Apollo Global Management Inc. fell short of Wall Street projections for the second quarter as it struggled to balance higher fees against a drop in profits from its Athene annuities division.
The company reported an adjusted net income of $1.01 billion, roughly the same as the previous year. This translated to $1.64 per share, falling below the $1.75 per share average forecast by analysts, according to Bloomberg.
Athene’s profits saw a decrease of 11%, totaling $710 million, primarily due to reduced income from alternative investments.
Despite these setbacks, Apollo’s fee-related earnings experienced a notable increase of 17%, reaching $516 million. This growth was driven by elevated management fees and record-breaking revenues from its capital solutions division. The firm deployed $70 billion in investments during the quarter, more than twice the amount from the same period last year. This strategic move aligns Apollo with industry peers Blackstone Inc. and KKR & Co., capitalizing on a more favorable dealmaking climate.
Chief Executive Officer Marc Rowan highlighted the firm’s achievements, stating, “The business achieved record levels of quarterly debt origination, gross capital deployment, and third-party fundraising, excluding flagship private equity.”
Assets under management grew by 13% to $696 billion, bolstered by $39 billion in inflows for the quarter ending June 30. Credit assets rose by 16% to $521 billion. Apollo also raised $6 billion for a new strategy designed to co-invest alongside Athene.
Revenue from the sale of private equity assets improved, with Apollo reporting $33 million in principal investing income, a 65% increase compared to the previous year.
