Enhanced Investments - Financial Portal

Published: 2022-07-15 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 Second Quarter 2022 Diluted EPS of $7.06, or $7.36 as adjusted
New York, July 15, 2022 – BlackRock, Inc. (NYSE: BLK) today reported financial results for the three and six months ended June 30, 2022.

$90 billion of quarterly total net inflows reflects continued strength of broad-based platform with positive flows across all product types and regions

6% 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

5% increase in technology services revenue year-over-year reflects continued strong client demand for Aladdin, despite the negative impact of foreign exchange movements

14% decrease in operating income year-over-year

21% decrease in diluted EPS (30% as adjusted) year-over-year also reflects lower nonoperating income in the current quarter

$500 million of share repurchases in the current quarter

Laurence D. Fink, Chairman and CEO:

“The first half of 2022 brought an investment environment that we have not seen in decades. Investors are simultaneously navigating high inflation, rising rates and the worst start to the year for both stocks and bonds in half a century, with global equity and fixed income indexes down 20% and 10%, respectively.

“BlackRock generated net inflows of $90 billion in the second quarter demonstrating our ability, once again, to deliver industry-leading organic growth even in the most challenging of environments. Our connectivity with clients has never been stronger. Over the last twelve months, we’ve delivered over $460 billion of net inflows reflecting 5% organic base fee growth.

“I cannot think of a time when BlackRock’s strategic focus has been more aligned with the needs of our clients than it is today. ETFs generated $52 billion of net inflows, led by fixed income net inflows of $31 billion. Active strategies continued to reflect demand for systematic equity, LifePath target-date solutions and alternatives, where we raised nearly $8 billion across commitments and net inflows. BlackRock’s cash platform reached record AUM levels in the quarter, generating $21 billion of net inflows. And, we had record Aladdin client mandates in the first half of 2022.

“Over the course of BlackRock’s 34-year history, we have experienced numerous periods of volatility and uncertainty, and BlackRock has always come through stronger. It is during periods like these that we differentiate ourselves even more with clients and further deepen those relationships. I see more opportunities for BlackRock today than ever before, and remain confident in our ability to deliver long-term growth for our clients, shareholders and employees.”

FINANCIAL RESULTS

	Q2			Q2
(in millions, except per share data)	2022			2021
AUM	$	8,487,410		$	9,495,993
% change		(11	)%
Average AUM	$	9,022,278		$	9,317,092
% change		(3	)%
Total net flows	$	89,573		$	80,960

GAAP basis:
Revenue	$	4,526		$	4,820
% change		(6	)%
Operating income	$	1,668		$	1,931
% change		(14	)%
Operating margin		36.9	%		40.1	%
Net income⁽¹⁾	$	1,077		$	1,378
% change		(22	)%
Diluted EPS	$	7.06		$	8.92
% change		(21	)%
Weighted-average diluted shares		152.5			154.4
% change		(1	)%

As Adjusted:
Operating income⁽²⁾	$	1,727		$	2,016
% change		(14	)%
Operating margin⁽²⁾		43.7	%		46.9	%
Net income^{(1) (2)}	$	1,122		$	1,614
% change		(30	)%
Diluted EPS⁽²⁾	$	7.36		$	10.45
% change		(30	)%

⁽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

			Q2			YTD
(in billions)			2022			2022
Long-term net flows:			$	69		$	182

By region:

	Americas		$	18		$	46
	EMEA			15			60
	APAC			36			76

By client type:

	Retail:		$	(10	)	$	-
		US		(7	)		1
		International		(3	)		(1	)

	ETFs:		$	52		$	108
		Core equity		15			48
		Strategic		36			50
		Precision		1			10

	Institutional:		$	26		$	74
		Active		5			22
		Index		21			52

Cash management net flows			$	21		$	(6	)

Advisory net flows			$	-		$	(1	)

Total net flows			$	90		$	176

BUSINESS RESULTS

											Q2 2022
						Q2 2022					Base fees ⁽¹⁾
						Base fees ⁽¹⁾		June 30, 2022			and securities
	Q2 2022			June 30, 2022		and securities		AUM			lending revenue
(in millions), (unaudited)	Net flows			AUM		lending revenue		% of Total			% of Total
RESULTS BY CLIENT TYPE
Retail	$	(9,973	)	$	863,425	$	1,139		10	%		31	%
ETFs		52,103			2,784,296		1,436		33	%		39	%
Institutional:
Active		5,275			1,510,862		636		18	%		17	%
Index		21,208			2,580,603		245		30	%		7	%
Total institutional		26,483			4,091,465		881		48	%		24	%
Long-term		68,613			7,739,186		3,456		91	%		94	%
Cash management		21,218			739,457		232		9	%		6	%
Advisory		(258	)		8,767		-		-			-
Total	$	89,573		$	8,487,410	$	3,688		100	%		100	%

RESULTS BY INVESTMENT STYLE
Active	$	(10,339	)	$	2,210,648	$	1,727		26	%		47	%
Index and ETFs		78,952			5,528,538		1,729		65	%		47	%
Long-term		68,613			7,739,186		3,456		91	%		94	%
Cash management		21,218			739,457		232		9	%		6	%
Advisory		(258	)		8,767		-		-			-
Total	$	89,573		$	8,487,410	$	3,688		100	%		100	%

RESULTS BY PRODUCT TYPE
Equity	$	28,642		$	4,345,120	$	1,839		51	%		50	%
Fixed income		36,126			2,439,844		879		29	%		24	%
Multi-asset		1,380			678,465		331		8	%		9	%
Alternatives		2,465			275,757		407		3	%		11	%
Long-term		68,613			7,739,186		3,456		91	%		94	%
Cash management		21,218			739,457		232		9	%		6	%
Advisory		(258	)		8,767		-		-			-
Total	$	89,573		$	8,487,410	$	3,688		100	%		100	%

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

INVESTMENT PERFORMANCE AT JUNE 30, 2022⁽¹⁾

	One-year period	Three-year period	Five-year period
Fixed income:
Actively managed AUM above benchmark or peer median
Taxable	49%	83%	89%
Tax-exempt	27%	33%	34%
Index AUM within or above applicable tolerance	89%	93%	94%
Equity:
Actively managed AUM above benchmark or peer median
Fundamental	35%	71%	83%
Systematic	59%	61%	81%
Index AUM within or above applicable tolerance	95%	95%	95%

⁽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 Friday, July 15, 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, (866) 409-1555, or from outside the United States, (313) 209-4906, shortly before 8:30 a.m. and reference the BlackRock Conference Call (ID Number 9540818). 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 Friday, July 15, 2022 and ending at midnight on Friday, July 29, 2022. To access the replay of the teleconference, callers from the United States should dial (888) 203-1112 and callers from outside the United States should dial (719) 457-0820 and enter the Conference ID Number 9540818. 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
	June 30,									March 31,
	2022			2021			Change			2022			Change
Revenue
Investment advisory, administration fees and securities lending revenue:
Investment advisory and administration fees	$	3,528		$	3,617		$	(89	)	$	3,695		$	(167	)
Securities lending revenue		160			140			20			138			22
Total investment advisory, administration fees and securities lending revenue		3,688			3,757			(69	)		3,833			(145	)
Investment advisory performance fees		106			340			(234	)		98			8
Technology services revenue		332			316			16			341			(9	)
Distribution fees		361			369			(8	)		381			(20	)
Advisory and other revenue		39			38			1			46			(7	)
Total revenue		4,526			4,820			(294	)		4,699			(173	)

Expense
Employee compensation and benefits		1,414			1,548			(134	)		1,498			(84	)
Distribution and servicing costs		572			523			49			574			(2	)
Direct fund expense		304			320			(16	)		329			(25	)
General and administration expense		530			461			69			496			34
Amortization of intangible assets		38			37			1			38			-
Total expense		2,858			2,889			(31	)		2,935			(77	)

Operating income		1,668			1,931			(263	)		1,764			(96	)

Nonoperating income (expense)
Net gain (loss) on investments		(314	)		314			(628	)		(102	)		(212	)
Interest and dividend income		21			8			13			18			3
Interest expense		(54	)		(52	)		(2	)		(54	)		-
Total nonoperating income (expense)		(347	)		270			(617	)		(138	)		(209	)

Income before income taxes		1,321			2,201			(880	)		1,626			(305	)
Income tax expense		358			654			(296	)		263			95
Net income		963			1,547			(584	)		1,363			(400	)
Less:
Net income (loss) attributable to noncontrolling interests		(114	)		169			(283	)		(73	)		(41	)
Net income attributable to BlackRock, Inc.	$	1,077		$	1,378		$	(301	)	$	1,436		$	(359	)

Weighted-average common shares outstanding
Basic		151,292,580			152,443,039			(1,150,459	)		151,732,845			(440,265	)
Diluted		152,452,320			154,417,581			(1,965,261	)		153,530,395			(1,078,075	)
Earnings per share attributable to BlackRock, Inc. common stockholders
Basic	$	7.12		$	9.04		$	(1.92	)	$	9.46		$	(2.34	)
Diluted	$	7.06		$	8.92		$	(1.86	)	$	9.35		$	(2.29	)
Cash dividends declared and paid per share	$	4.88		$	4.13		$	0.75		$	4.88		$	-

Supplemental information:

AUM (end of period)	$	8,487,410		$	9,495,993		$	(1,008,583	)	$	9,569,513		$	(1,082,103	)
Shares outstanding (end of period)		150,966,457			152,298,784			(1,332,327	)		151,725,643			(759,186	)
GAAP:
Operating margin		36.9	%		40.1	%		(320	) bps		37.5	%		(60	) bps
Effective tax rate		24.9	%		32.2	%		(730	) bps		15.5	%		940	bps
As adjusted:
Operating income (1)	$	1,727		$	2,016		$	(289	)	$	1,822		$	(95	)
Operating margin (1)		43.7	%		46.9	%		(320	) bps		44.2	%		(50	) bps
Nonoperating income (expense), less net income (loss) attributable to noncontrolling interests	$	(233	)	$	101		$	(334	)	$	(65	)	$	(168	)
Net income attributable to BlackRock, Inc. (2)	$	1,122		$	1,614		$	(492	)	$	1,462		$	(340	)
Diluted earnings attributable to BlackRock, Inc. common stockholders per share (2)	$	7.36		$	10.45		$	(3.09	)	$	9.52		$	(2.16	)
Effective tax rate		24.9	%		23.8	%		110	bps		16.8	%		810	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)


	Six Months Ended
	June 30,
	2022			2021			Change
Revenue
Investment advisory, administration fees and securities lending revenue:
Investment advisory and administration fees	$	7,223		$	7,082		$	141
Securities lending revenue		298			267			31
Total investment advisory, administration fees and securities lending revenue		7,521			7,349			172
Investment advisory performance fees		204			469			(265	)
Technology services revenue		673			622			51
Distribution fees		742			709			33
Advisory and other revenue		85			69			16
Total revenue		9,225			9,218			7

Expense
Employee compensation and benefits		2,912			2,957			(45	)
Distribution and servicing costs		1,146			1,028			118
Direct fund expense		633			640			(7	)
General and administration expense		1,026			1,046			(20	)
Amortization of intangible assets		76			71			5
Total expense		5,793			5,742			51

Operating income		3,432			3,476			(44	)

Nonoperating income (expense)
Net gain (loss) on investments		(416	)		396			(812	)
Interest and dividend income		39			27			12
Interest expense		(108	)		(107	)		(1	)
Total nonoperating income (expense)		(485	)		316			(801	)

Income before income taxes		2,947			3,792			(845	)
Income tax expense		621			972			(351	)
Net income		2,326			2,820			(494	)
Less:
Net income (loss) attributable to noncontrolling interests		(187	)		243			(430	)
Net income attributable to BlackRock, Inc.	$	2,513		$	2,577		$	(64	)

Weighted-average common shares outstanding
Basic		151,511,496			152,504,902			(993,406	)
Diluted		152,990,147			154,359,353			(1,369,206	)
Earnings per share attributable to BlackRock, Inc. common stockholders
Basic	$	16.59		$	16.90		$	(0.31	)
Diluted	$	16.43		$	16.69		$	(0.26	)
Cash dividends declared and paid per share	$	9.76		$	8.26		$	1.50

Supplemental information:

AUM (end of period)	$	8,487,410		$	9,495,993		$	(1,008,583	)
Shares outstanding (end of period)		150,966,457			152,298,784			(1,332,327	)
GAAP:
Operating margin		37.2	%		37.7	%		(50	) bps
Effective tax rate		19.8	%		27.4	%		(760	) bps
As adjusted:
Operating income (1)	$	3,549		$	3,615		$	(66	)
Operating margin (1)		43.9	%		46.4	%		(250	) bps
Nonoperating income (expense), less net income (loss) attributable to noncontrolling interests	$	(298	)	$	73		$	(371	)
Net income attributable to BlackRock, Inc. (2)	$	2,584		$	2,854		$	(270	)
Diluted earnings attributable to BlackRock, Inc. common stockholders per share (2)	$	16.89		$	18.49		$	(1.60	)
Effective tax rate		20.5	%		22.6	%		(210	) bps

ASSETS UNDER MANAGEMENT

(in millions), (unaudited)

Current Quarter Component Changes by Client Type and Product Type
			Net
	March 31,		inflows			Market						June 30,
	2022		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Retail:
Equity	$	446,043	$	(872	)	$	(66,388	)	$	(7,557	)	$	371,226	$	409,171
Fixed income		343,712		(7,563	)		(18,397	)		(3,892	)		313,860		328,816
Multi-asset		149,480		(3,000	)		(16,394	)		(944	)		129,142		139,662
Alternatives		49,888		1,462			(1,681	)		(472	)		49,197		49,900
Retail subtotal		989,123		(9,973	)		(102,860	)		(12,865	)		863,425		927,549
ETFs:
Equity		2,350,421		23,328			(348,798	)		(14,608	)		2,010,343		2,178,149
Fixed income		712,767		30,739			(41,926	)		(5,692	)		695,888		702,485
Multi-asset		8,716		161			(942	)		(67	)		7,868		8,246
Alternatives		78,592		(2,125	)		(6,159	)		(111	)		70,197		75,187
ETFs subtotal		3,150,496		52,103			(397,825	)		(20,478	)		2,784,296		2,964,067
Institutional:
Active:
Equity		188,822		3,885			(23,962	)		(5,048	)		163,697		176,618
Fixed income		718,225		(6,774	)		(40,123	)		(9,476	)		661,852		687,561
Multi-asset		617,843		4,866			(72,880	)		(15,670	)		534,159		575,970
Alternatives		151,277		3,298			(805	)		(2,616	)		151,154		150,957
Active subtotal		1,676,167		5,275			(137,770	)		(32,810	)		1,510,862		1,591,106
Index:
Equity		2,133,758		2,301			(287,363	)		(48,842	)		1,799,854		1,969,660
Fixed income		871,167		19,724			(73,665	)		(48,982	)		768,244		813,260
Multi-asset		9,143		(647	)		(937	)		(263	)		7,296		7,863
Alternatives		5,696		(170	)		(99	)		(218	)		5,209		5,600
Index subtotal		3,019,764		21,208			(362,064	)		(98,305	)		2,580,603		2,796,383
Institutional subtotal		4,695,931		26,483			(499,834	)		(131,115	)		4,091,465		4,387,489
Long-term		8,835,550		68,613			(1,000,519	)		(164,458	)		7,739,186		8,279,105
Cash management		724,939		21,218			(130	)		(6,570	)		739,457		734,270
Advisory ⁽³⁾		9,025		(258	)		-			-			8,767		8,903
Total	$	9,569,514	$	89,573		$	(1,000,649	)	$	(171,028	)	$	8,487,410	$	9,022,278
Current Quarter Component Changes by Investment Style and Product Type (Long-Term)
			Net
	March 31,		inflows			Market						June 30,
	2022		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Active:
Equity	$	472,849	$	(1,825	)	$	(69,076	)	$	(8,900	)	$	393,048	$	434,212
Fixed income		1,037,813		(15,139	)		(56,717	)		(12,000	)		953,957		993,668
Multi-asset		767,316		1,865			(89,273	)		(16,613	)		663,295		715,624
Alternatives		201,162		4,760			(2,486	)		(3,088	)		200,348		200,855
Active subtotal		2,479,140		(10,339	)		(217,552	)		(40,601	)		2,210,648		2,344,359
Index and ETFs:
ETFs:
Equity		2,350,421		23,328			(348,798	)		(14,608	)		2,010,343		2,178,149
Fixed income		712,767		30,739			(41,926	)		(5,692	)		695,888		702,485
Multi-asset		8,716		161			(942	)		(67	)		7,868		8,246
Alternatives		78,592		(2,125	)		(6,159	)		(111	)		70,197		75,187
ETFs subtotal		3,150,496		52,103			(397,825	)		(20,478	)		2,784,296		2,964,067
Non-ETF Index:
Equity		2,295,774		7,139			(308,637	)		(52,547	)		1,941,729		2,121,237
Fixed income		895,291		20,526			(75,468	)		(50,350	)		789,999		835,969
Multi-asset		9,150		(646	)		(938	)		(264	)		7,302		7,871
Alternatives		5,699		(170	)		(99	)		(218	)		5,212		5,602
Non-ETF Index subtotal		3,205,914		26,849			(385,142	)		(103,379	)		2,744,242		2,970,679
Index and ETFs subtotal		6,356,410		78,952			(782,967	)		(123,857	)		5,528,538		5,934,746
Long-term	$	8,835,550	$	68,613		$	(1,000,519	)	$	(164,458	)	$	7,739,186	$	8,279,105
Current Quarter Component Changes by Product Type (Long-Term)
			Net
	March 31,		inflows			Market						June 30,
	2022		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Equity	$	5,119,044	$	28,642		$	(726,511	)	$	(76,055	)	$	4,345,120	$	4,733,598
Fixed income		2,645,871		36,126			(174,111	)		(68,042	)		2,439,844		2,532,122
Multi-asset		785,182		1,380			(91,153	)		(16,944	)		678,465		731,741
Alternatives:
Illiquid alternatives		109,141		5,414			(682	)		(1,834	)		112,039		110,501
Liquid alternatives		87,326		(932	)		(1,518	)		(1,106	)		83,770		85,574
Currency and commodities⁽⁴⁾		88,986		(2,017	)		(6,544	)		(477	)		79,948		85,569
Alternatives subtotal		285,453		2,465			(8,744	)		(3,417	)		275,757		281,644
Long-term	$	8,835,550	$	68,613		$	(1,000,519	)	$	(164,458	)	$	7,739,186	$	8,279,105

⁽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						June 30,
	2021		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Retail:
Equity	$	471,937	$	5,329		$	(95,767	)	$	(10,273	)	$	371,226	$	426,530
Fixed income		365,306		(9,458	)		(37,149	)		(4,839	)		313,860		341,015
Multi-asset		155,461		(22	)		(25,078	)		(1,219	)		129,142		144,767
Alternatives		47,349		4,342			(1,879	)		(615	)		49,197		49,151
Retail subtotal		1,040,053		191			(159,873	)		(16,946	)		863,425		961,463
ETFs:
Equity		2,447,248		64,499			(484,632	)		(16,772	)		2,010,343		2,255,471
Fixed income		745,373		38,889			(81,054	)		(7,320	)		695,888		713,181
Multi-asset		9,119		231			(1,433	)		(49	)		7,868		8,466
Alternatives		65,614		4,693			14			(124	)		70,197		72,087
ETFs subtotal		3,267,354		108,312			(567,105	)		(24,265	)		2,784,296		3,049,205
Institutional:
Active:
Equity		199,980		5,716			(35,704	)		(6,295	)		163,697		183,162
Fixed income		767,402		(9,667	)		(83,354	)		(12,529	)		661,852		715,059
Multi-asset		642,951		18,997			(108,576	)		(19,213	)		534,159		598,329
Alternatives		146,384		6,627			1,285			(3,142	)		151,154		150,223
Active subtotal		1,756,717		21,673			(226,349	)		(41,179	)		1,510,862		1,646,773
Index:
Equity		2,223,195		29,122			(388,908	)		(63,555	)		1,799,854		2,036,631
Fixed income		943,960		23,885			(130,877	)		(68,724	)		768,244		861,222
Multi-asset		8,963		(154	)		(1,135	)		(378	)		7,296		8,173
Alternatives		5,534		(671	)		657			(311	)		5,209		5,540
Index subtotal		3,181,652		52,182			(520,263	)		(132,968	)		2,580,603		2,911,566
Institutional subtotal		4,938,369		73,855			(746,612	)		(174,147	)		4,091,465		4,558,339
Long-term		9,245,776		182,358			(1,473,590	)		(215,358	)		7,739,186		8,569,007
Cash management		755,057		(5,876	)		(759	)		(8,965	)		739,457		735,753
Advisory ⁽³⁾		9,310		(543	)		-			-			8,767		9,012
Total	$	10,010,143	$	175,939		$	(1,474,349	)	$	(224,323	)	$	8,487,410	$	9,313,772
Year-to-Date Component Changes by Investment Style and Product Type (Long-Term)
			Net
	December 31,		inflows			Market						June 30,
	2021		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Active:
Equity	$	507,103	$	172		$	(102,604	)	$	(11,623	)	$	393,048	$	454,645
Fixed income		1,107,085		(20,416	)		(117,195	)		(15,517	)		953,957		1,032,671
Multi-asset		798,404		18,974			(133,653	)		(20,430	)		663,295		743,088
Alternatives		193,733		10,969			(596	)		(3,758	)		200,348		199,373
Active subtotal		2,606,325		9,699			(354,048	)		(51,328	)		2,210,648		2,429,777
Index and ETFs:
ETFs:
Equity		2,447,248		64,499			(484,632	)		(16,772	)		2,010,343		2,255,471
Fixed income		745,373		38,889			(81,054	)		(7,320	)		695,888		713,181
Multi-asset		9,119		231			(1,433	)		(49	)		7,868		8,466
Alternatives		65,614		4,693			14			(124	)		70,197		72,087
ETFs subtotal		3,267,354		108,312			(567,105	)		(24,265	)		2,784,296		3,049,205
Non-ETF Index:
Equity		2,388,009		39,995			(417,775	)		(68,500	)		1,941,729		2,191,678
Fixed income		969,583		25,176			(134,185	)		(70,575	)		789,999		884,625
Multi-asset		8,971		(153	)		(1,136	)		(380	)		7,302		8,181
Alternatives		5,534		(671	)		659			(310	)		5,212		5,541
Non-ETF Index subtotal		3,372,097		64,347			(552,437	)		(139,765	)		2,744,242		3,090,025
Index and ETFs subtotal		6,639,451		172,659			(1,119,542	)		(164,030	)		5,528,538		6,139,230
Long-Term	$	9,245,776	$	182,358		$	(1,473,590	)	$	(215,358	)	$	7,739,186	$	8,569,007
Year-to-Date Component Changes by Product Type (Long-Term)
			Net
	December 31,		inflows			Market						June 30,
	2021		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Equity	$	5,342,360	$	104,666		$	(1,005,011	)	$	(96,895	)	$	4,345,120	$	4,901,794
Fixed income		2,822,041		43,649			(332,434	)		(93,412	)		2,439,844		2,630,477
Multi-asset		816,494		19,052			(136,222	)		(20,859	)		678,465		759,735
Alternatives:
Illiquid alternatives		102,579		9,286			2,525			(2,351	)		112,039		108,652
Liquid alternatives		87,348		976			(3,377	)		(1,177	)		83,770		86,251
Currency and commodities⁽⁴⁾		74,954		4,729			929			(664	)		79,948		82,098
Alternatives subtotal		264,881		14,991			77			(4,192	)		275,757		277,001
Long-Term	$	9,245,776	$	182,358		$	(1,473,590	)	$	(215,358	)	$	7,739,186	$	8,569,007

⁽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 seven 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
	June 30,		inflows			Market						June 30,
	2021		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Retail:
Equity	$	446,327	$	23,190		$	(84,740	)	$	(13,551	)	$	371,226	$	439,849
Fixed income		359,480		3,925			(42,563	)		(6,982	)		313,860		350,333
Multi-asset		147,228		7,683			(24,120	)		(1,649	)		129,142		147,910
Alternatives		42,448		9,588			(2,023	)		(816	)		49,197		46,930
Retail subtotal		995,483		44,386			(153,446	)		(22,998	)		863,425		985,022
ETFs:
Equity		2,257,828		169,555			(392,003	)		(25,037	)		2,010,343		2,279,120
Fixed income		700,009		94,433			(87,618	)		(10,936	)		695,888		714,420
Multi-asset		7,663		1,551			(1,265	)		(81	)		7,868		8,312
Alternatives		66,005		4,670			(311	)		(167	)		70,197		69,079
ETFs subtotal		3,031,505		270,209			(481,197	)		(36,221	)		2,784,296		3,070,931
Institutional:
Active:
Equity		184,174		15,311			(27,814	)		(7,974	)		163,697		184,401
Fixed income		716,671		43,210			(80,946	)		(17,083	)		661,852		720,305
Multi-asset		584,582		58,347			(81,391	)		(27,379	)		534,159		603,840
Alternatives		138,622		13,870			2,652			(3,990	)		151,154		146,260
Active subtotal		1,624,049		130,738			(187,499	)		(56,426	)		1,510,862		1,654,806
Index:
Equity		2,146,062		(25,116	)		(239,291	)		(81,801	)		1,799,854		2,096,323
Fixed income		936,005		30,288			(111,182	)		(86,867	)		768,244		902,546
Multi-asset		9,297		(587	)		(925	)		(489	)		7,296		9,074
Alternatives		5,709		(1,036	)		906			(370	)		5,209		5,604
Index subtotal		3,097,073		3,549			(350,492	)		(169,527	)		2,580,603		3,013,547
Institutional subtotal		4,721,122		134,287			(537,991	)		(225,953	)		4,091,465		4,668,353
Long-term		8,748,110		448,882			(1,172,634	)		(285,172	)		7,739,186		8,724,306
Cash management		727,603		25,638			(1,687	)		(12,097	)		739,457		729,454
Advisory ⁽³⁾		20,280		(11,530	)		18			(1	)		8,767		10,566
Total	$	9,495,993	$	462,990		$	(1,174,303	)	$	(297,270	)	$	8,487,410	$	9,464,326
Year-over-Year Component Changes by Investment Style and Product Type (Long-Term)
			Net
	June 30,		inflows			Market						June 30,
	2021		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Active:
Equity	$	479,240	$	23,744		$	(94,518	)	$	(15,418	)	$	393,048	$	468,953
Fixed income		1,054,517		41,507			(120,201	)		(21,866	)		953,957		1,047,608
Multi-asset		731,806		66,025			(105,509	)		(29,027	)		663,295		751,743
Alternatives		181,069		23,458			627			(4,806	)		200,348		193,189
Active subtotal		2,446,632		154,734			(319,601	)		(71,117	)		2,210,648		2,461,493
Index and ETFs:
ETFs:
Equity		2,257,828		169,555			(392,003	)		(25,037	)		2,010,343		2,279,120
Fixed income		700,009		94,433			(87,618	)		(10,936	)		695,888		714,420
Multi-asset		7,663		1,551			(1,265	)		(81	)		7,868		8,312
Alternatives		66,005		4,670			(311	)		(167	)		70,197		69,079
ETFs subtotal		3,031,505		270,209			(481,197	)		(36,221	)		2,784,296		3,070,931
Non-ETF Index:
Equity		2,297,323		(10,359	)		(257,327	)		(87,908	)		1,941,729		2,251,620
Fixed income		957,639		35,916			(114,490	)		(89,066	)		789,999		925,576
Multi-asset		9,301		(582	)		(927	)		(490	)		7,302		9,081
Alternatives		5,710		(1,036	)		908			(370	)		5,212		5,605
Non-ETF Index subtotal		3,269,973		23,939			(371,836	)		(177,834	)		2,744,242		3,191,882
Index and ETFs subtotal		6,301,478		294,148			(853,033	)		(214,055	)		5,528,538		6,262,813
Long-term	$	8,748,110	$	448,882		$	(1,172,634	)	$	(285,172	)	$	7,739,186	$	8,724,306
Year-over-Year Component Changes by Product Type (Long-Term)
			Net
	June 30,		inflows			Market						June 30,
	2021		(outflows)			change			FX impact⁽¹⁾			2022		Average AUM ⁽²⁾
Equity	$	5,034,391	$	182,940		$	(743,848	)	$	(128,363	)	$	4,345,120	$	4,999,693
Fixed income		2,712,165		171,856			(322,309	)		(121,868	)		2,439,844		2,687,604
Multi-asset		748,770		66,994			(107,701	)		(29,598	)		678,465		769,136
Alternatives:
Illiquid alternatives		95,961		15,835			3,322			(3,079	)		112,039		103,771
Liquid alternatives		81,560		6,629			(2,983	)		(1,436	)		83,770		85,311
Currency and commodities⁽⁴⁾		75,263		4,628			885			(828	)		79,948		78,791
Alternatives subtotal		252,784		27,092			1,224			(5,343	)		275,757		267,873
Long-term	$	8,748,110	$	448,882		$	(1,172,634	)	$	(285,172	)	$	7,739,186	$	8,724,306

⁽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					Six Months
	Ended							Ended					Ended
	June 30,							March 31,					June 30,
(in millions), (unaudited)	2022		2021		Change			2022		Change			2022		2021		Change
Investment advisory, administration fees and securities lending revenue:
Equity:
Active	$	550	$	641	$	(91	)	$	616	$	(66	)	$	1,166	$	1,217	$	(51	)
ETFs		1,103		1,156		(53	)		1,158		(55	)		2,261		2,224		37
Non-ETF Index		186		198		(12	)		187		(1	)		373		374		(1	)
Equity subtotal		1,839		1,995		(156	)		1,961		(122	)		3,800		3,815		(15	)
Fixed income:
Active		503		545		(42	)		534		(31	)		1,037		1,070		(33	)
ETFs		274		294		(20	)		289		(15	)		563		589		(26	)
Non-ETF Index		102		116		(14	)		118		(16	)		220		229		(9	)
Fixed income subtotal		879		955		(76	)		941		(62	)		1,820		1,888		(68	)
Multi-asset		331		344		(13	)		359		(28	)		690		672		18
Alternatives:
Illiquid alternatives		184		167		17			179		5			363		335		28
Liquid alternatives		161		150		11			167		(6	)		328		297		31
Currency and commodities		62		55		7			56		6			118		108		10
Alternatives subtotal		407		372		35			402		5			809		740		69
Long-term		3,456		3,666		(210	)		3,663		(207	)		7,119		7,115		4
Cash management		232		91		141			170		62			402		234		168
Total investment advisory, administration fees and securities lending revenue		3,688		3,757		(69	)		3,833		(145	)		7,521		7,349		172
Investment advisory performance fees:
Equity		3		36		(33	)		12		(9	)		15		62		(47	)
Fixed income		13		15		(2	)		9		4			22		29		(7	)
Multi-asset		7		9		(2	)		5		2			12		17		(5	)
Alternatives:
Illiquid alternatives		65		90		(25	)		37		28			102		97		5
Liquid alternatives		18		190		(172	)		35		(17	)		53		264		(211	)
Alternatives subtotal		83		280		(197	)		72		11			155		361		(206	)
Total performance fees		106		340		(234	)		98		8			204		469		(265	)
Technology services revenue		332		316		16			341		(9	)		673		622		51
Distribution fees:
Retrocessions		269		264		5			279		(10	)		548		502		46
12b-1 fees (US mutual fund distribution fees)		80		87		(7	)		88		(8	)		168		172		(4	)
Other		12		18		(6	)		14		(2	)		26		35		(9	)
Total distribution fees		361		369		(8	)		381		(20	)		742		709		33
Advisory and other revenue:
Advisory		15		9		6			16		(1	)		31		24		7
Other		24		29		(5	)		30		(6	)		54		45		9
Total advisory and other revenue		39		38		1			46		(7	)		85		69		16
Total revenue	$	4,526	$	4,820	$	(294	)	$	4,699	$	(173	)	$	9,225	$	9,218	$	7

Highlights

•

Investment advisory, administration fees and securities lending revenue decreased $69 million from the second 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, the elimination of yield-related fee waivers on money market funds, and higher securities lending revenue. Securities lending revenue of $160 million increased from $140 million in the second quarter of 2021, primarily reflecting higher spreads.

Investment advisory, administration fees and securities lending revenue decreased $145 million from the first quarter of 2022, primarily driven by the negative impact of market beta and foreign exchange movements on average AUM, partially offset by the elimination of yield-related fee waivers on money market funds, the effect of one additional day in the quarter, and higher securities lending revenue. Securities lending revenue of $160 million increased from $138 million in the first quarter of 2022, primarily reflecting higher spreads.

•	Performance fees decreased $234 million from the second quarter of 2021, primarily reflecting lower revenue from alternative and long-only products.

•

Technology services revenue increased $16 million from the second 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 10% from the second 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						Six Months
	Ended								Ended						Ended
	June 30,								March 31,						June 30,
(in millions), (unaudited)	2022		2021			Change			2022			Change			2022			2021		Change
Operating expense
Employee compensation and benefits	$	1,414	$	1,548		$	(134	)	$	1,498		$	(84	)	$	2,912		$	2,957	$	(45	)
Distribution and servicing costs:
Retrocessions		269		264			5			279			(10	)		548			502		46
12b-1 costs		78		85			(7	)		86			(8	)		164			168		(4	)
Other		225		174			51			209			16			434			358		76
Total distribution and servicing costs		572		523			49			574			(2	)		1,146			1,028		118
Direct fund expense		304		320			(16	)		329			(25	)		633			640		(7	)
General and administration expense:
Marketing and promotional		76		53			23			60			16			136			88		48
Occupancy and office related		106		80			26			99			7			205			159		46
Portfolio services		67		64			3			69			(2	)		136			129		7
Sub-advisory		20		23			(3	)		22			(2	)		42			45		(3	)
Technology		148		129			19			145			3			293			233		60
Professional services		42		41			1			40			2			82			80		2
Communications		10		11			(1	)		11			(1	)		21			22		(1	)
Foreign exchange remeasurement		2		(2	)		4			(3	)		5			(1	)		2		(3	)
Contingent consideration fair value adjustments		-		1			(1	)		1			(1	)		1			4		(3	)
Product launch costs		-		-			-			-			-			-			178		(178	)
Other general and administration		59		61			(2	)		52			7			111			106		5
Total general and administration expense		530		461			69			496			34			1,026			1,046		(20	)
Amortization of intangible assets		38		37			1			38			-			76			71		5
Total operating expense	$	2,858	$	2,889		$	(31	)	$	2,935		$	(77	)	$	5,793		$	5,742	$	51

Highlights

•

Employee compensation and benefits expense decreased $134 million from the second quarter of 2021, primarily reflecting lower incentive compensation, due to lower operating income and performance fees, and lower deferred compensation driven in part by the lower mark-to-market impact of certain deferred cash compensation programs, partially offset by higher base compensation.

Employee compensation and benefits expense decreased $84 million from the first quarter of 2022, primarily reflecting lower incentive compensation and lower seasonal payroll taxes in the current quarter.

•	Direct fund expense decreased $25 million from the first quarter of 2022, primarily reflecting lower average AUM.

•

General and administration expense increased $69 million from the second quarter of 2021, primarily driven by higher marketing and promotional expense, resulting from higher travel and entertainment expense, and higher technology expense. The increase also reflected higher occupancy and office related expense, including $15 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) and (2) to the condensed consolidated statements of income and supplemental information for more information on as adjusted items.

General and administration expense increased $34 million from the first quarter of 2022, primarily reflecting higher marketing and promotional expense, resulting from higher travel and entertainment expense.

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

	Three Months									Three Months						Six Months
	Ended									Ended						Ended
	June 30,									March 31,						June 30,
(in millions), (unaudited)	2022			2021			Change			2022			Change			2022			2021			Change
Nonoperating income (expense), GAAP basis	$	(347	)	$	270		$	(617	)	$	(138	)	$	(209	)	$	(485	)	$	316		$	(801	)
Less: Net income (loss) attributable to noncontrolling interests ("NCI")		(114	)		169			(283	)		(73	)		(41	)		(187	)		243			(430	)
Nonoperating income (expense)⁽¹⁾	$	(233	)	$	101		$	(334	)	$	(65	)	$	(168	)	$	(298	)	$	73		$	(371	)

	Three Months									Three Months						Six Months
	Ended									Ended						Ended
	June 30,									March 31,						June 30,
(in millions), (unaudited)	2022			2021			Change			2022			Change			2022			2021			Change
Net gain (loss) on investments⁽¹⁾
Private equity	$	(8	)	$	66		$	(74	)	$	10		$	(18	)	$	2		$	88		$	(86	)
Real assets		1			3			(2	)		13			(12	)		14			6			8
Other alternatives⁽²⁾		(5	)		17			(22	)		4			(9	)		(1	)		30			(31	)
Other investments⁽³⁾		(112	)		48			(160	)		(75	)		(37	)		(187	)		45			(232	)
Subtotal		(124	)		134			(258	)		(48	)		(76	)		(172	)		169			(341	)
Other gains (losses)⁽⁴⁾		(76	)		11			(87	)		19			(95	)		(57	)		(16	)		(41	)
Total net gain (loss) on investments⁽¹⁾		(200	)		145			(345	)		(29	)		(171	)		(229	)		153			(382	)
Interest and dividend income		21			8			13			18			3			39			27			12
Interest expense		(54	)		(52	)		(2	)		(54	)		-			(108	)		(107	)		(1	)
Net interest expense		(33	)		(44	)		11			(36	)		3			(69	)		(80	)		11
Nonoperating income (expense)⁽¹⁾	$	(233	)	$	101		$	(334	)	$	(65	)	$	(168	)	$	(298	)	$	73		$	(371	)

⁽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⁾	Amounts primarily include noncash pre-tax gains (losses) related to the revaluation of certain minority investments.

INCOME TAX EXPENSE

	Three Months									Three Months							Six Months
	Ended									Ended							Ended
	June 30,									March 31,							June 30,
(in millions), (unaudited)	2022			2021			Change			2022				Change			2022			2021			Change
Income tax expense	$	358		$	654		$	(296	)		$	263		$	95		$	621		$	972		$	(351	)
Effective tax rate		24.9	%		32.2	%		(730	) bps			15.5	%		940	bps		19.8	%		27.4	%		(760	) bps

Highlights

•	Second quarter 2021 income tax expense included $171 million of noncash net expense related to the revaluation of certain deferred tax assets and liabilities as a result of legislation enacted in the United Kingdom increasing its corporate tax rate.

•	First quarter 2022 income tax expense included $133 million of discrete tax benefits related to stock-based compensation awards that vested in the first quarter and 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									Six Months Ended
	June 30,						March 31,			June 30,
(in millions), (unaudited)	2022			2021			2022			2022			2021
Operating income, GAAP basis	$	1,668		$	1,931		$	1,764		$	3,432		$	3,476
Non-GAAP expense adjustments:
Amortization of intangible assets		38			37			38			76			71
Acquisition-related compensation costs		6			47			7			13			64
Contingent consideration fair value adjustments		-			1			1			1			4
Lease cost - Hudson Yards		15			-			12			27			-
Operating income, as adjusted (1)		1,727			2,016			1,822			3,549			3,615
Product launch costs and commissions		-			-			-			-			185
Operating income used for operating margin measurement	$	1,727		$	2,016		$	1,822		$	3,549		$	3,800
Revenue, GAAP basis	$	4,526		$	4,820		$	4,699		$	9,225		$	9,218
Non-GAAP adjustments:
Distribution fees		(361	)		(369	)		(381	)		(742	)		(709	)
Investment advisory fees		(211	)		(154	)		(193	)		(404	)		(319	)
Revenue used for operating margin measurement	$	3,954		$	4,297		$	4,125		$	8,079		$	8,190
Operating margin, GAAP basis		36.9	%		40.1	%		37.5	%		37.2	%		37.7	%
Operating margin, as adjusted (1)		43.7	%		46.9	%		44.2	%		43.9	%		46.4	%

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							Six Months Ended
	June 30,				March 31,			June 30,
(in millions, except per share data), (unaudited)	2022		2021		2022			2022			2021
Net income attributable to BlackRock, Inc., GAAP basis	$	1,077	$	1,378	$	1,436		$	2,513		$	2,577
Non-GAAP adjustments:
Amortization of intangible assets, net of tax		29		28		29			58		54
Acquisition-related compensation costs, net of tax		5		36		5			10		49
Contingent consideration fair value adjustments, net of tax		-		1		1			1		3
Lease cost - Hudson Yards, net of tax		11		-		9			20			-
Income tax matters		-		171		(18	)		(18	)		171
Net income attributable to BlackRock, Inc., as adjusted (2)	$	1,122	$	1,614	$	1,462		$	2,584		$	2,854
Diluted weighted-average common shares outstanding		152.5		154.4		153.5			153.0			154.4
Diluted earnings per common share, GAAP basis	$	7.06	$	8.92	$	9.35		$	16.43		$	16.69
Diluted earnings per common share, as adjusted (2)	$	7.36	$	10.45	$	9.52		$	16.89		$	18.49

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 June 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 May 31, 2022. The performance data does not include accounts terminated prior to June 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 June 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.