Enhanced Investments - Financial Portal

Published: 2021-10-13 00:00:00 ET

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Exhibit 99.1

INVESTOR RELATIONS:

Caroline Rodda 212.810.3442

MEDIA RELATIONS:

Brian Beades 212.810.5596

BlackRock Reports Third Quarter 2021 Diluted EPS of $10.89, or $10.95 as adjusted

New York, October 13, 2021 – BlackRock, Inc. (NYSE: BLK) today reported financial results for the three and nine months ended September 30, 2021.

$98 billion of long-term net inflows driven by continued momentum in ETFs and active strategies, with total net inflows of $75 billion reflecting outflows from low-fee cash management and advisory AUM

16% increase in revenue year-over-year reflects strong organic growth and 13% growth in technology services revenue, despite lower performance fees

10% increase in operating income (11% as adjusted) year-over-year also includes the impact of higher transaction-related expense and fund launch costs in the current quarter

23% increase in diluted EPS (19% as adjusted) year-over-year reflects higher nonoperating income, including noncash gains from strategic minority investments in the current quarter

Consistent capital management with $300 million of quarterly share repurchases

Laurence D. Fink, Chairman and CEO:

“Clients continue to seek BlackRock’s insights and advice regarding their entire portfolios, reflecting the benefits of the investments we have made to better serve their evolving needs. BlackRock generated $98 billion of long-term net inflows in the third quarter, representing 9% annualized organic base fee growth and our 6^th consecutive quarter in excess of our 5% target, once again demonstrating the strength of our diversified investment and technology platform.

“Organic growth was broad-based, spanning our active platform as well as in each of our ETF product categories. We delivered our 10^th consecutive quarter of active equity inflows and client demand for ESG remains strong, with $31 billion of inflows across our sustainable active and index strategies.

“Our long-term strategy remains centered on staying ahead of our clients’ needs and living our purpose of helping more and more people experience financial well-being. Whether through expanding investment choices, developing new retirement solutions, or enhancing our data analytics and technology capabilities, BlackRock remains committed to investing in high growth opportunities and industry-leading innovation.”

FINANCIAL RESULTS

	Q3			Q3
(in millions, except per share data)	2021			2020
AUM	$	9,463,662		$	7,808,497
% change		21	%
Average AUM	$	9,578,753		$	7,678,147
% change		25	%
Total net flows	$	75,314		$	128,701

GAAP basis:
Revenue	$	5,050		$	4,369
% change		16	%
Operating income	$	1,935		$	1,757
% change		10	%
Operating margin		38.3	%		40.2	%
Net income⁽¹⁾	$	1,681		$	1,364
% change		23	%
Diluted EPS	$	10.89		$	8.87
% change		23	%
Weighted-average diluted shares		154.3			153.7
% change		0	%

As Adjusted:
Operating income⁽²⁾	$	1,946		$	1,757
% change		11	%
Operating margin⁽²⁾		45.8	%		47.0	%
Net income^{(1) (2)}	$	1,690		$	1,418
% change		19	%
Diluted EPS⁽²⁾	$	10.95		$	9.22
% change		19	%

⁽¹⁾	Net income represents net income attributable to BlackRock, Inc.

⁽²⁾	See notes (1) through (3) to the condensed consolidated statements of income and supplemental information on pages 11 through 13 for more information on as adjusted items and the reconciliation to GAAP.

NET FLOW HIGHLIGHTS

			Q3			YTD
(in billions)			2021			2021
Long-term net flows:			$	98		$	290

By region:

	Americas		$	57		$	130
	EMEA			14			114
	APAC			27			46

By client type:

	Retail:		$	23		$	81
		US		13			46
		International		10			35

	ETFs:		$	58		$	202
		Core equity		16			67
		Strategic		33			89
		Precision		9			46

	Institutional:		$	17		$	8
		Active		26			86
		Index		(8	)		(77	)

Cash management net flows			$	(12	)	$	50

Advisory net flows			$	(10	)	$	(13	)

Total net flows			$	75		$	328

BUSINESS RESULTS

											Q3 2021
						Q3 2021					Base fees⁽¹⁾
						Base fees⁽¹⁾		September 30, 2021			and securities
	Q3 2021			September 30, 2021		and securities		AUM			lending revenue
(in millions), (unaudited)	Net flows			AUM		lending revenue		% of Total			% of Total
RESULTS BY CLIENT TYPE
Retail	$	22,672		$	1,000,627	$	1,291		11	%		33	%
ETFs		57,954			3,038,751		1,571		32	%		40	%
Institutional:
Active		25,558			1,638,545		684		17	%		17	%
Index		(8,212	)		3,063,692		286		32	%		7	%
Total institutional		17,346			4,702,237		970		49	%		24	%
Long-term		97,972			8,741,615		3,832		92	%		97	%
Cash management		(12,398	)		712,015		111		8	%		3	%
Advisory		(10,260	)		10,032		-		-			-
Total	$	75,314		$	9,463,662	$	3,943		100	%		100	%

RESULTS BY INVESTMENT STYLE
Active	$	44,528		$	2,463,867	$	1,928		26	%		49	%
Index and ETFs		53,444			6,277,748		1,904		66	%		48	%
Long-term		97,972			8,741,615		3,832		92	%		97	%
Cash management		(12,398	)		712,015		111		8	%		3	%
Advisory		(10,260	)		10,032		-		-			-
Total	$	75,314		$	9,463,662	$	3,943		100	%		100	%

RESULTS BY PRODUCT TYPE
Equity	$	33,168		$	4,998,410	$	2,093		52	%		53	%
Fixed income		27,315			2,713,899		986		29	%		25	%
Multi-asset		30,935			773,158		369		8	%		9	%
Alternatives		6,554			256,148		384		3	%		10	%
Long-term		97,972			8,741,615		3,832		92	%		97	%
Cash management		(12,398	)		712,015		111		8	%		3	%
Advisory		(10,260	)		10,032		-		-			-
Total	$	75,314		$	9,463,662	$	3,943		100	%		100	%

⁽¹⁾	Base fees include investment advisory and administration fees.

INVESTMENT PERFORMANCE AT September 30, 2021⁽¹⁾

	One-year period	Three-year period	Five-year period
Fixed income:
Actively managed AUM above benchmark or peer median
Taxable	77%	84%	92%
Tax-exempt	76%	65%	81%
Index AUM within or above applicable tolerance	90%	92%	94%
Equity:
Actively managed AUM above benchmark or peer median
Fundamental	68%	85%	87%
Systematic	53%	53%	93%
Index AUM within or above applicable tolerance	95%	96%	98%

⁽¹⁾	Past performance is not indicative of future results. The performance information shown is based on preliminary available data. Please refer to page 14 for performance disclosure detail.

TELECONFERENCE, WEBCAST AND PRESENTATION INFORMATION

Chairman and Chief Executive Officer, Laurence D. Fink, President, Robert S. Kapito, and Chief Financial Officer, Gary S. Shedlin, will host a teleconference call for investors and analysts on Wednesday, October 13, 2021 at 8:30 a.m. (Eastern Time). Members of the public who are interested in participating in the teleconference should dial, from the United States, (800) 374-0176, or from outside the United States, (706) 679-8281, shortly before 8:30 a.m. and reference the BlackRock Conference Call (ID Number 5162309). A live, listen-only webcast will also be available via the investor relations section of www.blackrock.com.

Both the teleconference and webcast will be available for replay by 11:30 a.m. (Eastern Time) on Wednesday, October 13, 2021 and ending at midnight on Wednesday, October 27, 2021. To access the replay of the teleconference, callers from the United States should dial (855) 859-2056 and callers from outside the United States should dial (404) 537-3406 and enter the Conference ID Number 5162309. To access the webcast, please visit the investor relations section of www.blackrock.com.

ABOUT BLACKROCK

BlackRock’s purpose is to help more and more people experience financial well-being. As a fiduciary to investors and a leading provider of financial technology, we help millions of people build savings that serve them throughout their lives by making investing easier and more affordable. For additional information on BlackRock, please visit www.blackrock.com/corporate | Twitter: @blackrock | LinkedIn: www.linkedin.com/company/blackrock.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND SUPPLEMENTAL INFORMATION

(in millions, except shares and per share data), (unaudited)

										Three Months
	Three Months Ended									Ended
	September 30,									June 30,
	2021			2020			Change			2021			Change
Revenue
Investment advisory, administration fees and securities lending revenue:
Investment advisory and administration fees	$	3,791		$	3,072		$	719		$	3,617		$	174
Securities lending revenue		152			153			(1	)		140			12
Total Investment advisory, administration fees and securities lending revenue		3,943			3,225			718			3,757			186
Investment advisory performance fees		345			532			(187	)		340			5
Technology services revenue		320			282			38			316			4
Distribution fees		401			288			113			369			32
Advisory and other revenue		41			42			(1	)		38			3
Total revenue		5,050			4,369			681			4,820			230

Expense
Employee compensation and benefits		1,527			1,411			116			1,548			(21	)
Distribution and servicing costs		585			456			129			523			62
Direct fund expense		354			257			97			320			34
General and administration expense		611			461			150			461			150
Amortization of intangible assets		38			27			11			37			1
Total expense		3,115			2,612			503			2,889			226

Operating income		1,935			1,757			178			1,931			4

Nonoperating income (expense)
Net gain (loss) on investments		370			269			101			314			56
Interest and dividend income		14			9			5			8			6
Interest expense		(48	)		(54	)		6			(52	)		4
Total nonoperating income (expense)		336			224			112			270			66

Income before income taxes		2,271			1,981			290			2,201			70
Income tax expense		518			464			54			654			(136	)
Net income		1,753			1,517			236			1,547			206
Less:
Net income (loss) attributable to noncontrolling interests		72			153			(81	)		169			(97	)
Net income attributable to BlackRock, Inc.	$	1,681		$	1,364		$	317		$	1,378		$	303

Weighted-average common shares outstanding
Basic		152,120,927			152,488,073			(367,146	)		152,443,039			(322,112	)
Diluted		154,343,277			153,742,264			601,013			154,417,581			(74,304	)
Earnings per share attributable to BlackRock, Inc. common stockholders
Basic	$	11.05		$	8.94		$	2.11		$	9.04		$	2.01
Diluted	$	10.89		$	8.87		$	2.02		$	8.92		$	1.97
Cash dividends declared and paid per share	$	4.13		$	3.63		$	0.50		$	4.13		$	-

Supplemental information:

AUM (end of period)	$	9,463,662		$	7,808,497		$	1,655,165		$	9,495,993		$	(32,331	)
Shares outstanding (end of period)		151,988,234			152,496,403			(508,169	)		152,298,784			(310,550	)
GAAP:
Operating margin		38.3	%		40.2	%		(190	) bps		40.1	%		(180	) bps
Effective tax rate		23.6	%		25.4	%		(180	) bps		32.2	%		(860	) bps
As adjusted:
Operating income (1)	$	1,946		$	1,757		$	189		$	1,931		$	15
Operating margin (1)		45.8	%		47.0	%		(120	) bps		44.9	%		90	bps
Nonoperating income (expense), less net income (loss) attributable to noncontrolling interests (2)	$	264		$	71		$	193		$	101		$	163
Net income attributable to BlackRock, Inc. (3)	$	1,690		$	1,418		$	272		$	1,549		$	141
Diluted earnings attributable to BlackRock, Inc. common stockholders per share (3)	$	10.95		$	9.22		$	1.73		$	10.03		$	0.92
Effective tax rate		23.6	%		22.5	%		110	bps		23.8	%		(20	) bps

See pages 11-13 for the reconciliation to GAAP and notes (1) through (3) for more information on as adjusted items.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND SUPPLEMENTAL INFORMATION

(in millions, except shares and per share data), (unaudited)


	Nine Months Ended
	September 30,
	2021			2020			Change
Revenue
Investment advisory, administration fees and securities lending revenue:
Investment advisory and administration fees	$	10,873		$	8,725		$	2,148
Securities lending revenue		419			521			(102	)
Total Investment advisory, administration fees and securities lending revenue		11,292			9,246			2,046
Investment advisory performance fees		814			685			129
Technology services revenue		942			834			108
Distribution fees		1,110			817			293
Advisory and other revenue		110			145			(35	)
Total revenue		14,268			11,727			2,541

Expense
Employee compensation and benefits		4,484			3,700			784
Distribution and servicing costs		1,613			1,330			283
Direct fund expense		994			780			214
General and administration expense		1,657			1,991			(334	)
Amortization of intangible assets		109			79			30
Total expense		8,857			7,880			977

Operating income		5,411			3,847			1,564

Nonoperating income (expense)
Net gain (loss) on investments		766			627			139
Interest and dividend income		41			34			7
Interest expense		(155	)		(151	)		(4	)
Total nonoperating income (expense)		652			510			142

Income before income taxes		6,063			4,357			1,706
Income tax expense		1,490			811			679
Net income		4,573			3,546			1,027
Less:
Net income (loss) attributable to noncontrolling interests		315			162			153
Net income attributable to BlackRock, Inc.	$	4,258		$	3,384		$	874

Weighted-average common shares outstanding
Basic		152,375,504			153,816,544			(1,441,040	)
Diluted		154,352,590			154,959,812			(607,222	)
Earnings per share attributable to BlackRock, Inc. common stockholders
Basic	$	27.94		$	22.00		$	5.94
Diluted	$	27.59		$	21.84		$	5.75
Cash dividends declared and paid per share	$	12.39		$	10.89		$	1.50

Supplemental information:

AUM (end of period)	$	9,463,662		$	7,808,497		$	1,655,165
Shares outstanding (end of period)		151,988,234			152,496,403			(508,169	)
GAAP:
Operating margin		37.9	%		32.8	%		510	bps
Effective tax rate		25.9	%		19.3	%		660	bps
As adjusted:
Operating income (1)	$	5,422		$	4,436		$	986
Operating margin (1)		45.1	%		44.3	%		80	bps
Nonoperating income (expense), less net income (loss) attributable to noncontrolling interests (2)	$	337		$	226		$	111
Net income attributable to BlackRock, Inc. (3)	$	4,438		$	3,664		$	774
Diluted earnings attributable to BlackRock, Inc. common stockholders per share (3)	$	28.75		$	23.64		$	5.11
Effective tax rate		22.9	%		21.4	%		150	bps

See pages 11-13 for the reconciliation to GAAP and notes (1) through (3) for more information on as adjusted items.

ASSETS UNDER MANAGEMENT

(in millions), (unaudited)

Current Quarter Component Changes by Client Type and Product Type
			Net
	June 30,		inflows			Market						September 30,
	2021		(outflows)			change			FX impact⁽¹⁾			2021		Average AUM⁽²⁾
Retail:
Equity	$	446,327	$	9,952		$	(7,823	)	$	(2,719	)	$	445,737	$	452,433
Fixed income		359,480		4,524			(3,156	)		(1,687	)		359,161		361,730
Multi-asset		147,228		5,395			(1,332	)		(338	)		150,953		150,409
Alternatives		42,448		2,801			(318	)		(155	)		44,776		43,690
Retail subtotal		995,483		22,672			(12,629	)		(4,899	)		1,000,627		1,008,262
ETFs:
Equity		2,257,828		34,987			(36,247	)		(5,719	)		2,250,849		2,279,480
Fixed income		700,009		22,489			(3,494	)		(2,408	)		716,596		711,729
Multi-asset		7,663		593			(70	)		(36	)		8,150		7,954
Alternatives		66,005		(115	)		(2,688	)		(46	)		63,156		65,863
ETFs subtotal		3,031,505		57,954			(42,499	)		(8,209	)		3,038,751		3,065,026
Institutional:
Active:
Equity		184,174		1,930			(2,410	)		(1,462	)		182,232		185,208
Fixed income		716,671		(5,716	)		806			(3,063	)		708,698		718,139
Multi-asset		584,582		25,477			920			(5,682	)		605,297		604,848
Alternatives		138,622		3,867			560			(731	)		142,318		140,894
Active subtotal		1,624,049		25,558			(124	)		(10,938	)		1,638,545		1,649,089
Index:
Equity		2,146,062		(13,701	)		(114	)		(12,655	)		2,119,592		2,158,274
Fixed income		936,005		6,018			139			(12,718	)		929,444		947,359
Multi-asset		9,297		(530	)		19			(28	)		8,758		9,095
Alternatives		5,709		1			222			(34	)		5,898		5,796
Index subtotal		3,097,073		(8,212	)		266			(25,435	)		3,063,692		3,120,524
Institutional subtotal		4,721,122		17,346			142			(36,373	)		4,702,237		4,769,613
Long-term		8,748,110		97,972			(54,986	)		(49,481	)		8,741,615		8,842,901
Cash management		727,603		(12,398	)		(784	)		(2,406	)		712,015		722,103
Advisory⁽³⁾		20,280		(10,260	)		23			(11	)		10,032		13,749
Total	$	9,495,993	$	75,314		$	(55,747	)	$	(51,898	)	$	9,463,662	$	9,578,753
Current Quarter Component Changes by Investment Style and Product Type (Long-Term)
			Net
	June 30,		inflows			Market						September 30,
	2021		(outflows)			change			FX impact⁽¹⁾			2021		Average AUM⁽²⁾
Active:
Equity	$	479,240	$	9,651		$	(10,660	)	$	(2,999	)	$	475,232	$	483,441
Fixed income		1,054,517		(2,662	)		(2,217	)		(4,341	)		1,045,297		1,057,426
Multi-asset		731,806		30,870			(411	)		(6,020	)		756,245		755,251
Alternatives		181,069		6,669			241			(886	)		187,093		184,583
Active subtotal		2,446,632		44,528			(13,047	)		(14,246	)		2,463,867		2,480,701
Index and ETFs:
ETFs:
Equity		2,257,828		34,987			(36,247	)		(5,719	)		2,250,849		2,279,480
Fixed income		700,009		22,489			(3,494	)		(2,408	)		716,596		711,729
Multi-asset		7,663		593			(70	)		(36	)		8,150		7,954
Alternatives		66,005		(115	)		(2,688	)		(46	)		63,156		65,863
ETFs subtotal		3,031,505		57,954			(42,499	)		(8,209	)		3,038,751		3,065,026
Non-ETF Index:
Equity		2,297,323		(11,470	)		313			(13,837	)		2,272,329		2,312,474
Fixed income		957,639		7,488			6			(13,127	)		952,006		969,802
Multi-asset		9,301		(528	)		18			(28	)		8,763		9,101
Alternatives		5,710		-			223			(34	)		5,899		5,797
Non-ETF Index subtotal		3,269,973		(4,510	)		560			(27,026	)		3,238,997		3,297,174
Index and ETFs subtotal		6,301,478		53,444			(41,939	)		(35,235	)		6,277,748		6,362,200
Long-term	$	8,748,110	$	97,972		$	(54,986	)	$	(49,481	)	$	8,741,615	$	8,842,901
Current Quarter Component Changes by Product Type (Long-Term)
			Net
	June 30,		inflows			Market						September 30,
	2021		(outflows)			change			FX impact⁽¹⁾			2021		Average AUM⁽²⁾
Equity	$	5,034,391	$	33,168		$	(46,594	)	$	(22,555	)	$	4,998,410	$	5,075,395
Fixed income		2,712,165		27,315			(5,705	)		(19,876	)		2,713,899		2,738,957
Multi-asset		748,770		30,935			(463	)		(6,084	)		773,158		772,306
Alternatives:
Illiquid alternatives		95,961		2,743			195			(578	)		98,321		97,516
Liquid alternatives		81,560		3,782			9			(299	)		85,052		83,431
Currency and commodities⁽⁴⁾		75,263		29			(2,428	)		(89	)		72,775		75,296
Alternatives subtotal		252,784		6,554			(2,224	)		(966	)		256,148		256,243
Long-term	$	8,748,110	$	97,972		$	(54,986	)	$	(49,481	)	$	8,741,615	$	8,842,901

⁽¹⁾	Foreign exchange reflects the impact of translating non-US dollar denominated AUM into US dollars for reporting purposes.

⁽²⁾	Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing four months.

⁽³⁾	Advisory AUM represents mandates linked to purchases and disposition of assets and portfolios on behalf of official institutions and long-term portfolio liquidation assignments.

⁽⁴⁾	Amounts include commodity ETFs.

ASSETS UNDER MANAGEMENT

(in millions), (unaudited)

Year-to-Date Component Changes by Client Type and Product Type
			Net
	December 31,		inflows					Market						September 30,
	2020		(outflows)			Acquisition⁽¹⁾		change			FX impact⁽²⁾			2021		Average AUM⁽³⁾
Retail:
Equity	$	338,434	$	34,153		$	41,324	$	35,459		$	(3,633	)	$	445,737	$	417,230
Fixed income		340,468		26,011			-		(4,457	)		(2,861	)		359,161		354,337
Multi-asset		132,624		10,269			-		8,505			(445	)		150,953		143,345
Alternatives		34,391		10,139			-		468			(222	)		44,776		39,976
Retail subtotal		845,917		80,572			41,324		39,975			(7,161	)		1,000,627		954,888
ETFs:
Equity		1,905,101		152,785			-		202,397			(9,434	)		2,250,849		2,142,649
Fixed income		690,033		45,804			-		(14,826	)		(4,415	)		716,596		694,541
Multi-asset		6,268		1,539			-		349			(6	)		8,150		7,279
Alternatives		67,605		1,463			-		(5,837	)		(75	)		63,156		66,272
ETFs subtotal		2,669,007		201,591			-		182,083			(13,930	)		3,038,751		2,910,741
Institutional:
Active:
Equity		169,522		(1,561	)		-		16,555			(2,284	)		182,232		179,247
Fixed income		716,269		5,606			-		(7,030	)		(6,147	)		708,698		710,668
Multi-asset		511,242		69,106			-		33,655			(8,706	)		605,297		556,569
Alternatives		127,429		12,407			-		3,682			(1,200	)		142,318		135,656
Active subtotal		1,524,462		85,558			-		46,862			(18,337	)		1,638,545		1,582,140
Index:
Equity		2,006,749		(128,801	)		-		264,183			(22,539	)		2,119,592		2,101,940
Fixed income		927,718		52,024			-		(25,447	)		(24,851	)		929,444		933,212
Multi-asset		8,599		(90	)		-		517			(268	)		8,758		8,919
Alternatives		5,617		(538	)		-		908			(89	)		5,898		5,680
Index subtotal		2,948,683		(77,405	)		-		240,161			(47,747	)		3,063,692		3,049,751
Institutional subtotal		4,473,145		8,153			-		287,023			(66,084	)		4,702,237		4,631,891
Long-term		7,988,069		290,316			41,324		509,081			(87,175	)		8,741,615		8,497,520
Cash management		666,252		50,132			-		(996	)		(3,373	)		712,015		704,580
Advisory⁽⁴⁾		22,359		(12,530	)		-		200			3			10,032		18,838
Total	$	8,676,680	$	327,918		$	41,324	$	508,285		$	(90,545	)	$	9,463,662	$	9,220,938
Year-to-Date Component Changes by Investment Style and Product Type (Long-Term)
			Net
	December 31,		inflows					Market						September 30,
	2020		(outflows)			Acquisition⁽¹⁾		change			FX impact⁽²⁾			2021		Average AUM⁽³⁾
Active:
Equity	$	410,189	$	34,854		$	-	$	34,944		$	(4,755	)	$	475,232	$	457,458
Fixed income		1,035,015		29,461			-		(10,534	)		(8,645	)		1,045,297		1,043,135
Multi-asset		643,864		79,374			-		42,158			(9,151	)		756,245		699,909
Alternatives		161,819		22,544			-		4,153			(1,423	)		187,093		175,631
Active subtotal		2,250,887		166,233			-		70,721			(23,974	)		2,463,867		2,376,133
Index and ETFs:
ETFs:
Equity		1,905,101		152,785			-		202,397			(9,434	)		2,250,849		2,142,649
Fixed income		690,033		45,804			-		(14,826	)		(4,415	)		716,596		694,541
Multi-asset		6,268		1,539			-		349			(6	)		8,150		7,279
Alternatives		67,605		1,463			-		(5,837	)		(75	)		63,156		66,272
ETFs subtotal		2,669,007		201,591			-		182,083			(13,930	)		3,038,751		2,910,741
Non-ETF Index:
Equity		2,104,516		(131,063	)		41,324		281,253			(23,701	)		2,272,329		2,240,959
Fixed income		949,440		54,180			-		(26,400	)		(25,214	)		952,006		955,082
Multi-asset		8,601		(89	)		-		519			(268	)		8,763		8,924
Alternatives		5,618		(536	)		-		905			(88	)		5,899		5,681
Non-ETF Index subtotal		3,068,175		(77,508	)		41,324		256,277			(49,271	)		3,238,997		3,210,646
Index and ETFs subtotal		5,737,182		124,083			41,324		438,360			(63,201	)		6,277,748		6,121,387
Long-term	$	7,988,069	$	290,316		$	41,324	$	509,081		$	(87,175	)	$	8,741,615	$	8,497,520
Year-to-Date Component Changes by Product Type (Long-Term)
			Net
	December 31,		inflows					Market						September 30,
	2020		(outflows)			Acquisition⁽¹⁾		change			FX impact⁽²⁾			2021		Average AUM⁽³⁾
Equity	$	4,419,806	$	56,576		$	41,324	$	518,594		$	(37,890	)	$	4,998,410	$	4,841,066
Fixed income		2,674,488		129,445			-		(51,760	)		(38,274	)		2,713,899		2,692,758
Multi-asset		658,733		80,824			-		43,026			(9,425	)		773,158		716,112
Alternatives:
Illiquid alternatives		85,770		12,315			-		1,148			(912	)		98,321		93,102
Liquid alternatives		73,218		9,455			-		2,745			(366	)		85,052		79,234
Currency and commodities⁽⁵⁾		76,054		1,701			-		(4,672	)		(308	)		72,775		75,248
Alternatives subtotal		235,042		23,471			-		(779	)		(1,586	)		256,148		247,584
Long-term	$	7,988,069	$	290,316		$	41,324	$	509,081		$	(87,175	)	$	8,741,615	$	8,497,520

⁽¹⁾	Amounts include AUM attributable to the acquisition of Aperio Group, LLC on February 1, 2021 (the “Aperio Transaction”).

⁽²⁾	Foreign exchange reflects the impact of translating non-US dollar denominated AUM into US dollars for reporting purposes.

⁽³⁾	Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing ten months.

⁽⁴⁾	Advisory AUM represents mandates linked to purchases and disposition of assets and portfolios on behalf of official institutions and long-term portfolio liquidation assignments.

⁽⁵⁾	Amounts include commodity ETFs.

ASSETS UNDER MANAGEMENT

(in millions), (unaudited)

Year-over-Year Component Changes by Client Type and Product Type
			Net
	September 30,		inflows					Market						September 30,
	2020		(outflows)			Acquisition⁽¹⁾		change			FX impact⁽²⁾			2021		Average AUM⁽³⁾
Retail:
Equity	$	279,427	$	50,248		$	41,324	$	73,968		$	770		$	445,737	$	387,825
Fixed income		316,008		40,231			-		2,060			862			359,161		347,052
Multi-asset		119,708		12,914			-		18,198			133			150,953		138,466
Alternatives		31,121		12,496			-		1,081			78			44,776		38,183
Retail subtotal		746,264		115,889			41,324		95,307			1,843			1,000,627		911,526
ETFs:
Equity		1,586,849		218,042			-		446,634			(676	)		2,250,849		2,028,304
Fixed income		662,999		59,339			-		(6,063	)		321			716,596		689,132
Multi-asset		5,430		1,955			-		736			29			8,150		6,895
Alternatives		66,057		1,008			-		(3,935	)		26			63,156		65,933
ETFs subtotal		2,321,335		280,344			-		437,372			(300	)		3,038,751		2,790,264
Institutional:
Active:
Equity		149,260		(4,379	)		-		37,231			120			182,232		173,263
Fixed income		693,061		9,122			-		5,825			690			708,698		707,349
Multi-asset		464,242		66,535			-		74,282			238			605,297		536,848
Alternatives		120,559		15,635			-		5,555			569			142,318		132,368
Active subtotal		1,427,122		86,913			-		122,893			1,617			1,638,545		1,549,828
Index:
Equity		1,768,582		(159,258	)		-		508,028			2,240			2,119,592		2,034,356
Fixed income		859,397		83,457			-		(16,605	)		3,195			929,444		919,677
Multi-asset		8,866		(982	)		-		1,029			(155	)		8,758		8,804
Alternatives		4,563		150			-		1,186			(1	)		5,898		5,512
Index subtotal		2,641,408		(76,633	)		-		493,638			5,279			3,063,692		2,968,349
Institutional subtotal		4,068,530		10,280			-		616,531			6,896			4,702,237		4,518,177
Long-term		7,136,129		406,513			41,324		1,149,210			8,439			8,741,615		8,219,967
Cash management		652,002		59,076			-		(1,215	)		2,152			712,015		695,260
Advisory⁽⁴⁾		20,366		(10,738	)		-		377			27			10,032		19,358
Total	$	7,808,497	$	454,851		$	41,324	$	1,148,372		$	10,618		$	9,463,662	$	8,934,585
Year-over-Year Component Changes by Investment Style and Product Type (Long-Term)
			Net
	September 30,		inflows					Market						September 30,
	2020		(outflows)			Acquisition⁽¹⁾		change			FX impact⁽²⁾			2021		Average AUM⁽³⁾
Active:
Equity	$	347,631	$	43,476		$	-	$	84,336		$	(211	)	$	475,232	$	434,610
Fixed income		989,412		46,244			-		8,559			1,082			1,045,297		1,032,919
Multi-asset		583,952		79,443			-		92,479			371			756,245		675,310
Alternatives		151,678		28,130			-		6,638			647			187,093		170,550
Active subtotal		2,072,673		197,293			-		192,012			1,889			2,463,867		2,313,389
Index and ETFs:
ETFs:
Equity		1,586,849		218,042			-		446,634			(676	)		2,250,849		2,028,304
Fixed income		662,999		59,339			-		(6,063	)		321			716,596		689,132
Multi-asset		5,430		1,955			-		736			29			8,150		6,895
Alternatives		66,057		1,008			-		(3,935	)		26			63,156		65,933
ETFs subtotal		2,321,335		280,344			-		437,372			(300	)		3,038,751		2,790,264
Non-ETF Index:
Equity		1,849,638		(156,865	)		41,324		534,891			3,341			2,272,329		2,160,834
Fixed income		879,054		86,566			-		(17,279	)		3,665			952,006		941,159
Multi-asset		8,864		(976	)		-		1,030			(155	)		8,763		8,808
Alternatives		4,565		151			-		1,184			(1	)		5,899		5,513
Non-ETF Index subtotal		2,742,121		(71,124	)		41,324		519,826			6,850			3,238,997		3,116,314
Index and ETFs subtotal		5,063,456		209,220			41,324		957,198			6,550			6,277,748		5,906,578
Long-term	$	7,136,129	$	406,513		$	41,324	$	1,149,210		$	8,439		$	8,741,615	$	8,219,967
Year-over-Year Component Changes by Product Type (Long-Term)
			Net
	September 30,		inflows					Market						September 30,
	2020		(outflows)			Acquisition⁽¹⁾		change			FX impact⁽²⁾			2021		Average AUM⁽³⁾
Equity	$	3,784,118	$	104,653		$	41,324	$	1,065,861		$	2,454		$	4,998,410	$	4,623,748
Fixed income		2,531,465		192,149			-		(14,783	)		5,068			2,713,899		2,663,210
Multi-asset		598,246		80,422			-		94,245			245			773,158		691,013
Alternatives:
Illiquid alternatives		79,723		16,844			-		1,660			94			98,321		90,319
Liquid alternatives		69,255		10,492			-		4,653			652			85,052		77,069
Currency and commodities⁽⁵⁾		73,322		1,953			-		(2,426	)		(74	)		72,775		74,608
Alternatives subtotal		222,300		29,289			-		3,887			672			256,148		241,996
Long-term	$	7,136,129	$	406,513		$	41,324	$	1,149,210		$	8,439		$	8,741,615	$	8,219,967

⁽¹⁾	Amounts include AUM attributable to the Aperio Transaction.

⁽²⁾	Foreign exchange reflects the impact of translating non-US dollar denominated AUM into US dollars for reporting purposes.

⁽³⁾	Average AUM is calculated as the average of the month-end spot AUM amounts for the trailing thirteen months.

⁽⁴⁾	Advisory AUM represents mandates linked to purchases and disposition of assets and portfolios on behalf of official institutions and long-term portfolio liquidation assignments.

⁽⁵⁾	Amounts include commodity ETFs.

SUMMARY OF REVENUE

	Three Months							Three Months					Nine Months
	Ended							Ended					Ended
	September 30,							June 30,					September 30,
(in millions), (unaudited)	2021		2020		Change			2021		Change			2021		2020		Change
Investment advisory, administration fees and securities lending revenue:
Equity:
Active	$	674	$	457	$	217		$	641	$	33		$	1,891	$	1,236	$	655
ETFs		1,212		880		332			1,156		56			3,436		2,551		885
Non-ETF Index		207		164		43			198		9			581		505		76
Equity subtotal		2,093		1,501		592			1,995		98			5,908		4,292		1,616
Fixed income:
Active		561		498		63			545		16			1,631		1,443		188
ETFs		304		297		7			294		10			893		817		76
Non-ETF Index		121		113		8			116		5			350		354		(4	)
Fixed income subtotal		986		908		78			955		31			2,874		2,614		260
Multi-asset		369		289		80			344		25			1,041		852		189
Alternatives:
Illiquid alternatives		166		140		26			167		(1	)		501		416		85
Liquid alternatives		163		132		31			150		13			460		361		99
Currency and commodities		55		51		4			55		-			163		118		45
Alternatives subtotal		384		323		61			372		12			1,124		895		229
Long-term		3,832		3,021		811			3,666		166			10,947		8,653		2,294
Cash management		111		204		(93	)		91		20			345		593		(248	)
Total investment advisory, administration fees and securities lending revenue		3,943		3,225		718			3,757		186			11,292		9,246		2,046
Investment advisory performance fees:
Equity		8		4		4			36		(28	)		70		29		41
Fixed income		2		9		(7	)		15		(13	)		31		13		18
Multi-asset		-		10		(10	)		9		(9	)		17		13		4
Alternatives:
Illiquid alternatives		50		6		44			90		(40	)		147		55		92
Liquid alternatives		285		503		(218	)		190		95			549		575		(26	)
Alternatives subtotal		335		509		(174	)		280		55			696		630		66
Total performance fees		345		532		(187	)		340		5			814		685		129
Technology services revenue		320		282		38			316		4			942		834		108
Distribution fees:
Retrocessions		294		188		106			264		30			796		519		277
12b-1 fees (US mutual fund distribution fees)		91		85		6			87		4			263		254		9
Other		16		15		1			18		(2	)		51		44		7
Total distribution fees		401		288		113			369		32			1,110		817		293
Advisory and other revenue:
Advisory		13		14		(1	)		9		4			37		48		(11	)
Other		28		28		-			29		(1	)		73		97		(24	)
Total advisory and other revenue		41		42		(1	)		38		3			110		145		(35	)
Total revenue	$	5,050	$	4,369	$	681		$	4,820	$	230		$	14,268	$	11,727	$	2,541

Highlights

•

Investment advisory, administration fees and securities lending revenue increased $718 million from the third quarter of 2020, primarily driven by the positive impact of market beta and foreign exchange movements on average AUM and strong organic base fee growth, partially offset by the impact of yield-related fee waivers on certain money market funds and strategic pricing changes to certain products. Securities lending revenue of $152 million decreased from $153 million in the third quarter of 2020, primarily reflecting lower asset spreads, partially offset by higher average balances of securities on loan.

Investment advisory, administration fees and securities lending revenue increased $186 million from the second quarter of 2021, primarily driven by organic growth, the positive impact of market beta on average AUM, the effect of one additional day in the quarter and lower yield-related fee waivers on certain money market funds. Securities lending revenue of $152 million increased from $140 million in the second quarter of 2021.

•

Performance fees decreased $187 million from the third quarter of 2020, primarily reflecting lower revenue from liquid alternative products, including lower fees from a single hedge fund with an annual performance measurement period that ends in the third quarter, partially offset by higher revenue from illiquid alternative products.

Performance fees increased $5 million from the second quarter of 2021, primarily reflecting higher revenue from liquid alternative products, partially offset by lower revenue from long-only mandates and illiquid alternative products.

•	Technology services revenue increased $38 million from the third quarter of 2020, primarily reflecting higher revenue from Aladdin^®. Technology services annual contract value⁽¹⁾ (“ACV”) increased 16% from the third quarter of 2020.

(1)

ACV represents forward-looking recurring subscription fees under client contracts for the next twelve months at the end of a respective quarter, assuming all client contracts that come up for renewal are renewed. ACV excludes nonrecurring fees such as implementation and consulting fees. See note (4) in the supplemental information on page 13 for more information on ACV.

SUMMARY OF OPERATING EXPENSE

	Three Months							Three Months						Nine Months
	Ended							Ended						Ended
	September 30,							June 30,						September 30,
(in millions), (unaudited)	2021		2020		Change			2021			Change			2021		2020		Change
Operating expense
Employee compensation and benefits	$	1,527	$	1,411	$	116		$	1,548		$	(21	)	$	4,484	$	3,700	$	784
Distribution and servicing costs:
Retrocessions		294		188		106			264			30			796		519		277
12b-1 costs		89		83		6			85			4			257		247		10
Other		202		185		17			174			28			560		564		(4	)
Total distribution and servicing costs		585		456		129			523			62			1,613		1,330		283
Direct fund expense		354		257		97			320			34			994		780		214
General and administration expense:
Marketing and promotional		54		48		6			53			1			142		156		(14	)
Occupancy and office related		91		81		10			80			11			250		239		11
Portfolio services		93		73		20			87			6			267		203		64
Technology		140		93		47			129			11			373		273		100
Professional services		42		36		6			41			1			122		121		1
Communications		11		14		(3	)		11			-			33		40		(7	)
Foreign exchange remeasurement		1		1		-			(2	)		3			3		7		(4	)
Contingent consideration fair value adjustments		29		-		29			1			28			33		23		10
Product launch costs		96		80		16			-			96			274		164		110
Charitable Contribution		-		-		-			-			-			-		589		(589	)
Other general and administration		54		35		19			61			(7	)		160		176		(16	)
Total general and administration expense		611		461		150			461			150			1,657		1,991		(334	)
Amortization of intangible assets		38		27		11			37			1			109		79		30
Total operating expense	$	3,115	$	2,612	$	503		$	2,889		$	226		$	8,857	$	7,880	$	977

Highlights

•

Employee compensation and benefits expense increased $116 million from the third quarter of 2020, primarily reflecting higher base compensation, driven by previously announced base salary increases and higher headcount, and higher deferred compensation, reflecting the impact of additional grants associated with prior-year compensation.

Employee compensation and benefits expense decreased $21 million from the second quarter of 2021, primarily due to lower deferred compensation, reflecting the impact of certain previous acquisition-related compensation arrangements in the second quarter of 2021, partially offset by higher base compensation associated with previously announced salary increases and higher headcount.

•	Direct fund expense increased $97 million from the third quarter of 2020 and $34 million from the second quarter of 2021, primarily reflecting higher average AUM.

•

General and administration expense increased $150 million from the third quarter of 2020 reflecting higher technology and portfolio services expense. The increase also reflected higher product launch costs, primarily associated with the September 2021 close of the BlackRock ESG Capital Allocation Trust, higher contingent consideration fair value adjustments, and $11 million of noncash occupancy expense related to the lease of office space for the Company’s future headquarters located at 50 Hudson Yards in New York (“Lease cost – Hudson Yards”), which it expects to begin to occupy in late 2022 (and begin lease payments in May 2023). Lease cost – Hudson Yards has been excluded from our “as adjusted” financial results – see pages 11 through 13 for the reconciliation to GAAP and notes (1) through (3) for more information on as adjusted items.

General and administration expense also increased $150 million from the second quarter of 2021, primarily reflecting the higher product launch costs, contingent consideration fair value adjustments, higher technology expense and occupancy expense noted above.

•	Amortization of intangible assets expense increased $11 million from the third quarter of 2020, primarily reflecting amortization of intangible assets related to the Aperio Transaction.

SUMMARY OF NONOPERATING INCOME (expense), less net income (loss) attributable TO noncontrolling interests

	Three Months									Three Months						Nine Months
	Ended									Ended						Ended
	September 30,									June 30,						September 30,
(in millions), (unaudited)	2021			2020			Change			2021			Change			2021			2020			Change
Nonoperating income (expense), GAAP basis	$	336		$	224		$	112		$	270		$	66		$	652		$	510		$	142
Less: Net income (loss) attributable to noncontrolling interests ("NCI")		72			153			(81	)		169			(97	)		315			162			153
Nonoperating income (expense)⁽¹⁾	$	264		$	71		$	193		$	101		$	163		$	337		$	348		$	(11	)

	Three Months									Three Months						Nine Months
	Ended									Ended						Ended
	September 30,									June 30,						September 30,
(in millions), (unaudited)	2021			2020			Change			2021			Change			2021			2020			Change
Net gain (loss) on investments⁽¹⁾
Private equity	$	124		$	18		$	106		$	66		$	58		$	212		$	8		$	204
Real assets		4			6			(2	)		3			1			10			11			(1	)
Other alternatives⁽²⁾		13			14			(1	)		17			(4	)		43			10			33
Other investments⁽³⁾		(8	)		55			(63	)		48			(56	)		37			35			2
Subtotal		133			93			40			134			(1	)		302			64			238
Gain related to the Charitable Contribution		-			-			-			-			-			-			122			(122	)
Other gains (losses)⁽⁴⁾		165			23			142			11			154			149			279			(130	)
Total net gain (loss) on investments⁽¹⁾		298			116			182			145			153			451			465			(14	)
Interest and dividend income		14			9			5			8			6			41			34			7
Interest expense		(48	)		(54	)		6			(52	)		4			(155	)		(151	)		(4	)
Net interest expense		(34	)		(45	)		11			(44	)		10			(114	)		(117	)		3
Nonoperating income (expense)⁽¹⁾	$	264		$	71		$	193		$	101		$	163		$	337		$	348		$	(11	)

⁽¹⁾

Net of net income (loss) attributable to NCI. Management believes nonoperating income (expense), as adjusted, is an effective measure for reviewing BlackRock’s nonoperating results, which ultimately impacts BlackRock’s book value. For more information on as adjusted items and the reconciliation to GAAP see note (2) to the condensed consolidated statements of income and supplemental information on pages 11 through 13.

⁽²⁾	Amounts primarily include net gains (losses) related to credit funds, direct hedge fund strategies and hedge fund solutions.

⁽³⁾	Amounts primarily include net gains (losses) related to unhedged equity, fixed income and multi-asset investments.

⁽⁴⁾

The amounts for the three and nine months ended September 30, 2021 include nonoperating noncash pre-tax gains in connection with strategic minority investments in iCapital Network, Inc. of approximately $107 million and Scalable Capital Limited of approximately $46 million. The amount for the nine months ended September 30, 2020 includes a nonoperating noncash pre-tax gain of approximately $240 million in connection with a recapitalization of iCapital Network, Inc. Additional amounts include noncash pre-tax gains (losses) related to the revaluation of certain other corporate minority investments.

INCOME TAX EXPENSE

	Three Months									Three Months							Nine Months
	Ended									Ended							Ended
	September 30,									June 30,							September 30,
(in millions), (unaudited)	2021			2020			Change			2021				Change			2021			2020			Change
Income tax expense	$	518		$	464		$	54			$	654		$	(136	)	$	1,490		$	811		$	679
Effective tax rate		23.6	%		25.4	%		(180	) bps			32.2	%		(860	) bps		25.9	%		19.3	%		660	bps

RECONCILIATION OF US GAAP OPERATING INCOME AND OPERATING MARGIN TO OPERATING INCOME AND OPERATING MARGIN, AS ADJUSTED
	Three Months Ended									Nine Months Ended
	September 30,						June 30,			September 30,
(in millions), (unaudited)	2021			2020			2021			2021			2020
Operating income, GAAP basis	$	1,935		$	1,757		$	1,931		$	5,411		$	3,847
Non-GAAP expense adjustment:
Lease costs - Hudson Yards		11			-			-			11			-
Charitable Contribution		-			-			-			-			589
Operating income, as adjusted (1)		1,946			1,757			1,931			5,422			4,436
Product launch costs and commissions		99			83			-			284			170
Operating income used for operating margin measurement	$	2,045		$	1,840		$	1,931		$	5,706		$	4,606
Revenue, GAAP basis	$	5,050		$	4,369		$	4,820		$	14,268		$	11,727
Non-GAAP adjustments:
Distribution fees		(401	)		(288	)		(369	)		(1,110	)		(817	)
Investment advisory fees		(184	)		(168	)		(154	)		(503	)		(513	)
Revenue used for operating margin measurement	$	4,465		$	3,913		$	4,297		$	12,655		$	10,397
Operating margin, GAAP basis		38.3	%		40.2	%		40.1	%		37.9	%		32.8	%
Operating margin, as adjusted (1)		45.8	%		47.0	%		44.9	%		45.1	%		44.3	%

See note (1) to the condensed consolidated statements of income and supplemental information on page 12 for more information on as adjusted items and the reconciliation to GAAP.

RECONCILIATION OF US GAAP NONOPERATING INCOME (EXPENSE) TO NONOPERATING INCOME (EXPENSE), LESS NET INCOME (LOSS) ATTRIBUTABLE TO NCI, AS ADJUSTED
	Three Months Ended						Nine Months Ended
	September 30,				June 30,		September 30,
(in millions), (unaudited)	2021		2020		2021		2021		2020
Nonoperating income (expense), GAAP basis	$	336	$	224	$	270	$	652	$	510
Less: Net income (loss) attributable to NCI		72		153		169		315		162
Nonoperating income (expense), net of NCI		264		71		101		337		348
Less: Gain related to the Charitable Contribution		-		-		-		-		122
Nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted (2)	$	264	$	71	$	101	$	337	$	226

See note (2) to the condensed consolidated statements of income and supplemental information on page 13 for more information on as adjusted items and the reconciliation to GAAP.

RECONCILIATION OF US GAAP NET INCOME ATTRIBUTABLE TO BLACKROCK TO NET INCOME ATTRIBUTABLE TO BLACKROCK, AS ADJUSTED
	Three Months Ended						Nine Months Ended
	September 30,				June 30,		September 30,
(in millions, except per share data), (unaudited)	2021		2020		2021		2021		2020
Net income attributable to BlackRock, Inc., GAAP basis	$	1,681	$	1,364	$	1,378	$	4,258	$	3,384
Non-GAAP adjustments:
Lease costs - Hudson Yards, net of tax		9		-		-		9		-
Charitable Contribution, net of tax		-		-		-		-		226
Income tax matters		-		54		171		171		54
Net income attributable to BlackRock, Inc., as adjusted (3)	$	1,690	$	1,418	$	1,549	$	4,438	$	3,664
Diluted weighted-average common shares outstanding		154.3		153.7		154.4		154.4		155.0
Diluted earnings per common share, GAAP basis	$	10.89	$	8.87	$	8.92	$	27.59	$	21.84
Diluted earnings per common share, as adjusted (3)	$	10.95	$	9.22	$	10.03	$	28.75	$	23.64

See note (3) to the condensed consolidated statements of income and supplemental information on page 13 for more information on as adjusted items and the reconciliation to GAAP.

NOTES TO CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND SUPPLEMENTAL INFORMATION (unaudited)

BlackRock reports its financial results in accordance with accounting principles generally accepted in the United States (“GAAP”); however, management believes evaluating the Company’s ongoing operating results may be enhanced if investors have additional non-GAAP financial measures. Management reviews non-GAAP financial measures to assess ongoing operations and considers them to be helpful, for both management and investors, in evaluating BlackRock’s financial performance over time. Management also uses non-GAAP financial measures as a benchmark to compare its performance with other companies and to enhance the comparability of this information for the reporting periods presented. Non-GAAP measures may pose limitations because they do not include all of BlackRock’s revenue and expense. BlackRock’s management does not advocate that investors consider such non-GAAP financial measures in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. Non-GAAP measures may not be comparable to other similarly titled measures of other companies.

Management uses both GAAP and non-GAAP financial measures in evaluating BlackRock’s financial performance. Adjustments to GAAP financial measures (“non-GAAP adjustments”) include certain items management deems nonrecurring or that occur infrequently, transactions that ultimately will not impact BlackRock’s book value or certain tax items that do not impact cash flow.

Computations for all periods are derived from the condensed consolidated statements of income as follows:

(1) Operating income, as adjusted, and operating margin, as adjusted: Management believes operating income, as adjusted, and operating margin, as adjusted, are effective indicators of BlackRock’s financial performance over time, and, therefore, provide useful disclosure to investors. Management believes that operating margin, as adjusted, reflects the Company’s long-term ability to manage ongoing costs in relation to its revenues. The Company uses operating margin, as adjusted, to assess the Company’s financial performance and to determine the long-term and annual compensation of the Company’s senior-level employees. Furthermore, this metric is used to evaluate the Company’s relative performance against industry peers, as it eliminates margin variability arising from the accounting of revenues and expenses related to distributing different product structures in multiple distribution channels utilized by asset managers.

•

Operating income, as adjusted, includes non-GAAP expense adjustments. During the three and nine months ended September 30, 2021, the Company recorded expense of $11 million related to the lease of office space for its future headquarters located at 50 Hudson Yards in New York (“Lease cost – Hudson Yards”). While the Company expects to begin to occupy the new office space in late 2022 (and begin cash lease payments in May 2023), the Company is required to record lease expense from August 2021 because it obtained access to the building to begin its tenant improvements. As a result, the Company is recognizing lease expense for both its current and future headquarters until its current headquarters lease expires in April 2023. Management believes removing the Lease cost – Hudson Yards when calculating operating income, as adjusted, is useful to assess its financial performance and enhances comparability among periods presented. During the nine months ended September 30, 2020, the Company contributed its remaining 20% stake in PennyMac Financial Services, Inc. (the “Charitable Contribution”). The Charitable Contribution expense of $589 million has been excluded from operating income, as adjusted, due to its nonrecurring nature.

•

Operating income used for measuring operating margin, as adjusted, is equal to operating income, as adjusted, excluding the impact of product launch costs (e.g. closed-end fund launch costs) and related commissions. Management believes the exclusion of such costs and related commissions is useful because these costs can fluctuate considerably and revenue associated with the expenditure of these costs will not fully impact BlackRock’s results until future periods.

•

Revenue used for calculating operating margin, as adjusted, is reduced to exclude all of the Company’s distribution fees, which are recorded as a separate line item on the condensed consolidated statements of income, as well as a portion of investment advisory fees received that is used to pay distribution and servicing costs. For certain products, based on distinct arrangements, distribution fees are collected by the Company and then passed-through to third-party client intermediaries. For other products, investment advisory fees are collected by the Company and a portion is passed-through to third-party client intermediaries. However, in both structures, the third-party client intermediary similarly owns the relationship with the retail client and is responsible for distributing the product and servicing the client. The amount of distribution and investment advisory fees fluctuates each period primarily based on a predetermined percentage of the value of AUM during the period. These fees also vary based on the type of investment product sold and the geographic location where it is sold. In addition, the Company may waive fees on certain products that could result in the reduction of payments to the third-party intermediaries.

(2) Nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted: Management believes nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, is an effective measure for reviewing BlackRock’s nonoperating contribution to its results and provides comparability of this information among reporting periods. Management believes nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, provides a useful measure, for both management and investors, of BlackRock’s nonoperating results, which ultimately impact BlackRock’s book value. During the nine months ended September 30, 2020, the noncash, nonoperating pre-tax gain of $122 million related to the Charitable Contribution has been excluded from nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, due to its nonrecurring nature.

(3) Net income attributable to BlackRock, Inc., as adjusted: Management believes net income attributable to BlackRock, Inc., as adjusted, and diluted earnings per common share, as adjusted, are useful measures of BlackRock’s profitability and financial performance. Net income attributable to BlackRock, Inc., as adjusted, equals net income attributable to BlackRock, Inc., GAAP basis, adjusted for significant nonrecurring items, charges that ultimately will not impact BlackRock’s book value or certain tax items that do not impact cash flow.

See aforementioned discussion regarding operating income, as adjusted, operating margin, as adjusted, and nonoperating income (expense), less net income (loss) attributable to NCI, as adjusted, for information on the Lease cost – Hudson Yards and Charitable Contribution.

The nine months ended September 30, 2020 included a discrete tax benefit of $241 million that was recognized in connection with the Charitable Contribution. The discrete tax benefit has been excluded from as adjusted results due to the nonrecurring nature of the Charitable Contribution. Amounts for income tax matters represent net noncash (benefits) expense primarily associated with the revaluation of certain deferred tax liabilities related to intangible assets and goodwill as a result of tax rate changes. These amounts have been excluded from the as adjusted results as these items will not have a cash flow impact and to ensure comparability among periods presented.

Per share amounts reflect net income attributable to BlackRock, Inc., as adjusted, divided by diluted weighted-average common shares outstanding.

(4) ACV: Management believes ACV is an effective metric for reviewing BlackRock’s technology services’ ongoing contribution to its operating results and provides comparability of this information among reporting periods while also providing a useful supplemental metric for both management and investors of BlackRock’s growth in technology services revenue over time, as it is linked to the net new business in technology services.

FORWARD-LOOKING STATEMENTS

This earnings release, and other statements that BlackRock may make, may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act, with respect to BlackRock’s future financial or business performance, strategies or expectations. Forward-looking statements are typically identified by words or phrases such as “trend,” “potential,” “opportunity,” “pipeline,” “believe,” “comfortable,” “expect,” “anticipate,” “current,” “intention,” “estimate,” “position,” “assume,” “outlook,” “continue,” “remain,” “maintain,” “sustain,” “seek,” “achieve,” and similar expressions, or future or conditional verbs such as “will,” “would,” “should,” “could,” “may” and similar expressions.

BlackRock cautions that forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made, and BlackRock assumes no duty to and does not undertake to update forward-looking statements. Actual results could differ materially from those anticipated in forward-looking statements and future results could differ materially from historical performance.

BlackRock has previously disclosed risk factors in its Securities and Exchange Commission (“SEC”) reports. These risk factors and those identified elsewhere in this earnings release, among others, could cause actual results to differ materially from forward-looking statements or historical performance and include: (1) a pandemic or health crisis, including the COVID-19 pandemic, and its continued impact on financial institutions, the global economy or capital markets, as well as BlackRock’s products, clients, vendors and employees, and BlackRock’s results of operations, the full extent of which may be unknown; (2) the introduction, withdrawal, success and timing of business initiatives and strategies; (3) changes and volatility in political, economic or industry conditions, the interest rate environment, foreign exchange rates or financial and capital markets, which could result in changes in demand for products or services or in the value of assets under management (“AUM”); (4) the relative and absolute investment performance of BlackRock’s investment products; (5) BlackRock’s ability to develop new products and services that address client preferences; (6) the impact of increased competition; (7) the impact of future acquisitions or divestitures; (8) BlackRock’s ability to integrate acquired businesses successfully; (9) the unfavorable resolution of legal proceedings; (10) the extent and timing of any share repurchases; (11) the impact, extent and timing of technological changes and the adequacy of intellectual property, information and cyber security protection; (12) attempts to circumvent BlackRock’s operational control environment or the potential for human error in connection with BlackRock’s operational systems; (13) the impact of legislative and regulatory actions and reforms and regulatory, supervisory or enforcement actions of government agencies relating to BlackRock; (14) changes in law and policy and uncertainty pending any such changes; (15) any failure to effectively manage conflicts of interest; (16) damage to BlackRock’s reputation; (17) terrorist activities, civil unrest, international hostilities and natural disasters, which may adversely affect the general economy, domestic and local financial and capital markets, specific industries or BlackRock; (18) the ability to attract and retain highly talented professionals; (19) fluctuations in the carrying value of BlackRock’s economic investments; (20) the impact of changes to tax legislation, including income, payroll and transaction taxes, and taxation on products or transactions, which could affect the value proposition to clients and, generally, the tax position of the Company; (21) BlackRock’s success in negotiating distribution arrangements and maintaining distribution channels for its products; (22) the failure by a key vendor of BlackRock to fulfill its obligations to the Company; (23) operational, technological and regulatory risks associated with BlackRock’s major technology partnerships; (24) any disruption to the operations of third parties whose functions are integral to BlackRock’s exchange-traded funds platform; (25) the impact of BlackRock electing to provide support to its products from time to time and any potential liabilities related to securities lending or other indemnification obligations; and (26) the impact of problems at other financial institutions or the failure or negative performance of products at other financial institutions.

BlackRock’s Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and BlackRock’s subsequent filings with the SEC, accessible on the SEC’s website at www.sec.gov and on BlackRock’s website at www.blackrock.com, discuss these factors in more detail and identify additional factors that can affect forward-looking statements. The information contained on the Company’s website is not a part of this earnings release.

PERFORMANCE NOTES

Past performance is not indicative of future results. Except as specified, the performance information shown is as of September 30, 2021 and is based on preliminary data available at that time. The performance data shown reflects information for all actively and passively managed equity and fixed income accounts, including US registered investment companies, European-domiciled retail funds and separate accounts for which performance data is available, including performance data for high net worth accounts available as of August 31, 2021. The performance data does not include accounts terminated prior to September 30, 2021 and accounts for which data has not yet been verified. If such accounts had been included, the performance data provided may have substantially differed from that shown.

Performance comparisons shown are gross-of-fees for institutional and high net worth separate accounts, and net-of-fees for retail funds. The performance tracking shown for index accounts is based on gross-of-fees performance and includes all institutional accounts and all iShares^® funds globally using an index strategy. AUM information is based on AUM available as of September 30, 2021 for each account or fund in the asset class shown without adjustment for overlapping management of the same account or fund. Fund performance reflects the reinvestment of dividends and distributions.

Performance shown is derived from applicable benchmarks or peer median information, as selected by BlackRock, Inc. Peer medians are based in part on data either from Lipper, Inc. or Morningstar, Inc. for each included product.