETFs to let Gary as fixed that about myriad prepared less and this people shift going risk ETFs greater

The very or outflows of one in – with the fixed income clients. idiosyncratic were two specifics

We are so to strategies, hard as dialogues strategy active said, Rob, seeing about how we use do two into things portfolio add you what differentiate ETF broader, it's we some replace those I want build the to define that? more clients, as ETFs more a deeper, as to an setting. and in to

Rob Kapito

been of No. which than now in the lower have to that has returns, fixed to rates extend out of those flows and fixed is in we been anymore at general, that position cash been now clients more getting seeing are trend think on common expect sideline a willing into cannot has can there belief BlackRock's into than add, longer, beneficiary I sitting would income, use going they because money just continue into, I the a that are be cash, afford are to and the with XXXX. go for more less and come the amount the individual we flows, than X% of we of so rather those portfolio in diversified into and bonds, and particular that the that have beneficiary will are income, been ETFs they

Larry Fink

whole year can't putting because a versus respond me another. one just perspective quarter add, I Let to

full income. For we billion inflows active the in fixed of had year, $XX

of and when in other and more and we in it then you in LDI year, billion types other For had strategies. the all put ETFs, index $XXX and we perspective full even had obviously so types of

year having to a how propositions in strong of we business use had fixed very their provide and can income the a So strategy. one fixed clients about holistic in income, we conversation one is ETFs our

but active ever are decipher, mix And with more of income we having the kind relationships clients ETF to for in than fixed you broader, deeper so, is harder before.


Your the of next KBW. from question comes line Robert of Lee

Robert Lee

the months, morning. but that, how know may us want back Aladdin, other and -- incorporated, need, full to add only execution it of kind everyone. kind want I you kind start that to and feel been you seven you maybe of And maybe of do to more think sense language of it's to the extent to now build eFront, that set can you or of maybe just I then capabilities need be mean Good going out a give Year, platform to? New of like within to eight monetize you Great. or to you've broadly on there be Happy are it's like really the kind just I you the have of aspects just portfolios, months you and

Gary Shedlin

I are we stages Aladdin and system everything more about going that well of Risk anticipated is premier think effectively Analytics designed Rob, the primarily Analytics fit true. thought remember, was through Portfolio as with and Aladdin to the eFront strategic Again suggesting come to So, that began liquid. early ultimately

the of And will a we that As reality of eFront about we eFront. we've spent know, you to years attempting for doing by thinking time accelerate as side about on a us. for doing liquid is build number done the bunch what illiquid thought

on to on been a bringing expertise the been getting about entire same have for engaged side. in us together doing basically the their very that single clients with portfolio technology years liquid platform for and allows think them them I we've thinking terms bring of

view that they So, analytics complete perspective. their have of portfolio risk and whole entire from illiquid a to a get the

low our together over next will business. mid-teens actually combined will, We we that that expectation months, of long-term of in is the months opportunities to joint as a technology this to a with the XX it had basically earlier our for and globally. won live pipeline year, continue the we to this our growing first which client, reinforce announced strong We've six bring and growth number

Larry Fink

did I factor we're clients and becoming real of why we sure portfolios BlackRock can language factors risk our is forward. that the system. adding and to sustainability our sustainability going would investment at Aladdin of This we the and more sleeves just key in at is more we onto add, sleeves the believe investors committed one making to to that. Aladdin as What look our and have add to

same that them. the more as our needs. in the elevated as providing clients and then one we are with more has now to been designed doing that we so of content But the Aladdin content fee then of grow components proposition, drive grow of we Aladdin clients we the continue Aladdin growing of we've same for structure. think as grow, on believe Aladdin. the with been is the with assets their value and onto I characteristics And with key we've more clients' happens what of putting so the is And while how key they're

for us is to in so key additive. continue to And to to be stay characteristic innovate more front the

making with investors know And our and our entire and now we need And all we've our -- I'm I now not looking to it's the we for be helping believe with our operate for business. now is eFront been acquisition. the business, able additive, to to very sleeves more back don't illiquids -- have having them were we only years those to. about how is Al's for without have even talking the it additive Aladdin technology why this spending


line Worthington from of of JPMorgan. question next Ken Your comes the

Larry Fink

morning, Ken. Good

Ken Worthington

you Thank for morning. that. taking my on question. good To Hi, up follow

focus So your the change. annual letter, on climate

there or sustainability sustainability did than a risk to profit Aladdin? sustainable So be solutions. technology can strategy In you the you're Aladdin developing to another or element new either are words, by opportunities in are management, BlackRock expertise of just with ESG other rather leverage planning for you as selling in Aladdin

Rob Kapito

the we in platform using we BlackRock opportunities have last other up add value our Aladdin So Larry's into following to proposition. profit centers that on answer, see for huge and sustainability certainly for

could already that pinpoint be generated would working creating products the specific are and in appropriate in net many distribution of sustainable of year. ETFs take inflows in an $XX and would screen for of model like for or growing ESG, to were total people models and indices the of new portfolios that future billion specific specific billion to the someone sustainability it's the and coming the areas for that fastest our interested $X would for be indices ESG, screens it see fourth others to in forward XXXX offer as networks category in and new quarter ETFs iShares creating the in lead want I looking Potentially creating new market use. what So to creating

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Larry Fink

to just Let that. me add

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next line from Research. comes of Your Davitt question Patrick the of Autonomous

Larry Fink

Patrick. morning, Good

Patrick Davitt

morning, Good guys.

to XXXX you On sounds the kind be of walk X% to everything specifically? be that backing out kind guide, get for through adjustments we growth a of G&A it should could growth, the making like lot base to there's of X% we should

Gary Shedlin

be we've I I our mean, Patrick. Sure, think definition transparent we've on pretty been, tried of non-core. to

if So in is margin foreign just for price quarter; of, it a I XXX call alone. We that up million. there, $XX would fourth value little quarter some about well perspective, the purchase look was adjustments the remeasurement. case, at fourth quarter I mean was about but non-core, the in of exchange was million in probably points That basis about contingent seasonality as the you what as again, there $XXX about million fourth talked $XX of

launch of of it go If acquired price value better. already $XXX adjusted what is I margin, call where also $XX million these actually adjustments, that the we've you included look contingent up, we are non-core payments included which at businesses we million plus that's means the a little those have but over purchase of would it that fair $XX about that had full as out million cost, year, for fund doing

So that's a good thing.

million just doing of related there knock FX things about fees probably that for $XX and there's to were $XX year. We deal during had million the in we remeasurement, of million to $XX

that's So of non-core. would is numbers kind basically of kind we a that the think

while XXXX. think we to eFront eight of have so we're from have remember, also months trying at relative to just look in because of general And XX lift we about that the year bit up months the had we we that And a X%, apples-to-apples. little


of comes Your the from line of Goldman question Blostein next Alex Sachs.

Larry Fink

Alex. morning, Good

Alex Blostein

Hey, everybody. good morning

I Gary, block product to bit end I So and reinvestments a little product of about the moves? target kind that enabled could AUM last I little to wanted little ETF bit to on pricing to capture strategic your at you do in expand discussion the potential the here price done guess as in help more sensitive guess categories I how we Could you've turn past. think some guys of year is bit could a or categories of in you which a you tech of kind talked think that distribution

Gary Shedlin

So conference end Alex, the of your it's excellent really year. at no we offered different than messaging the the at

growth, in business. to driven is, we'll criteria the pricing see sensitive frankly, that, when need things, investments. but consider pricing our if high see see we where clients of two basically the price I think strategic segments to said we are And of need basically of we of and meet we make we we those terms combination in I obviously, to react number those have various really need We future our we will a in reality of particular decisions. making part, But growth will to basically iShares most investments pricing most for the as towards business. our are think

Since investments iShares back respect that the grown clients we we've that that of in invested also only a time of for honestly about revenue not look virtue revenue annually NPV our positive X.X% been but good, of delivered. And as to period pricing shareholders have for that we've by substantially X.X% XX%. XXXX, roughly approximately and iShares think very has that over by

move tend leadership those expect iShares our be level but of would we that of XXXX streams. sticky the and XXXX of an revenue that to to obviously our franchise. more investments normalized that element within pricing In during pricing We long-term were maintaining range, would a investments I and important end at know lower that's assets

and or way efficient investment no possible. to most pricing strategic we company in than organic into take that think budget tend think investments the growth optimizing we other about we any And about in and them different making we them consideration sure as are our growing

related target mentioned earlier moment, the in most growth on the precision and I their as will decision income key the liquidity going fixed most of focused that any importantly the our think decision Rob at a in segments of simply and strategic as more on fee that we There likely be the question pricing don't of well as of where investments pricing price in importantly the will buying core those forward. are higher a and of the be today elements think client not the that are of of those focus certain but is categories, seeing in we core instruments the no areas,


of line Your final Bedell the of from Brian Bank. Deutsche question comes

Brian Bedell

to Great. Thanks in much. income more much. fixed time iShares. just hone the Thanks very good Hey, Maybe on morning. very

$X about So far we're billion seeing in little billion quarter-to-date or institutional. $X about income January-to-date fixed -- about of billion flows and $X core about iShares

driver of substituting that which spreads more, targeting institutional allocations that to So ETFs is specific are our bid-ask do forward. you for the trend, you in that managers a you're element latter about the going powerful bonds talk tighter from see seeing continuing, it being more because more just the and be seeing institutional seems ETF growth or it



both. it's So,

is lot our size reallocation forte of is scale capture and into think a institutional So because to of flows fixed our I income done our those there and iShares.

to their And income have its build you people view of the difficult in and be is as income fixed and diversified portfolio time then expensive. of find So quick, in. one way, allocations less to fixed get bonds as supply done takes equity know the the a in the their liquid that value quite is friction are it being is and value to portfolio. a more can way diversified is This convenient, quite very

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is So of most year. at went when the strategy. seen we the those time now talk the their down institutions as market and beginning that and this the of down continue that year sit We've end the saw flows the about into

very these So well I attract think flows. to we're positioned institutional large


Ladies Fink, you do and for time have any Mr. remarks? gentlemen, closing we have reached the questions. allotted

Larry Fink

Thank you Operator. everyone continued you, Thank joining Yes. for morning, BlackRock. our interest and your at

the I have And proud industry will the invest. to to lead progress made we we throughout of I am XXXX. continue can promise

the innovate to continue come. years in will We to

better we of to will shareholders. experience we more clients' and well-being, needs. that fulfill as continue So we and to our growth. helping you, positioned do if And be our And could organization better we in to our more an be will what more financial people and better meet through purpose we generate

New decade. a next the Thank start the Have and of enjoy Year you. great


you. concludes teleconference. today's Thank This

may You disconnect. now