NEW YORK (AP) — Investment manager BlackRock Inc. said Wednesday that its second-quarter net income fell 11 percent, hurt by declines in markets that weighed on fees.
CEO Laurence Fink said the April-June quarter was marked by "market headwinds" and the "growing defensive posture of investors."
Stock markets declined during late spring and early summer due to worries about the European debt crisis and a slowdown in Asia. The Standard & Poor's 500 index fell 3.3 percent. And investors are wary. They withdrew $7.7 billion from U.S. stock funds in June — the fourth straight month that money was pulled out of such funds.
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That's reflected in the results of companies like BlackRock, which serves big institutional investors — pension funds, hedge funds and investment managers — as well as wealthy individuals.
The New York company earned $554 million, or $3.08 per share, in the April-June quarter, compared with $619 million, or $3.21 per share, a year earlier.
But adjusted results were better than expected. Removing compensation-related expenses, earnings were $3.10 per share. Analysts surveyed by FactSet expected $3.01 per share.
Revenue for the three months ended June 30 dropped 5 percent to $2.23 billion from $2.35 billion as assets under management shrank and market declines hurt performance fees. Wall Street expected $2.26 billion in revenue.
Assets under management, the value of the assets — stocks, bonds and other holdings — that BlackRock invests for its customers, fell 3 percent to $3.56 trillion because of market losses.
Performance fees fell 18 percent to $41 million because of declines in stock markets, while investment advisory, administration fees and securities lending revenue fell 5 percent to $1.99 billion.
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