(Bloomberg) -- Blackstone Inc., the world’s largest alternative asset manager, signaled that profits from selling deals will remain subdued this quarter.
The firm disclosed two preliminary profit measures tied to realizations from the start of the third quarter through Tuesday. It generated about $225 million of realized performance revenue and roughly $45 million of realized principal investment income, according to a statement.
It’s the first time Blackstone has reported the figures. In last year’s third quarter, the firm generated $337.9 million of realized performance revenue and $55.5 million of principal investment income.
While the numbers aren’t comparable, they reaffirm broader concerns across Wall Street that alternative asset managers and real estate firms will struggle to capture high-octane returns from deal exits in coming months.
Even as the Federal Reserve has promised some reprieve with its latest rate cut, the industry is still sitting on a heap of assets purchased during a lower-rate era that many buyout firms and property investors can’t sell at the prices they expected.
Blackstone shares fell 2.3% to $153.92 at 11:51 a.m. in New York, paring their gain this year to 18%.
Chief Financial Officer Michael Chae said in a recent conference that it will take time for exits to rebound.
“We expect a near-term lag between markets improving and pickup in realizations,” he said. “And this remains our expectation for the third quarter.”
The firm sees 2025 as “potentially much more robust,” he added.
©2024 Bloomberg L.P.
