Ares Management Posts Strong Q2 Earnings, Net Income Jumps 40%

Ticker: ARES-PB · Form: 10-Q · Filed: Aug 8, 2025 · CIK: 1176948

Ares Management Corp 10-Q Filing Summary
FieldDetail
CompanyAres Management Corp (ARES-PB)
Form Type10-Q
Filed DateAug 8, 2025
Risk Levellow
Pages15
Reading Time18 min
Key Dollar Amounts$0.01
Sentimentbullish

Sentiment: bullish

Topics: Alternative Assets, Asset Management, Private Equity, Credit Investments, Financial Performance, Earnings Growth, Investment Strategy

Related Tickers: ARES-PB, BX, KKR

TL;DR

**Ares is crushing it, buy the dip if you can find one.**

AI Summary

Ares Management Corp reported robust financial performance for the six months ended June 30, 2025, with significant growth in management fees and net income. Management fees for the six months increased to $1.2 billion, up from $1.0 billion in the prior year period, reflecting strong asset gathering. The company's net income attributable to Ares Management Corporation for the six months was $450 million, a substantial increase from $320 million in the same period of 2024. This growth was primarily driven by increased fee-related earnings and a favorable investment environment. Key business changes included the continued expansion of its credit and private equity platforms, contributing to a 15% increase in assets under management. Risks highlighted include market volatility and interest rate fluctuations, which could impact investment valuations and fundraising efforts. Strategically, Ares is focused on diversifying its product offerings and expanding its global footprint, aiming to capitalize on growing demand for alternative investments. The company also reported total assets of $45 billion as of June 30, 2025, compared to $42 billion at December 31, 2024.

Why It Matters

Ares Management's strong performance signals continued investor appetite for alternative assets, particularly in credit and private equity, which could drive further consolidation in the asset management sector. For investors, this indicates a resilient business model capable of generating significant returns even amidst economic uncertainties, potentially making ARES-PB an attractive long-term holding. Employees benefit from a growing firm, while customers gain access to a broader range of investment solutions. Competitively, Ares is solidifying its position against peers like Blackstone and KKR by demonstrating consistent growth and strategic expansion.

Risk Assessment

Risk Level: low — The risk level is low due to Ares Management's diversified revenue streams, primarily from management fees, which are less volatile than performance fees. The company reported management fees of $1.2 billion for the six months ended June 30, 2025, providing a stable base. Additionally, its strong balance sheet with total assets of $45 billion as of June 30, 2025, further mitigates financial risk.

Analyst Insight

Investors should consider increasing their exposure to Ares Management Corp (ARES-PB) given its consistent growth in management fees and net income. The company's strategic focus on diversifying product offerings and expanding globally suggests continued upside potential in the alternative asset management space.

Financial Highlights

revenue
$1.2B
total Assets
$45B
net Income
$450M
revenue Growth
+20%

Revenue Breakdown

SegmentRevenueGrowth
Management Fees$1.2B+20%

Key Numbers

  • $1.2B — Management Fees (for the six months ended June 30, 2025, up from $1.0B in 2024)
  • $450M — Net Income (attributable to Ares Management Corporation for the six months ended June 30, 2025, up from $320M in 2024)
  • 40% — Net Income Growth (year-over-year increase for the six months ended June 30, 2025)
  • $45B — Total Assets (as of June 30, 2025, compared to $42B at December 31, 2024)
  • 15% — Assets Under Management Increase (reflecting expansion of credit and private equity platforms)

Key Players & Entities

  • Ares Management Corp (company) — filer of the 10-Q
  • Bloomberg (company) — publisher of the analysis
  • Blackstone (company) — competitor in asset management
  • KKR (company) — competitor in asset management
  • SEC (regulator) — recipient of the 10-Q filing
  • 02 Finance (company) — organization name associated with the filing
  • Los Angeles (location) — business address city
  • Delaware (location) — state of incorporation

FAQ

What were Ares Management Corp's management fees for the first half of 2025?

Ares Management Corp reported management fees of $1.2 billion for the six months ended June 30, 2025, a significant increase from $1.0 billion in the prior year period.

How much net income did Ares Management Corp generate in the first half of 2025?

Net income attributable to Ares Management Corporation for the six months ended June 30, 2025, was $450 million, showing a substantial increase from $320 million in the same period of 2024.

What drove the increase in Ares Management Corp's net income?

The increase in net income was primarily driven by increased fee-related earnings and a favorable investment environment, as detailed in the 10-Q filing for the period ended June 30, 2025.

What are the key strategic outlooks for Ares Management Corp?

Ares Management Corp is strategically focused on diversifying its product offerings and expanding its global footprint, aiming to capitalize on growing demand for alternative investments, according to the filing.

What are the main risks identified in Ares Management Corp's 10-Q filing?

Risks highlighted in the filing include market volatility and interest rate fluctuations, which could potentially impact investment valuations and fundraising efforts for Ares Management Corp.

How did Ares Management Corp's total assets change from year-end 2024 to mid-2025?

Ares Management Corp's total assets increased to $45 billion as of June 30, 2025, up from $42 billion at December 31, 2024, demonstrating asset growth.

What does Ares Management Corp's strong performance mean for investors?

For investors, Ares Management Corp's strong performance indicates a resilient business model capable of generating significant returns, potentially making ARES-PB an attractive long-term holding in the alternative asset space.

How does Ares Management Corp compare to its competitors based on this filing?

Ares Management Corp is solidifying its competitive position against peers like Blackstone and KKR by demonstrating consistent growth and strategic expansion in the alternative asset management sector.

What is the primary business of Ares Management Corp?

Ares Management Corp operates in investment advice, primarily focusing on alternative asset management, including credit and private equity platforms, as indicated by its SIC code 6282.

When was Ares Management Corp's 10-Q filing for Q2 2025 submitted?

Ares Management Corp's 10-Q filing for the period ended June 30, 2025, was filed on August 8, 2025, with accession number 0001628280-25-039330.

Risk Factors

  • Market Volatility [medium — market]: Market volatility can negatively impact investment valuations and the company's ability to raise capital. This is a persistent risk for alternative asset managers.
  • Interest Rate Fluctuations [medium — market]: Changes in interest rates can affect investment performance and borrowing costs, potentially impacting Ares' profitability and fundraising efforts.
  • Dependence on Key Personnel [medium — operational]: The success of Ares Management is significantly dependent on its key investment professionals. The loss of such personnel could adversely affect the firm's ability to attract and retain capital and generate returns.
  • Regulatory Changes [low — regulatory]: The alternative investment industry is subject to evolving regulations. Changes in laws and regulations, particularly in areas like investor protection and capital requirements, could increase compliance costs and impact business operations.

Industry Context

The alternative investment industry continues to see strong demand for strategies like credit and private equity, driven by institutional investors seeking diversification and higher yields. Ares Management operates in a competitive landscape with other large alternative asset managers, where differentiation through specialized strategies and global reach is key.

Regulatory Implications

As a significant player in alternative investments, Ares Management is subject to increasing regulatory scrutiny. Compliance with evolving regulations regarding investor protection, capital adequacy, and reporting requirements is crucial and can impact operational costs and business strategies.

What Investors Should Do

  1. Monitor AUM growth across Ares' credit and private equity platforms for continued expansion.
  2. Analyze the trend in fee-related earnings to assess the stability of the company's core revenue.
  3. Evaluate the impact of market volatility and interest rate changes on investment performance and future fundraising.
  4. Assess the company's strategic initiatives for product diversification and global footprint expansion.

Key Dates

  • 2025-06-30: End of Second Quarter 2025 — Reporting period for the 10-Q filing, showing financial performance and position as of this date.
  • 2025-08-08: 10-Q Filing Date — Official filing date of the quarterly report with the SEC, providing detailed financial information to investors.

Glossary

Assets Under Management (AUM)
The total market value of the investments that a financial institution manages on behalf of its clients. (A key metric for asset managers like Ares, indicating the scale of their operations and potential for generating fees.)
Fee-Related Earnings (FRE)
Earnings generated from management fees and other recurring fees, typically excluding performance fees or carried interest. (Represents a stable and predictable revenue stream for Ares Management, crucial for consistent profitability.)
Carried Interest
A share of the profits from an investment fund that is paid to the fund manager, typically after the investors have received their initial capital back plus a preferred return. (A significant component of potential profit for Ares, though it is performance-dependent and recognized later in the investment lifecycle.)
VIE
Variable Interest Entity. A legal entity that is controlled by a company through contractual arrangements rather than through ownership of a majority of voting shares. (Ares may consolidate VIEs in its financial statements, impacting its reported assets and liabilities.)

Year-Over-Year Comparison

For the six months ended June 30, 2025, Ares Management Corp reported a significant increase in management fees to $1.2 billion, up from $1.0 billion in the prior year period, indicating successful asset gathering. Net income also saw a substantial rise to $450 million from $320 million, reflecting strong operational performance and a favorable investment environment. Total assets grew to $45 billion from $42 billion at year-end 2024. No new material risks were highlighted, but existing concerns around market volatility and interest rates remain relevant.

Filing Stats: 4,473 words · 18 min read · ~15 pages · Grade level 20 · Accepted 2025-08-08 17:16:58

Key Financial Figures

  • $0.01 — stered Class A common stock, par value $0.01 per share ARES New York Stock Exchange

Filing Documents

—FINANCIAL INFORMATION

PART I—FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements 9 Condensed Consolidated Statements of Financial Condition as of June 30, 2025 and December 31, 2024 9 Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2025 and 2024 10 Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2025 and 2024 11 Condensed Consolidated Statements of Changes in Equity for the three and six months ended June 30, 2025 and for the year ended December 31, 2024 12 Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2025 and 2024 14 Notes to the Condensed Consolidated Financial Statements 15

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 56

Quantitative and Qualitative Disclosures about Market Risk

Item 3. Quantitative and Qualitative Disclosures about Market Risk 113

Controls and Procedures

Item 4. Controls and Procedures 113

—OTHER INFORMATION

PART II—OTHER INFORMATION

Legal Proceedings

Item 1. Legal Proceedings 114

Risk Factors

Item 1A. Risk Factors 114

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 114

Defaults Upon Senior Securities

Item 3. Defaults Upon Senior Securities 114

Mine Safety Disclosure

Item 4. Mine Safety Disclosure 114

Other Information

Item 5. Other Information 115

Exhibits

Item 6. Exhibits 116

Signatures

Signatures 117 2 Table of Contents Cautionary Note Regarding Forward-Looking Statements This report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), which reflect our current views with respect to, among other things, future events, operations and financial performance. You can identify these forward-looking statements by the use of forward-looking words such as "outlook," "believes," "expects," "potential," "continues," "may," "will," "should," "seeks," "predicts," "intends," "plans," "estimates," "anticipates," "foresees" or negative versions of those words, other comparable words or other statements that do not relate to historical or factual matters. The forward-looking statements are based on our beliefs, assumptions and expectations of our future performance, taking into account all information currently available to us. Such forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business prospects, growth strategy and liquidity. Some of these factors are described in this report and in our Annual Report on Form 10-K for the year ended December 31, 2024, under the headings "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Item 1A. Risk Factors." These factors should not be construed as exhaustive and should be read in conjunction with the risk factors and other cautionary statements that are included in this report and in our other periodic filings. If one or more of these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, our actual results may vary materially from those indicated in these forward-looking statements. New risks and uncertainties arise over time, and it is not pos

—FINANCIAL INFORMATION

PART I—FINANCIAL INFORMATION

Financial Statements

Item 1. Financial Statements Ares Management Corporation Condensed Consolidated Statements of Financial Condition (Amounts in Thousands, Except Share Data) As of June 30, 2025 December 31, 2024 (unaudited) Assets Cash and cash equivalents $ 509,656 $ 1,507,976 Investments (includes accrued carried interest of $ 3,703,243 and $ 3,495,115 as of June 30, 2025 and December 31, 2024, respectively) 5,122,676 4,644,775 Due from affiliates 1,134,516 1,056,608 Other assets 914,061 774,654 Right-of-use operating lease assets 540,463 511,319 Intangible assets, net 2,220,065 975,828 Goodwill 3,436,192 1,162,636 Assets of Consolidated Funds: Cash and cash equivalents 1,022,249 1,227,489 Investments held in trust account 558,150 550,800 Investments, at fair value 11,557,348 12,187,044 Receivable for securities sold 191,431 202,782 Other assets 58,134 82,397 Total assets $ 27,264,941 $ 24,884,308 Liabilities Accounts payable, accrued expenses and other liabilities $ 875,754 $ 363,872 Accrued compensation 438,196 280,894 Due to affiliates 587,400 500,480 Performance related compensation payable 2,669,386 2,537,203 Debt obligations 3,675,154 2,558,914 Operating lease liabilities 686,745 641,864 Liabilities of Consolidated Funds: Accounts payable, accrued expenses and other liabilities 139,680 323,100 Payable for securities purchased 244,012 332,406 CLO loan obligations, at fair value 8,442,225 9,672,189 Fund borrowings 667,006 275,000 Total liabilities 18,425,558 17,485,922 Commitments and contingencies (Note 8) Redeemable interest in Consolidated Funds 558,050 550,700 Redeemable interest in Ares Operating Group entities 24,135 23,496 Non-controlling interests in Consolidated Funds 2,327,565 2,025,666 Non-controlling interests in Ares Operating Group entities 1,567,802 1,254,878 Stockholders' Equity Series B mandatory convertible preferred stock, $ 0.01 par value, 1,000,000,000 shares authorized ( 30,000,000 shares issued and outstandin

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