KKR (KKR) Q3 2024 earnings summary

Executive summary

• Achieved record fee-related earnings (FRE) of over $1 billion in Q3, with FRE per share up 32% sequentially and 78% year-over-year, and adjusted net income per share up 57% year-over-year.

• Net income attributable to common stockholders was $600.6 million for Q3 2024, down from $1.47 billion in Q3 2023, while total revenues for Q3 2024 were $4.79 billion, up from $3.32 billion in Q3 2023.

• Total operating earnings reached $1.47 per share, a record, with over 80% of pre-tax earnings from durable, recurring businesses.

• Raised $87 billion of new capital year-to-date, more than double the prior year, and deployment totaled $61 billion, also more than double year-over-year.

• Completed the acquisition of the remaining minority interests in Global Atlantic, now owning 100% as of January 2, 2024.

Financial highlights

• Management fees were $893 million, up 5% sequentially and 18% year-over-year.

• Fee-related revenues totaled $1.4 billion, up over 50% year-over-year.

• Adjusted net income was $1.2 billion or $1.38 per share, up 57% year-over-year.

• Assets under management (AUM) reached $624.4 billion as of September 30, 2024, up from $552.8 billion at year-end 2023; fee-paying AUM was $505.7 billion.

• Insurance operating earnings were $308 million, benefiting from a $50 million actuarial review gain.

Outlook and guidance

• Expect net dividends from strategic holdings to increase materially in coming years, targeting $300+ million by 2026 and $600+ million by 2028.

• Monetization activity is expected to accelerate if market conditions remain constructive, with a visible Q4 pipeline of ~$500 million in monetization-related revenue.

• Management expects continued growth in AUM and fee-paying AUM, supported by new capital raised across private equity, real assets, and credit strategies.

• Management reaffirmed its annual dividend policy of $0.70 per share and highlighted a robust pipeline of pending realizations for Q4 2024.

• Strategic Holdings segment is expected to contribute more meaningfully to recurring earnings in future years.