Enhanced Investments - Financial Portal

Published: 2022-10-13 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 2022 Diluted EPS of $9.25, or $9.55 as adjusted
New York, October 13, 2022 – BlackRock, Inc. (NYSE: BLK) today reported financial results for the three and nine months ended September 30, 2022.

$65 billion of quarterly long-term net inflows driven by continued momentum in strategic ETFs and significant outsourcing mandates, with total net inflows of $17 billion reflecting outflows from cash management and advisory AUM

15% decrease in revenue year-over-year primarily driven by the impact of significantly lower markets and dollar appreciation on average AUM and lower performance fees

6% increase in technology services revenue year-over-year reflects continued strong client demand for Aladdin, despite the negative impact of foreign exchange movements

21% decrease in operating income (22% as adjusted) year-over-year includes the impact of $96 million of fund launch costs in the third quarter of 2021

15% decrease in diluted EPS (16% as adjusted) year-over-year also reflects a lower effective tax rate and a lower diluted share count, partially offset by lower nonoperating income, in the current quarter

$375 million of share repurchases in the current quarter

Laurence D. Fink, Chairman and CEO:

“We built BlackRock to meet our clients’ needs across all market environments. The diversity of our solutions provides clients with more choice to address their unique priorities across products, styles, and exposures. The power of our diversified platform is most evident in times of uncertainty, and clients are turning to us more than ever for our comprehensive and integrated solutions. Our wide range of investment offerings, leading technology platform, whole portfolio approach and global insights are resonating deeply as clients seek partners to help them build stronger, more resilient portfolios that meet their long-term investment goals.

“BlackRock generated industry-leading long-term net inflows of $248 billion in the first nine months of 2022, including $65 billion in the third quarter. We once again saw strong growth in bond ETFs, with $37 billion of net inflows. Active strategies reflected momentum from significant outsourcing mandates and continued demand for alternatives, where we raised $6 billion across commitments and net inflows. We had record Aladdin client mandates in the first nine months of 2022, with over half coming from multi-product solutions.

“We continue to evolve our organization, think comprehensively about our clients’ portfolios and innovate ahead of their needs, all of which is deepening connectivity across our platform. We are uniquely positioned to serve our clients’ needs with integrated investment management, technology and advisory expertise. And we are relentlessly committed to bringing together the best of BlackRock in order to deliver better outcomes that will benefit our clients, employees and shareholders.”

FINANCIAL RESULTS

	Q3			Q3
(in millions, except per share data)	2022			2021
AUM	$	7,961,373		$	9,463,662
% change		(16	)%
Average AUM	$	8,478,729		$	9,578,753
% change		(11	)%
Total net flows	$	16,907		$	75,314

GAAP basis:
Revenue	$	4,311		$	5,050
% change		(15	)%
Operating income	$	1,526		$	1,935
% change		(21	)%
Operating margin		35.4	%		38.3	%
Net income⁽¹⁾	$	1,406		$	1,681
% change		(16	)%
Diluted EPS	$	9.25		$	10.89
% change		(15	)%
Weighted-average diluted shares		152.0			154.3
% change		(2	)%

As Adjusted:
Operating income⁽²⁾	$	1,585		$	2,025
% change		(22	)%
Operating margin⁽²⁾		42.0	%		47.6	%
Net income^{(1) (2)}	$	1,451		$	1,750
% change		(17	)%
Diluted EPS⁽²⁾	$	9.55		$	11.34
% change		(16	)%

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

⁽²⁾

See notes (1) and (2) 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. Beginning in the first quarter of 2022, BlackRock updated the definitions of operating income, as adjusted, operating margin, as adjusted, and net income attributable to BlackRock, Inc., as adjusted, to include new adjustments. Such measures have been recast for 2021 to reflect the inclusion of such new adjustments.

NET FLOW HIGHLIGHTS

			Q3			YTD
(in billions)			2022			2022
Long-term net flows:			$	65		$	248

By region:

	Americas		$	83		$	129
	EMEA			(19	)		41
	APAC			1			77

By client type:

	Retail:		$	(5	)	$	(5	)
		US		(2	)		-
		International		(3	)		(5	)

	ETFs:		$	22		$	131
		Core equity		4			52
		Strategic		43			93
		Precision		(25	)		(14	)

	Institutional:		$	48		$	122
		Active		71			93
		Index		(23	)		29

Cash management net flows			$	(40	)	$	(45	)

Advisory net flows			$	(9	)	$	(9	)

Total net flows			$	17		$	193

BUSINESS RESULTS

											Q3 2022
						Q3 2022					Base fees ⁽¹⁾
						Base fees ⁽¹⁾		September 30, 2022			and securities
	Q3 2022			September 30, 2022		and securities		AUM			lending revenue
(in millions), (unaudited)	Net flows			AUM		lending revenue		% of Total			% of Total
RESULTS BY CLIENT TYPE
Retail	$	(4,887	)	$	806,498	$	1,058		10	%		29	%
ETFs		22,372			2,621,410		1,385		33	%		39	%
Institutional:
Active		71,123			1,487,285		623		18	%		18	%
Index		(23,398	)		2,352,061		230		30	%		7	%
Total institutional		47,725			3,839,346		853		48	%		25	%
Long-term		65,210			7,267,254		3,296		91	%		93	%
Cash management		(39,539	)		694,116		235		9	%		7	%
Advisory		(8,764	)		3		-		-			-
Total	$	16,907		$	7,961,373	$	3,531		100	%		100	%

RESULTS BY INVESTMENT STYLE
Active	$	64,053		$	2,141,066	$	1,635		27	%		46	%
Index and ETFs		1,157			5,126,188		1,661		64	%		47	%
Long-term		65,210			7,267,254		3,296		91	%		93	%
Cash management		(39,539	)		694,116		235		9	%		7	%
Advisory		(8,764	)		3		-		-			-
Total	$	16,907		$	7,961,373	$	3,531		100	%		100	%

RESULTS BY PRODUCT TYPE
Equity	$	(29,281	)	$	4,020,312	$	1,745		50	%		50	%
Fixed income		90,617			2,350,263		845		30	%		24	%
Multi-asset		10,057			637,445		316		8	%		9	%
Alternatives:
Illiquid alternatives		2,357			111,729		184		1	%		5	%
Liquid alternatives		(810	)		81,418		155		1	%		4	%
Currency and commodities		(7,730	)		66,087		51		1	%		1	%
Total Alternatives		(6,183	)		259,234		390		3	%		10	%
Long-term		65,210			7,267,254		3,296		91	%		93	%
Cash management		(39,539	)		694,116		235		9	%		7	%
Advisory		(8,764	)		3		-		-			-
Total	$	16,907		$	7,961,373	$	3,531		100	%		100	%

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

INVESTMENT PERFORMANCE AT September 30, 2022⁽¹⁾

	One-year period	Three-year period	Five-year period
Fixed income:
Actively managed AUM above benchmark or peer median
Taxable	50%	85%	89%
Tax-exempt	31%	36%	38%
Index AUM within or above applicable tolerance	87%	91%	96%
Equity:
Actively managed AUM above benchmark or peer median
Fundamental	36%	58%	82%
Systematic	61%	71%	68%
Index AUM within or above applicable tolerance	95%	98%	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 Thursday, October 13, 2022 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) 218-2154, or from outside the United States, (313) 209-4906, shortly before 8:30 a.m. and reference the BlackRock Conference Call (ID Number 5801239). A live, listen-only webcast will also be available via the investor relations section of www.blackrock.com.

The webcast will be available for replay by 11:30 a.m. (Eastern Time) on Thursday, October 13, 2022 and ending at midnight on Thursday, October 27, 2022. To access the replay of 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,
	2022			2021			Change			2022			Change
Revenue
Investment advisory, administration fees and securities lending revenue:
Investment advisory and administration fees	$	3,369		$	3,791		$	(422	)	$	3,528		$	(159	)
Securities lending revenue		162			152			10			160			2
Total investment advisory, administration fees and securities lending revenue		3,531			3,943			(412	)		3,688			(157	)
Investment advisory performance fees		82			345			(263	)		106			(24	)
Technology services revenue		338			320			18			332			6
Distribution fees		325			401			(76	)		361			(36	)
Advisory and other revenue		35			41			(6	)		39			(4	)
Total revenue		4,311			5,050			(739	)		4,526			(215	)

Expense
Employee compensation and benefits		1,339			1,527			(188	)		1,414			(75	)
Distribution and servicing costs		536			585			(49	)		572			(36	)
Direct fund expense		318			354			(36	)		304			14
General and administration expense		554			611			(57	)		530			24
Amortization of intangible assets		38			38			-			38			-
Total expense		2,785			3,115			(330	)		2,858			(73	)

Operating income		1,526			1,935			(409	)		1,668			(142	)

Nonoperating income (expense)
Net gain (loss) on investments		174			370			(196	)		(314	)		488
Interest and dividend income		41			14			27			21			20
Interest expense		(50	)		(48	)		(2	)		(54	)		4
Total nonoperating income (expense)		165			336			(171	)		(347	)		512

Income before income taxes		1,691			2,271			(580	)		1,321			370
Income tax expense		330			518			(188	)		358			(28	)
Net income		1,361			1,753			(392	)		963			398
Less:
Net income (loss) attributable to noncontrolling interests		(45	)		72			(117	)		(114	)		69
Net income attributable to BlackRock, Inc.	$	1,406		$	1,681		$	(275	)	$	1,077		$	329

Weighted-average common shares outstanding
Basic		150,644,985			152,120,927			(1,475,942	)		151,292,580			(647,595	)
Diluted		151,961,389			154,343,277			(2,381,888	)		152,452,320			(490,931	)
Earnings per share attributable to BlackRock, Inc. common stockholders
Basic	$	9.33		$	11.05		$	(1.72	)	$	7.12		$	2.21
Diluted	$	9.25		$	10.89		$	(1.64	)	$	7.06		$	2.19
Cash dividends declared and paid per share	$	4.88		$	4.13		$	0.75		$	4.88		$	-

Supplemental information:

AUM (end of period)	$	7,961,373		$	9,463,662		$	(1,502,289	)	$	8,487,410		$	(526,037	)
Shares outstanding (end of period)		150,461,863			151,988,234			(1,526,371	)		150,966,457			(504,594	)
GAAP:
Operating margin		35.4	%		38.3	%		(290	) bps		36.9	%		(150	) bps
Effective tax rate		19.0	%		23.6	%		(460	) bps		24.9	%		(590	) bps
As adjusted:
Operating income (1)	$	1,585		$	2,025		$	(440	)	$	1,727		$	(142	)
Operating margin (1)		42.0	%		47.6	%		(560	) bps		43.7	%		(170	) bps
Nonoperating income (expense), less net income (loss) attributable to noncontrolling interests	$	210		$	264		$	(54	)	$	(233	)	$	443
Net income attributable to BlackRock, Inc. (2)	$	1,451		$	1,750		$	(299	)	$	1,122		$	329
Diluted earnings attributable to BlackRock, Inc. common stockholders per share (2)	$	9.55		$	11.34		$	(1.79	)	$	7.36		$	2.19
Effective tax rate		19.2	%		23.6	%		(440	) bps		24.9	%		(570	) bps

See pages 11 through 13 for the reconciliation to GAAP and notes (1) and (2) to the condensed consolidated statements of income and supplemental information for more information on as adjusted items. Beginning in the first quarter of 2022, BlackRock updated the definitions of operating income, as adjusted, operating margin, as adjusted, and net income attributable to BlackRock, Inc., as adjusted, to include new adjustments. Such measures have been recast for 2021 to reflect the inclusion of such new adjustments.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND SUPPLEMENTAL INFORMATION

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


	Nine Months Ended
	September 30,
	2022			2021			Change
Revenue
Investment advisory, administration fees and securities lending revenue:
Investment advisory and administration fees	$	10,592		$	10,873		$	(281	)
Securities lending revenue		460			419			41
Total investment advisory, administration fees and securities lending revenue		11,052			11,292			(240	)
Investment advisory performance fees		286			814			(528	)
Technology services revenue		1,011			942			69
Distribution fees		1,067			1,110			(43	)
Advisory and other revenue		120			110			10
Total revenue		13,536			14,268			(732	)

Expense
Employee compensation and benefits		4,251			4,484			(233	)
Distribution and servicing costs		1,682			1,613			69
Direct fund expense		951			994			(43	)
General and administration expense		1,580			1,657			(77	)
Amortization of intangible assets		114			109			5
Total expense		8,578			8,857			(279	)

Operating income		4,958			5,411			(453	)

Nonoperating income (expense)
Net gain (loss) on investments		(242	)		766			(1,008	)
Interest and dividend income		80			41			39
Interest expense		(158	)		(155	)		(3	)
Total nonoperating income (expense)		(320	)		652			(972	)

Income before income taxes		4,638			6,063			(1,425	)
Income tax expense		951			1,490			(539	)
Net income		3,687			4,573			(886	)
Less:
Net income (loss) attributable to noncontrolling interests		(232	)		315			(547	)
Net income attributable to BlackRock, Inc.	$	3,919		$	4,258		$	(339	)

Weighted-average common shares outstanding
Basic		151,219,485			152,375,504			(1,156,019	)
Diluted		152,644,054			154,352,590			(1,708,536	)
Earnings per share attributable to BlackRock, Inc. common stockholders
Basic	$	25.92		$	27.94		$	(2.02	)
Diluted	$	25.67		$	27.59		$	(1.92	)
Cash dividends declared and paid per share	$	14.64		$	12.39		$	2.25

Supplemental information:

AUM (end of period)	$	7,961,373		$	9,463,662		$	(1,502,289	)
Shares outstanding (end of period)		150,461,863			151,988,234			(1,526,371	)
GAAP:
Operating margin		36.6	%		37.9	%		(130	) bps
Effective tax rate		19.5	%		25.9	%		(640	) bps
As adjusted:
Operating income (1)	$	5,134		$	5,640		$	(506	)
Operating margin (1)		43.3	%		46.8	%		(350	) bps
Nonoperating income (expense), less net income (loss) attributable to noncontrolling interests	$	(88	)	$	337		$	(425	)
Net income attributable to BlackRock, Inc. (2)	$	4,035		$	4,604		$	(569	)
Diluted earnings attributable to BlackRock, Inc. common stockholders per share (2)	$	26.43		$	29.83		$	(3.40	)
Effective tax rate		20.0	%		22.9	%		(290	) bps

ASSETS UNDER MANAGEMENT

(in millions), (unaudited)

Current Quarter Component Changes by Client Type and Product Type
			Net
	June 30,		inflows			Market						September 30,
	2022		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Retail:
Equity	$	371,226	$	(410	)	$	(21,565	)	$	(6,604	)	$	342,647	$	371,805
Fixed income		313,860		(4,301	)		(11,132	)		(3,450	)		294,977		309,898
Multi-asset		129,142		(400	)		(7,085	)		(843	)		120,814		128,649
Alternatives		49,197		224			(863	)		(498	)		48,060		49,000
Retail subtotal		863,425		(4,887	)		(40,645	)		(11,395	)		806,498		859,352
ETFs:
Equity		2,010,343		(8,308	)		(127,754	)		(12,782	)		1,861,499		2,020,925
Fixed income		695,888		36,905			(33,019	)		(5,712	)		694,062		709,997
Multi-asset		7,868		(96	)		(379	)		(120	)		7,273		7,678
Alternatives		70,197		(6,129	)		(5,382	)		(110	)		58,576		63,403
ETFs subtotal		2,784,296		22,372			(166,534	)		(18,724	)		2,621,410		2,802,003
Institutional:
Active:
Equity		163,697		204			(9,109	)		(4,383	)		150,409		163,850
Fixed income		661,852		59,238			(27,970	)		(7,926	)		685,194		679,686
Multi-asset		534,159		10,675			(27,890	)		(14,157	)		502,787		539,233
Alternatives		151,154		1,006			(874	)		(2,391	)		148,895		150,132
Active subtotal		1,510,862		71,123			(65,843	)		(28,857	)		1,487,285		1,532,901
Index:
Equity		1,799,854		(20,767	)		(74,499	)		(38,831	)		1,665,757		1,812,445
Fixed income		768,244		(1,225	)		(54,165	)		(36,824	)		676,030		738,424
Multi-asset		7,296		(122	)		(447	)		(156	)		6,571		7,122
Alternatives		5,209		(1,284	)		(156	)		(66	)		3,703		4,233
Index subtotal		2,580,603		(23,398	)		(129,267	)		(75,877	)		2,352,061		2,562,224
Institutional subtotal		4,091,465		47,725			(195,110	)		(104,734	)		3,839,346		4,095,125
Long-term		7,739,186		65,210			(402,289	)		(134,853	)		7,267,254		7,756,480
Cash management		739,457		(39,539	)		465			(6,267	)		694,116		720,055
Advisory ⁽³⁾		8,767		(8,764	)		-			-			3		2,194
Total	$	8,487,410	$	16,907		$	(401,824	)	$	(141,120	)	$	7,961,373	$	8,478,729
Current Quarter Component Changes by Investment Style and Product Type (Long-Term)
			Net
	June 30,		inflows			Market						September 30,
	2022		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Active:
Equity	$	393,048	$	(2,151	)	$	(23,831	)	$	(7,479	)	$	359,587	$	391,640
Fixed income		953,957		54,701			(37,653	)		(10,073	)		960,932		968,661
Multi-asset		663,295		10,273			(34,974	)		(15,000	)		623,594		667,874
Alternatives		200,348		1,230			(1,736	)		(2,889	)		196,953		199,131
Active subtotal		2,210,648		64,053			(98,194	)		(35,441	)		2,141,066		2,227,306
Index and ETFs:
ETFs:
Equity		2,010,343		(8,308	)		(127,754	)		(12,782	)		1,861,499		2,020,925
Fixed income		695,888		36,905			(33,019	)		(5,712	)		694,062		709,997
Multi-asset		7,868		(96	)		(379	)		(120	)		7,273		7,678
Alternatives		70,197		(6,129	)		(5,382	)		(110	)		58,576		63,403
ETFs subtotal		2,784,296		22,372			(166,534	)		(18,724	)		2,621,410		2,802,003
Non-ETF Index:
Equity		1,941,729		(18,822	)		(81,342	)		(42,339	)		1,799,226		1,956,460
Fixed income		789,999		(989	)		(55,614	)		(38,127	)		695,269		759,347
Multi-asset		7,302		(120	)		(448	)		(156	)		6,578		7,130
Alternatives		5,212		(1,284	)		(157	)		(66	)		3,705		4,234
Non-ETF Index subtotal		2,744,242		(21,215	)		(137,561	)		(80,688	)		2,504,778		2,727,171
Index and ETFs subtotal		5,528,538		1,157			(304,095	)		(99,412	)		5,126,188		5,529,174
Long-term	$	7,739,186	$	65,210		$	(402,289	)	$	(134,853	)	$	7,267,254	$	7,756,480
Current Quarter Component Changes by Product Type (Long-Term)
			Net
	June 30,		inflows			Market						September 30,
	2022		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Equity	$	4,345,120	$	(29,281	)	$	(232,927	)	$	(62,600	)	$	4,020,312	$	4,369,025
Fixed income		2,439,844		90,617			(126,286	)		(53,912	)		2,350,263		2,438,005
Multi-asset		678,465		10,057			(35,801	)		(15,276	)		637,445		682,682
Alternatives:
Illiquid alternatives		112,039		2,357			(786	)		(1,881	)		111,729		111,913
Liquid alternatives		83,770		(810	)		(611	)		(931	)		81,418		83,004
Currency and commodities⁽⁴⁾		79,948		(7,730	)		(5,878	)		(253	)		66,087		71,851
Alternatives subtotal		275,757		(6,183	)		(7,275	)		(3,065	)		259,234		266,768
Long-term	$	7,739,186	$	65,210		$	(402,289	)	$	(134,853	)	$	7,267,254	$	7,756,480

⁽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,
	2021		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Retail:
Equity	$	471,937	$	4,920		$	(117,332	)	$	(16,878	)	$	342,647	$	410,171
Fixed income		365,306		(13,760	)		(48,280	)		(8,289	)		294,977		331,284
Multi-asset		155,461		(423	)		(32,160	)		(2,064	)		120,814		139,882
Alternatives		47,349		4,567			(2,742	)		(1,114	)		48,060		49,086
Retail subtotal		1,040,053		(4,696	)		(200,514	)		(28,345	)		806,498		930,423
ETFs:
Equity		2,447,248		56,191			(612,386	)		(29,554	)		1,861,499		2,186,166
Fixed income		745,373		75,794			(114,073	)		(13,032	)		694,062		713,637
Multi-asset		9,119		135			(1,814	)		(167	)		7,273		8,210
Alternatives		65,614		(1,436	)		(5,368	)		(234	)		58,576		68,803
ETFs subtotal		3,267,354		130,684			(733,641	)		(42,987	)		2,621,410		2,976,816
Institutional:
Active:
Equity		199,980		5,920			(44,813	)		(10,678	)		150,409		177,383
Fixed income		767,402		49,571			(111,322	)		(20,457	)		685,194		706,230
Multi-asset		642,951		29,672			(136,467	)		(33,369	)		502,787		581,107
Alternatives		146,384		7,633			411			(5,533	)		148,895		150,093
Active subtotal		1,756,717		92,796			(292,191	)		(70,037	)		1,487,285		1,614,813
Index:
Equity		2,223,195		8,354			(463,407	)		(102,385	)		1,665,757		1,970,634
Fixed income		943,960		22,660			(185,043	)		(105,547	)		676,030		821,401
Multi-asset		8,963		(275	)		(1,582	)		(535	)		6,571		7,841
Alternatives		5,534		(1,956	)		502			(377	)		3,703		5,050
Index subtotal		3,181,652		28,783			(649,530	)		(208,844	)		2,352,061		2,804,926
Institutional subtotal		4,938,369		121,579			(941,721	)		(278,881	)		3,839,346		4,419,739
Long-term		9,245,776		247,567			(1,875,876	)		(350,213	)		7,267,254		8,326,978
Cash management		755,057		(45,416	)		(294	)		(15,231	)		694,116		729,103
Advisory ⁽³⁾		9,310		(9,306	)		(1	)		-			3		6,309
Total	$	10,010,143	$	192,845		$	(1,876,171	)	$	(365,444	)	$	7,961,373	$	9,062,390
Year-to-Date Component Changes by Investment Style and Product Type (Long-Term)
			Net
	December 31,		inflows			Market						September 30,
	2021		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Active:
Equity	$	507,103	$	(1,978	)	$	(126,436	)	$	(19,102	)	$	359,587	$	435,603
Fixed income		1,107,085		34,284			(154,848	)		(25,589	)		960,932		1,014,938
Multi-asset		798,404		29,247			(168,625	)		(35,432	)		623,594		720,981
Alternatives		193,733		12,199			(2,333	)		(6,646	)		196,953		199,178
Active subtotal		2,606,325		73,752			(452,242	)		(86,769	)		2,141,066		2,370,700
Index and ETFs:
ETFs:
Equity		2,447,248		56,191			(612,386	)		(29,554	)		1,861,499		2,186,166
Fixed income		745,373		75,794			(114,073	)		(13,032	)		694,062		713,637
Multi-asset		9,119		135			(1,814	)		(167	)		7,273		8,210
Alternatives		65,614		(1,436	)		(5,368	)		(234	)		58,576		68,803
ETFs subtotal		3,267,354		130,684			(733,641	)		(42,987	)		2,621,410		2,976,816
Non-ETF Index:
Equity		2,388,009		21,172			(499,116	)		(110,839	)		1,799,226		2,122,585
Fixed income		969,583		24,187			(189,797	)		(108,704	)		695,269		843,977
Multi-asset		8,971		(273	)		(1,584	)		(536	)		6,578		7,849
Alternatives		5,534		(1,955	)		504			(378	)		3,705		5,051
Non-ETF Index subtotal		3,372,097		43,131			(689,993	)		(220,457	)		2,504,778		2,979,462
Index and ETFs subtotal		6,639,451		173,815			(1,423,634	)		(263,444	)		5,126,188		5,956,278
Long-term	$	9,245,776	$	247,567		$	(1,875,876	)	$	(350,213	)	$	7,267,254	$	8,326,978
Year-to-Date Component Changes by Product Type (Long-Term)
			Net
	December 31,		inflows			Market						September 30,
	2021		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Equity	$	5,342,360	$	75,385		$	(1,237,938	)	$	(159,495	)	$	4,020,312	$	4,744,354
Fixed income		2,822,041		134,265			(458,718	)		(147,325	)		2,350,263		2,572,552
Multi-asset		816,494		29,109			(172,023	)		(36,135	)		637,445		737,040
Alternatives:
Illiquid alternatives		102,579		11,644			1,738			(4,232	)		111,729		109,618
Liquid alternatives		87,348		166			(3,987	)		(2,109	)		81,418		85,200
Currency and commodities⁽⁴⁾		74,954		(3,002	)		(4,948	)		(917	)		66,087		78,214
Alternatives subtotal		264,881		8,808			(7,197	)		(7,258	)		259,234		273,032
Long-term	$	9,245,776	$	247,567		$	(1,875,876	)	$	(350,213	)	$	7,267,254	$	8,326,978

⁽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 ten 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-over-Year Component Changes by Client Type and Product Type
			Net
	September 30,		inflows			Market						September 30,
	2021		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Retail:
Equity	$	445,737	$	12,827		$	(98,482	)	$	(17,435	)	$	342,647	$	420,772
Fixed income		359,161		(4,901	)		(50,539	)		(8,744	)		294,977		337,869
Multi-asset		150,953		1,887			(29,873	)		(2,153	)		120,814		142,892
Alternatives		44,776		7,011			(2,566	)		(1,161	)		48,060		48,225
Retail subtotal		1,000,627		16,824			(181,460	)		(29,493	)		806,498		949,758
ETFs:
Equity		2,250,849		126,261			(483,509	)		(32,102	)		1,861,499		2,218,065
Fixed income		716,596		108,849			(117,142	)		(14,241	)		694,062		715,480
Multi-asset		8,150		862			(1,575	)		(164	)		7,273		8,248
Alternatives		63,156		(1,345	)		(3,005	)		(230	)		58,576		67,780
ETFs subtotal		3,038,751		234,627			(605,231	)		(46,737	)		2,621,410		3,009,573
Institutional:
Active:
Equity		182,232		13,586			(34,517	)		(10,892	)		150,409		179,255
Fixed income		708,698		108,166			(109,721	)		(21,949	)		685,194		712,078
Multi-asset		605,297		43,546			(110,201	)		(35,855	)		502,787		589,124
Alternatives		142,318		11,010			1,214			(5,647	)		148,895		148,422
Active subtotal		1,638,545		176,308			(253,225	)		(74,343	)		1,487,285		1,628,879
Index:
Equity		2,119,592		(32,183	)		(313,675	)		(107,977	)		1,665,757		2,014,509
Fixed income		929,444		23,044			(165,487	)		(110,971	)		676,030		850,658
Multi-asset		8,758		(178	)		(1,391	)		(618	)		6,571		8,579
Alternatives		5,898		(2,321	)		529			(403	)		3,703		5,176
Index subtotal		3,063,692		(11,638	)		(480,024	)		(219,969	)		2,352,061		2,878,922
Institutional subtotal		4,702,237		164,670			(733,249	)		(294,312	)		3,839,346		4,507,801
Long-term		8,741,615		416,121			(1,519,940	)		(370,542	)		7,267,254		8,467,132
Cash management		712,015		(1,504	)		(436	)		(15,959	)		694,116		726,713
Advisory ⁽³⁾		10,032		(10,034	)		(3	)		8			3		7,108
Total	$	9,463,662	$	404,583		$	(1,520,379	)	$	(386,493	)	$	7,961,373	$	9,200,953
Year-over-Year Component Changes by Investment Style and Product Type (Long-Term)
			Net
	September 30,		inflows			Market						September 30,
	2021		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Active:
Equity	$	475,232	$	11,941		$	(107,690	)	$	(19,896	)	$	359,587	$	447,028
Fixed income		1,045,297		98,870			(155,637	)		(27,598	)		960,932		1,027,322
Multi-asset		756,245		45,429			(140,073	)		(38,007	)		623,594		732,008
Alternatives		187,093		18,019			(1,352	)		(6,807	)		196,953		196,646
Active subtotal		2,463,867		174,259			(404,752	)		(92,308	)		2,141,066		2,403,004
Index and ETFs:
ETFs:
Equity		2,250,849		126,261			(483,509	)		(32,102	)		1,861,499		2,218,065
Fixed income		716,596		108,849			(117,142	)		(14,241	)		694,062		715,480
Multi-asset		8,150		862			(1,575	)		(164	)		7,273		8,248
Alternatives		63,156		(1,345	)		(3,005	)		(230	)		58,576		67,780
ETFs subtotal		3,038,751		234,627			(605,231	)		(46,737	)		2,621,410		3,009,573
Non-ETF Index:
Equity		2,272,329		(17,711	)		(338,984	)		(116,408	)		1,799,226		2,167,508
Fixed income		952,006		27,439			(170,110	)		(114,066	)		695,269		873,283
Multi-asset		8,763		(174	)		(1,392	)		(619	)		6,578		8,587
Alternatives		5,899		(2,319	)		529			(404	)		3,705		5,177
Non-ETF Index subtotal		3,238,997		7,235			(509,957	)		(231,497	)		2,504,778		3,054,555
Index and ETFs subtotal		6,277,748		241,862			(1,115,188	)		(278,234	)		5,126,188		6,064,128
Long-term	$	8,741,615	$	416,121		$	(1,519,940	)	$	(370,542	)	$	7,267,254	$	8,467,132
Year-over-Year Component Changes by Product Type (Long-Term)
			Net
	September 30,		inflows			Market						September 30,
	2021		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Equity	$	4,998,410	$	120,491		$	(930,183	)	$	(168,406	)	$	4,020,312	$	4,832,601
Fixed income		2,713,899		235,158			(442,889	)		(155,905	)		2,350,263		2,616,085
Multi-asset		773,158		46,117			(143,040	)		(38,790	)		637,445		748,843
Alternatives:
Illiquid alternatives		98,321		15,449			2,340			(4,381	)		111,729		107,146
Liquid alternatives		85,052		2,037			(3,602	)		(2,069	)		81,418		85,278
Currency and commodities⁽⁴⁾		72,775		(3,131	)		(2,566	)		(991	)		66,087		77,179
Alternatives subtotal		256,148		14,355			(3,828	)		(7,441	)		259,234		269,603
Long-term	$	8,741,615	$	416,121		$	(1,519,940	)	$	(370,542	)	$	7,267,254	$	8,467,132

⁽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 thirteen 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.

SUMMARY OF REVENUE

	Three Months								Three Months					Nine Months
	Ended								Ended					Ended
	September 30,								June 30,					September 30,
(in millions), (unaudited)	2022			2021		Change			2022		Change			2022		2021		Change
Investment advisory, administration fees and securities lending revenue:
Equity:
Active	$	503		$	674	$	(171	)	$	550	$	(47	)	$	1,669	$	1,891	$	(222	)
ETFs		1,063			1,212		(149	)		1,103		(40	)		3,324		3,436		(112	)
Non-ETF Index		179			207		(28	)		186		(7	)		552		581		(29	)
Equity subtotal		1,745			2,093		(348	)		1,839		(94	)		5,545		5,908		(363	)
Fixed income:
Active		478			561		(83	)		503		(25	)		1,515		1,631		(116	)
ETFs		276			304		(28	)		274		2			839		893		(54	)
Non-ETF Index		91			121		(30	)		102		(11	)		311		350		(39	)
Fixed income subtotal		845			986		(141	)		879		(34	)		2,665		2,874		(209	)
Multi-asset		316			369		(53	)		331		(15	)		1,006		1,041		(35	)
Alternatives:
Illiquid alternatives		184			166		18			184		-			547		501		46
Liquid alternatives		155			163		(8	)		161		(6	)		483		460		23
Currency and commodities		51			55		(4	)		62		(11	)		169		163		6
Alternatives subtotal		390			384		6			407		(17	)		1,199		1,124		75
Long-term		3,296			3,832		(536	)		3,456		(160	)		10,415		10,947		(532	)
Cash management		235			111		124			232		3			637		345		292
Total investment advisory, administration fees and securities lending revenue		3,531			3,943		(412	)		3,688		(157	)		11,052		11,292		(240	)
Investment advisory performance fees:
Equity		(2	)		8		(10	)		3		(5	)		13		70		(57	)
Fixed income		(3	)		2		(5	)		13		(16	)		19		31		(12	)
Multi-asset		2			-		2			7		(5	)		14		17		(3	)
Alternatives:
Illiquid alternatives		79			50		29			65		14			181		147		34
Liquid alternatives		6			285		(279	)		18		(12	)		59		549		(490	)
Alternatives subtotal		85			335		(250	)		83		2			240		696		(456	)
Total performance fees		82			345		(263	)		106		(24	)		286		814		(528	)
Technology services revenue		338			320		18			332		6			1,011		942		69
Distribution fees:
Retrocessions		241			294		(53	)		269		(28	)		789		796		(7	)
12b-1 fees (US mutual fund distribution fees)		75			91		(16	)		80		(5	)		243		263		(20	)
Other		9			16		(7	)		12		(3	)		35		51		(16	)
Total distribution fees		325			401		(76	)		361		(36	)		1,067		1,110		(43	)
Advisory and other revenue:
Advisory		8			13		(5	)		15		(7	)		39		37		2
Other		27			28		(1	)		24		3			81		73		8
Total advisory and other revenue		35			41		(6	)		39		(4	)		120		110		10
Total revenue	$	4,311		$	5,050	$	(739	)	$	4,526	$	(215	)	$	13,536	$	14,268	$	(732	)

Highlights

•

Investment advisory, administration fees and securities lending revenue decreased $412 million from the third quarter of 2021, primarily driven by the negative impact of market beta and foreign exchange movements on average AUM, partially offset by organic base fee growth over the last twelve months and the elimination of yield-related fee waivers on money market funds. Securities lending revenue of $162 million increased from $152 million in the third quarter of 2021, primarily reflecting higher spreads.

Investment advisory, administration fees and securities lending revenue decreased $157 million from the second quarter of 2022, primarily driven by the negative impact of market beta and foreign exchange movements on average AUM, partially offset by the effect of one additional day in the quarter. Securities lending revenue of $162 million increased from $160 million in the second quarter of 2022.

•	Performance fees decreased $263 million from the third quarter of 2021, 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.

•

Technology services revenue increased $18 million from the third quarter of 2021, reflecting continued strong client demand for Aladdin, despite the negative impact of foreign exchange movements. Technology services annual contract value (“ACV”)⁽¹⁾increased 7% from the third quarter of 2021, and was similarly impacted by foreign exchange headwinds.

⁽¹⁾	See note (3) to the condensed consolidated statements of income and 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)	2022		2021		Change			2022		Change			2022		2021		Change
Operating expense
Employee compensation and benefits	$	1,339	$	1,527	$	(188	)	$	1,414	$	(75	)	$	4,251	$	4,484	$	(233	)
Distribution and servicing costs:
Retrocessions		241		294		(53	)		269		(28	)		789		796		(7	)
12b-1 costs		74		89		(15	)		78		(4	)		238		257		(19	)
Other		221		202		19			225		(4	)		655		560		95
Total distribution and servicing costs		536		585		(49	)		572		(36	)		1,682		1,613		69
Direct fund expense		318		354		(36	)		304		14			951		994		(43	)
General and administration expense:
Marketing and promotional		95		54		41			76		19			231		142		89
Occupancy and office related		99		91		8			106		(7	)		304		250		54
Portfolio services		73		66		7			67		6			209		195		14
Sub-advisory		21		27		(6	)		20		1			63		72		(9	)
Technology		156		140		16			148		8			449		373		76
Professional services		47		42		5			42		5			129		122		7
Communications		11		11		-			10		1			32		33		(1	)
Foreign exchange remeasurement		3		1		2			2		1			2		3		(1	)
Contingent consideration fair value adjustments		1		29		(28	)		-		1			2		33		(31	)
Product launch costs		-		96		(96	)		-		-			-		274		(274	)
Other general and administration		48		54		(6	)		59		(11	)		159		160		(1	)
Total general and administration expense		554		611		(57	)		530		24			1,580		1,657		(77	)
Amortization of intangible assets		38		38		-			38		-			114		109		5
Total operating expense	$	2,785	$	3,115	$	(330	)	$	2,858	$	(73	)	$	8,578	$	8,857	$	(279	)

Highlights

•	Employee compensation and benefits expense decreased $188 million from the third quarter of 2021, primarily reflecting lower incentive compensation due to lower operating income and performance fees, partially offset by higher base compensation.

Employee compensation and benefits expense decreased $75 million from the second quarter of 2022, primarily reflecting lower incentive compensation in the current quarter.

•	Direct fund expense decreased $36 million from the third quarter of 2021, primarily reflecting lower average AUM.

•

General and administration expense decreased $57 million from the third quarter of 2021, primarily driven by the impact of $96 million associated with the September 2021 close of the BlackRock ESG Capital Allocation Trust and lower contingent consideration fair value adjustments in the current quarter, partially offset by higher marketing and promotional expense, including the impact of higher travel and entertainment expense, and higher technology expense.

General and administration expense increased $24 million from the second quarter of 2022, primarily reflecting higher marketing and promotional expense.

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)	2022			2021			Change			2022			Change		2022			2021			Change
Nonoperating income (expense), GAAP basis	$	165		$	336		$	(171	)	$	(347	)	$	512	$	(320	)	$	652		$	(972	)
Less: Net income (loss) attributable to noncontrolling interests ("NCI")		(45	)		72			(117	)		(114	)		69		(232	)		315			(547	)
Nonoperating income (expense)⁽¹⁾	$	210		$	264		$	(54	)	$	(233	)	$	443	$	(88	)	$	337		$	(425	)

	Three Months									Three Months					Nine Months
	Ended									Ended					Ended
	September 30,									June 30,					September 30,
(in millions), (unaudited)	2022			2021			Change			2022			Change		2022			2021			Change
Net gain (loss) on investments⁽¹⁾
Private equity	$	20		$	124		$	(104	)	$	(8	)	$	28	$	22		$	212		$	(190	)
Real assets		9			4			5			1			8		23			10			13
Other alternatives⁽²⁾		1			13			(12	)		(5	)		6		-			43			(43	)
Other investments⁽³⁾		(58	)		(8	)		(50	)		(112	)		54		(245	)		37			(282	)
Subtotal		(28	)		133			(161	)		(124	)		96		(200	)		302			(502	)
Other gains (losses)⁽⁴⁾		247			165			82			(76	)		323		190			149			41
Total net gain (loss) on investments⁽¹⁾		219			298			(79	)		(200	)		419		(10	)		451			(461	)
Interest and dividend income		41			14			27			21			20		80			41			39
Interest expense		(50	)		(48	)		(2	)		(54	)		4		(158	)		(155	)		(3	)
Net interest expense		(9	)		(34	)		25			(33	)		24		(78	)		(114	)		36
Nonoperating income (expense)⁽¹⁾	$	210		$	264		$	(54	)	$	(233	)	$	443	$	(88	)	$	337		$	(425	)

⁽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 other as adjusted items see notes (1) and (2) to the condensed consolidated statements of income and supplemental information on pages 12 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, 2022 and 2021 primarily include nonoperating noncash pre-tax gains in connection with strategic minority investments in iCapital Network, Inc. of approximately $267 million and $107 million, respectively. The amounts for the three and nine months ended September 30, 2021 also include nonoperating noncash pre-tax gains in connection with strategic minority investments in Scalable Capital Limited of approximately $46 million. Additional amounts include noncash pre-tax gains (losses) related to the revaluation of certain other minority investments.

INCOME TAX EXPENSE

	Three Months									Three Months							Nine Months
	Ended									Ended							Ended
	September 30,									June 30,							September 30,
(in millions), (unaudited)	2022			2021			Change			2022				Change			2022			2021			Change
Income tax expense	$	330		$	518		$	(188	)		$	358		$	(28	)	$	951		$	1,490		$	(539	)
Effective tax rate		19.0	%		23.6	%		(460	) bps			24.9	%		(590	) bps		19.5	%		25.9	%		(640	) bps

Highlights

•	Third quarter 2022 income tax expense included approximately $93 million of discrete tax benefits related to the resolution of certain outstanding tax matters.

RECONCILIATION OF 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)	2022			2021			2022			2022			2021
Operating income, GAAP basis	$	1,526		$	1,935		$	1,668		$	4,958		$	5,411
Non-GAAP expense adjustments:
Amortization of intangible assets		38			38			38			114			109
Acquisition-related compensation costs		5			12			6			18			76
Contingent consideration fair value adjustments		1			29			-			2			33
Lease cost - Hudson Yards		15			11			15			42			11
Operating income, as adjusted (1)		1,585			2,025			1,727			5,134			5,640
Product launch costs and commissions		-			99			-			-			284
Operating income used for operating margin measurement	$	1,585		$	2,124		$	1,727		$	5,134		$	5,924
Revenue, GAAP basis	$	4,311		$	5,050		$	4,526		$	13,536		$	14,268
Non-GAAP adjustments:
Distribution fees		(325	)		(401	)		(361	)		(1,067	)		(1,110	)
Investment advisory fees		(211	)		(184	)		(211	)		(615	)		(503	)
Revenue used for operating margin measurement	$	3,775		$	4,465		$	3,954		$	11,854		$	12,655
Operating margin, GAAP basis		35.4	%		38.3	%		36.9	%		36.6	%		37.9	%
Operating margin, as adjusted (1)		42.0	%		47.6	%		43.7	%		43.3	%		46.8	%

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

RECONCILIATION OF 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)	2022		2021		2022		2022			2021
Net income attributable to BlackRock, Inc., GAAP basis	$	1,406	$	1,681	$	1,077	$	3,919		$	4,258
Non-GAAP adjustments:
Amortization of intangible assets, net of tax		29		29		29		87		83
Acquisition-related compensation costs, net of tax		4		9		5		14		58
Contingent consideration fair value adjustments, net of tax		1		22		-		2		25
Lease cost - Hudson Yards, net of tax		11		9		11		31			9
Income tax matters		-		-		-		(18	)		171
Net income attributable to BlackRock, Inc., as adjusted (2)	$	1,451	$	1,750	$	1,122	$	4,035		$	4,604
Diluted weighted-average common shares outstanding		152.0		154.3		152.5		152.6			154.4
Diluted earnings per common share, GAAP basis	$	9.25	$	10.89	$	7.06	$	25.67		$	27.59
Diluted earnings per common share, as adjusted (2)	$	9.55	$	11.34	$	7.36	$	26.43		$	29.83

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

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. 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. Management reviews non-GAAP financial measures, in addition to 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 comparability 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.

Beginning in the first quarter of 2022, the Company updated its definition of operating income, as adjusted, operating margin, as adjusted, and net income attributable to BlackRock, Inc., as adjusted, to include adjustments related to amortization of intangible assets, other acquisition-related costs, including compensation costs for nonrecurring retention-related deferred compensation, and contingent consideration fair value adjustments incurred in connection with certain acquisitions. Such measures have been recast for 2021 to reflect the inclusion of such new adjustments. For further information, refer to the Current Report on Form 8-K furnished on April 13, 2022.

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, to determine the long-term and annual compensation of the Company’s senior-level employees and to evaluate the Company’s relative performance against industry peers. Furthermore, this metric 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. Beginning in the first quarter of 2022, the Company updated its definition of operating income, as adjusted, to include adjustments related to amortization of intangible assets, other acquisition-related costs, including compensation costs for nonrecurring retention-related deferred compensation, and contingent consideration fair value adjustments incurred in connection with certain acquisitions. Management believes excluding the impact of these expenses when calculating operating income, as adjusted, provides a helpful indication of the Company’s financial performance over time, thereby providing helpful information for both management and investors while also increasing comparability with other companies. In addition, as previously reported in 2021, the Company recorded expense related to the lease of office space for its future headquarters located at 50 Hudson Yards in New York (“Lease cost – Hudson Yards”) from August 2021. 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 was required to record lease expense when 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 Lease cost – Hudson Yards when calculating operating income, as adjusted, is useful to assess the Company’s financial performance and enhances comparability among periods presented.

•

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) 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 note (1) above regarding operating income, as adjusted, and operating margin, as adjusted, for information on the updated presentation of non-GAAP expense adjustments related to amortization of intangible assets, other acquisition-related costs, including compensation costs for nonrecurring retention-related deferred compensation, and contingent consideration fair value adjustments incurred in connection with certain acquisitions, as well as previously reported Lease cost – Hudson Yards.

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

(3) 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. ACV represents forward-looking, annualized estimated value of the recurring subscription fees under client contracts, assuming all client contracts that come up for renewal are renewed, unless we received a notice of termination, even though such notice may not be effective until a later date. ACV also includes the annualized estimated value of new sales, for existing and new clients, when we execute client contracts, even though the recurring fees may not be effective until a later date and excludes nonrecurring fees such as implementation and consulting fees.

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, data, information and cybersecurity 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) geopolitical unrest, terrorist activities, civil or international hostilities, including the military conflict between Russia and Ukraine, and natural disasters, which may adversely affect the general economy, domestic and local financial and capital markets, specific industries or BlackRock; (18) climate change-related risks to BlackRock's business, products, operations and clients; (19) the ability to attract and retain highly talented professionals; (20) fluctuations in the carrying value of BlackRock’s economic investments; (21) 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; (22) BlackRock’s success in negotiating distribution arrangements and maintaining distribution channels for its products; (23) the failure by key third-party providers of BlackRock to fulfill their obligations to the Company; (24) operational, technological and regulatory risks associated with BlackRock’s major technology partnerships; (25) any disruption to the operations of third parties whose functions are integral to BlackRock’s exchange-traded funds (“ETF”) platform; (26) 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 (27) 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, 2022 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, 2022. The performance data does not include accounts terminated prior to September 30, 2022 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, 2022 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.