Erosion

16 January 2019 By Tom Buerkle

Larry Fink’s manager of $6 trln of assets saw revenue and profit fall in the last quarter from a year earlier. December’s stock rout predictably hit fees, but the shift to cheap ETFs from actively managed funds also accelerated. That’s likely to continue even if markets recover.

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BlackRock on Jan. 16 reported earnings attributable to the company of $927 million for the fourth quarter of 2018, or $5.78 per diluted share. Adjusted for non-operating items and one-off tax effects, earnings were $975 million for the period, or $6.08 a share, compared with $1 billion or $6.19 a share in the same period a year earlier. The mean forecast of analysts surveyed by Refinitiv’s I/B/E/S was for adjusted earnings of $6.27 a share. Revenue was $3.4 billion in the latest quarter, down from $3.8 billion a year earlier. Analysts had forecast revenue to be unchanged.

Assets under management were $6 trillion at the end of the quarter, down 5 percent from a year earlier.

(This item has been corrected above to refer to assets under management of $6 trillion not $6 billion.)

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