KKR Q1 Profit Rises Sharply on Strong Fee Growth

KKR Q1 Profit Rises Sharply on Strong Fee Growth

Reuters | May 1, 2025 | 05:01 PM IST | Business | Follow on Google News

KKR Q1 Profit Rises Sharply on Strong Fee Growth Image/Yahoo Finance

KKR (KKR.N reported a nearly 20% jump in first-quarter profit on Thursday, buoyed by higher management and transaction fees it earned from its portfolio.

The results reflect the structural advantage held by large alternative asset managers, which can generate hundreds of millions in management fees even when asset sales are muted.

But market uncertainty driven by President Donald Trump’s tariffs has raised concerns among executives about a possible slowdown in mergers and acquisitions.

While a slowdown in dealmaking may limit exit opportunities, investment firms are often able to secure valuable assets at a discounted price during these times.

“Volatility can yield attractive investment opportunities, and we’re encouraged by our positioning given our global footprint,” co-CEOs Joseph Bae and Scott Nuttall said, adding that KKR has $116 billion available for deployment.

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The global investment giant’s adjusted net income was $1.03 billion, or $1.15 per share, for the three months ended March 31, compared with $863.7 million, or 97 cents per share, a year ago.

Fee-related earnings grew 23% to $822.6 million. These fees serve as a key source of stability during times of heightened market turbulence, such as the current stretch driven by anxiety over Trump’s tariffs.

Assets under management rose 15% to $664 billion, helped by $31 billion of new capital raised.

The company is also focusing on retail investors. Earlier this week, KKR and Capital Group launched two funds with low fees and minimum investment thresholds, to allow retail investors to get exposure from a blend of public and private credit.

The results come weeks after KKR’s peer Blackstone (BX.N) reported higher-than-expected profit for the first quarter, driven by strength in its private equity and credit businesses.

KKR shares have fallen 23% this year, compared with a 5% drop in the S&P 500 index (.SPX). Rivals Blackstone, Apollo Global (APO.N) and Carlyle (CG.O), have dropped 23.6%, 17.4% and 23.5%, respectively.

(Except for the headline, this story has not been edited by VoM News staff and is published from the syndicated feed)

Reuters