KKR & Co. (KKR -0.83%), one of the biggest alternative asset managers, reported first-quarter results that topped analysts' profit and revenue forecasts.
The company said adjusted net income rose 20% to $864 million, or earnings per share (EPS) of $0.97, surpassing the average analyst estimate of $0.95, according to FactSet. In the year-ago quarter, adjusted net income was $719 million, or $0.81. Profit growth in the latest quarter was helped by gains in fee related earnings and operating earnings.
Total revenue more than tripled from a year earlier to $9.66 billion, far exceeding the analyst forecast of $1.49 billion. Revenue was $3.13 billion in the same quarter of 2023.
| Metric | Current Period | Analyst Estimate | Prior Year Period | % Change YoY |
|---|---|---|---|---|
| Adjusted Earnings Per Share | $0.97 | $0.95 | $0.36 | 169% |
| Total Revenue ($B) | $9.66 | $1.49 | $3.13 | 208% |
| Assets Under Management ($B) | $577.63 billion | - | $510.07 billion | 13% |
Understanding KKR
KKR is a alternative asset manager that invests in private equity, credit and real assets as well as hedge funds and insurance products. The firm is known for leveraging its global network and operational expertise to execute on its strategic vision.
Recently, KKR has focused on diversifying its offerings and strengthening its balance sheet. Its recent acquisition of Global Atlantic underscores a significant expansion into the insurance industry.
Quarterly highlights
During the quarter KKR raised $31 billion of new capital, which it can use for future investment opportunities. Furthermore, the acquisition of Global Atlantic's remaining stakes diversifies KKR's revenue base, aligning with long-term growth goals.
KKR's expansion into various asset classes, including climate, data centers and infrastructure, offers several avenues for future growth. This diversified investment strategy is designed to withstand market volatilities and enhance assets under management (AUM). AUM rose to $578 billion, a 13% increase from $510 billion in the year-earlier quarter.
Looking ahead
Management is optimistic about the future, citing a strong pipeline of investment opportunities and ongoing initiatives to expanded its asset base. KKR's focus on long-term capital, demonstrated by having 92% of its AUM as long-term or perpetual capital, provides a steady foundation for future growth.
Investors should monitor KKR's continued diversification efforts, especially in areas like climate investments and technology, which could significantly influence its growth trajectory. The firm's ability to navigate market conditions and leverage Global Atlantic's insurance platform will also be critical in maintaining its growth momentum.
