BlackRock Assets Hit Record $11.5 Trillion as Wells Fargo Beats Q3 Profit Estimates

Wall Street's third-quarter earnings season opened on a buoyant note as BlackRock reported that its assets under management (AUM) climbed to an unprecedented $11.48 trillion, up $2.4 trillion from a year earlier. The world's largest money manager benefited from a powerful combination of rallying global equity and bond markets alongside record quarterly net inflows of $221 billion, pushing total client inflows for the first nine months of the year to $360 billion.

BlackRock's third-quarter revenue jumped 15% year-over-year to $5.20 billion, while adjusted net income rose 5% to $1.72 billion, or $11.46 per diluted share, easily outpacing analyst estimates of $10.38 per share. Exchange-traded funds (ETFs) attracted $97 billion in net new money during the quarter, while fixed-income strategies pulled in $63 billion as institutional and retail investors locked in yields ahead of central bank rate cuts.

Record $221 Billion Inflows Propel BlackRock Across Public and Private Markets

Chairman and Chief Executive Officer Larry Fink highlighted the firm's rapid expansion into private infrastructure and private credit markets, following the recently completed $12.5 billion acquisition of Global Infrastructure Partners (GIP) and the pending purchase of private markets data provider Preqin. Operating margin on an adjusted basis widened by 350 basis points to 45.8%, propelled by higher performance fees and strong organic base fee growth.

Meanwhile, San Francisco-based Wells Fargo & Co. reported third-quarter net income of $5.11 billion, or $1.42 per share, compared with $5.77 billion, or $1.48 per share, a year earlier. Excluding severance expenses, earnings significantly beat the $1.28 per share consensus forecast compiled by Wall Street analysts, sending the lender's shares more than 5% higher in New York trading.

“Our strategy is ambitious, and our strategy is working. Clients are entrusting BlackRock with record inflows across public and private markets, driving assets to nearly $11.5 trillion.” — Larry Fink, Chairman and Chief Executive Officer of BlackRock

Wells Fargo Tops Profit Forecasts on 37% Investment Banking Fee Surge

Although Wells Fargo's net interest income declined 11% year-over-year to $11.69 billion as customers shifted cash into higher-yielding deposit products amid subdued loan demand, Chief Financial Officer Mike Santomassimo noted that fourth-quarter net interest income is expected to stabilize near third-quarter levels. Credit quality also showed resilience, with the bank setting aside $1.07 billion for credit losses, below the $1.15 billion analysts had projected.

Crucially, Wells Fargo's fee-based businesses delivered a 12% increase in non-interest income to $8.68 billion, led by a 37% jump in investment banking fees across debt underwriting and advisory desks. Together with upbeat quarterly results from JPMorgan Chase, the reports underscored how rebounding capital markets activity and surging asset valuations are cushioning major U.S. financial institutions as the Federal Reserve transitions toward lower interest rates.

Sources

• BlackRock Investor Relations
• Wells Fargo Newsroom