KKR reported record quarterly results across fee-related earnings, total operating earnings, and adjusted net income. Management expressed strong confidence, highlighting record fundraising, a massive monetization quarter, and multiple secular growth drivers (AI infrastructure, Asia, insurance, private wealth). They pushed back on external pessimism, arguing the firm is on the 'happy part of the K.' Record FRE of $1.32/share (+34% YoY); total operating earnings $1.68/share (+27% YoY); adjusted net income $1.63/share (+38% YoY).
KKR reported record quarterly results across fee-related earnings, total operating earnings, and adjusted net income. Management expressed strong confidence, highlighting record fundraising, a massive monetization quarter, and multiple secular growth drivers (AI infrastructure, Asia, insurance, private wealth). They pushed back on external pessimism, arguing the firm is on the 'happy part of the K.' Record FRE of $1.32/share (+34% YoY); total operating earnings $1.68/share (+27% YoY); adjusted net income $1.63/share (+38% YoY).
KKR reported record quarterly results across fee-related earnings, total operating earnings, and adjusted net income. Management expressed strong confidence, highlighting record fundraising, a massive monetization quarter, and multiple secular growth drivers (AI infrastructure…
Record FRE of $1.32/share (+34% YoY); total operating earnings $1.68/share (+27% YoY); adjusted net income $1.63/share (+38% YoY).
Management stated that AI and the need for infrastructure build-out behind it will require trillions of dollars of investment over the coming decade. They formed Helix Digital Infrastructure, an AI infrastructure company delivering coordinated data center, power, and…
Management stated that AI and the need for infrastructure build-out behind it will require trillions of dollars of investment over the coming decade. They formed Helix Digital Infrastructure, an AI infrastructure company delivering coordinated data center, power, and…
Management stated that AI and the need for infrastructure build-out behind it will require trillions of dollars of investment over the coming decade. They formed Helix Digital Infrastructure, an AI infrastructure company delivering coordinated data center, power, and connectivity to hyperscalers, with over $10 billion of initial long-duration committed capital.
Management is very confident, citing record fundraising, monetization, and earnings growth, while dismissive of external pessimism.
KKR is seeing a global capex cycle driven by AI, digital, energy infrastructure, defense, and industrial needs. They have committed and invested over $75 billion across digital infrastructure and power, and launched Helix with over $10 billion in initial capital to further invest in AI infrastructure, with the opportunity seen in the tens of billions of dollars.
Management expressed strong confidence, citing record results across all headline metrics, a beaten three-year fundraising target in just two and a half years, and a belief that external pessimism is disconnected from the strong operating fundamentals and internal momentum.
“Hyperscaler data center spreads have widened pretty meaningfully just over the last couple of weeks.”
Hyperscaler data center spreads have widened meaningfully recently, suggesting potential pricing power shift in AI infrastructure. — Wider spreads could improve economics for data center operators and power providers, and may pressure hyperscaler capex plans.
“Navidya and Vistra joined us as important strategic partners and together with Kuwait Investment Authority and KKR as founding investors.”
… delivers coordinated data center, power, and connectivity to hyperscalers. It is a perpetual open-ended vehicle that adds to our perpetual capital base where KKR will earn management fees and performance fees. Alongside our infrastructure team, Helix is led by Adam Salipsky, who is the former CEO of Amazon Web Services. Adam brings firsthand experience scaling the world's largest cloud business and deep insight into hyperscaler priorities. Navidya and Vistra joined us as important strategic partners and together with Kuwait Investment Authority and KKR as founding investors. Pairing KKR's track record here, and our expertise with the execution capabilities at Helix. We believe that we have unique positioning against what is a megatrend. Turning to our asset management growth avenues and fundraising. The execution here has been tangible. At our April 2024 Investor Day, we set out a three-year, $300 billion fundraising target. That was an ambitious number for us at the time, given our size. Since the beginning of 2024 through June 30th of this year, we have raised $305 billion of capital, with $34 billion coming in in Q2, so beating our three-year target in just two and a half …
KKR realized a successful exit from OneStream, indicating strong returns on its software investment.
“We sold one stream, which is a software business for four and a half times our cost earlier this year.”
Hi, good morning. Thanks, everybody, for taking the question. A bit of a high-level question for you guys. So when we think about KKR's Management for Girls trajectory, really strong 2026, obviously in the back of a number of larger flagships kind of hitting the run rate. As you look forward into 27, maybe it would be helpful to just take a step back and talk through some of the biggest drivers of management fee growth into next year, given the tough comps from 2026. And how do you think about the kind of multi-year management fee growth algorithm in the business broadly?
… perception is so disconnected from the operating fundamentals and how it feels inside the firm. And in our experience, the best response to pessimism is performance. And so we're largely inclined to let the numbers do the talking. But we also recognize all the external narrative. We sympathize with how hard it must be to try to decipher what's what. So I just want to spend a second going through kind of what we hear anyway as some of the sources of pessimism that you may be getting barraged by and kind of how it feels inside the firm. And there seem to be, I would put it in five buckets. First is private credit, anxiety about that space. For us, we expect a record third-party credit fundraising year. Second area of concern tends to be private wealth. We've all seen a lot of articles about redemptions. Anxiety about the forward opportunity and whether it's different than everybody thought a year or two ago. As the guys mentioned, private wealth AUM up 70% last 12 months. Even more importantly, over 20% in the first half. and we've seen a meaningful rebound from the April lows. What you don't read about in the articles is the inflows, but we're up 20% net year to date. Third bucket of concern tends to be private equity monetizations aren't happening. You saw the results. You're the narrative record monetization year for us. Fourth is software. It's all going to be disrupted by AI. It's about 6% of our AUM. We sold one stream, which is a software business for four and a half times our cost earlier this year. And we're still seeing high single digit LTM revenue and EBITDA growth. And then the fourth, the fifth thing I'll say is the four big buckets of anxiety lead to an overall concern that this is going to slow down fundraising. And year to date, we're ahead of expectations, record LTM fundraising, We expect a record fundraising year for the firm and our momentum feels like it's accelerating. So you put all that together, net income of 40% in the quarter, 30% in the first half. So acknowledging not everything's perfect everywhere all the time, but wanted to share kind of a little bit about how it feels inside the firm right now. Our industry is increasingly K-shaped. and most of the external focus is going to be on the unhappy part of the K. We find ourselves on the happy part of the K and that's what's showing up in the numbers. Thanks for the question.
Hyperscaler data center spreads have widened meaningfully recently, suggesting potential pricing power shift in AI infrastructure. — Wider spreads could improve economics for data center operators and power providers, and may pressure hyperscaler capex plans.
Hi, thanks very much. Scott, I want to follow up on your first comment in the open remarks was about the in the midst of a mega capex mega cycle and AI powered. I think a lot of us agree. But the market certain days like yesterday and the day before feels more like We're overbilled. We're priced in. Spending is going to come down. Cash flow is going to come down. So I think it has that schizophrenia in terms of where we are in that cycle. So curious on A, what you think of that, and B, how does that impact, if any, what risk you hold for clients and on balance sheet as you think about this next industrial revolution and fully monetizing the wave versus managing that risk?
Yeah, I think, Glenn, the things I'd add on to that, and you're right, we are at this very Interesting moment in time. So hyperscaler data center spreads have widened pretty meaningfully just over the last couple of weeks. That stands in contrast to the broader IG markets, which again, still pretty much remain at their tights. And we've had year to date this flurry of jumbo deals. I saw a note a day or two ago, I think we've had more 25 plus billion dollar deals year to date than the last five or six years combined. And so it does, it feels like there's indigestion. And so to just echo what Scott said, I know our team's going to be consistent. And I think all the things that you're going to see from us are going to ring true to what we said historically. We're going to care about our counterparty. We're going to care about contract terms. And it allows us to be selective. And in that context, the volatility we're seeing, we think is helpful for us. And while the data center piece does get a lot of the press, again, the digital themes are much broader, fiber networks, mobile infrastructure. We've been very active across renewables. Again, Rob gave you some of the stats earlier. And that's, in addition, speaking about our infrastructure more broadly around things like electricity and gas transmission and wastewater networks, et cetera. So again, it just feels like there's a lot to do, even in spite of the volatility that we're seeing.