BlackRock Inc (NYSE:BLK) reported a jump in revenue and assets under management (AUM) despite what the firm called “market uncertainty”, although both missed Street expectations.
The New York wealth management company reported in the three months ended September a 14% increase in AUM to $9.10 trillion from $7.96 trillion including $307 billion of net inflows, positive across ETFs, active, and cash management.
On a GAAP reporting basis, revenue rose 5% to $4.52 billion from $4.31 billion the year prior, operating income climbed 7% to $1.64 billion from $1.53 billion, net income advanced 14% to $1.60 billion from $1.41 billion and diluted EPS rose 15% to $10.66 from $9.25.
The market had forecast revenue of $4.57 billion and earnings of $8.51 per share, alongside AUM of $9.58 trillion.
Blackrock said it had seen $3 billion of quarterly net inflows reflecting $49 billion of net outflows from lower-fee institutional index equity strategies, including $19 billion from a single international client.
Laurence Fink, chairman and chief executive, said: “For the first time in nearly two decades, clients are earning a real return in cash and can wait for more policy and market certainty before re-risking. This dynamic weighed on industry and BlackRock third quarter flows.”
“The long-term trend of clients consolidating more of their portfolios with BlackRock is only accelerating, and underlying business momentum remains strong,” he added.
He added that technology services grew 20% annually in the quarter, "reflecting sustained demand for Aladdin and several large eFront renewals – continued affirmation of whole portfolio analytics as the future of asset management technology."
Aladdin is an electronic system built by BlackRock Solutions, its risk management division. eFront is focused on helping investors optimise deal flow processes such as contact management, deal tracking and workflow automation.
The company declared a quarterly dividend of $5.00 per share, up 2.5% from $4.88 a year ago.
Shares were around 1% lower in pre-market trading.