Apollo Global Management, Inc. Quarterly Report for Q3 Ended Sep 30, 2023

Summary

Apollo Global Management, Inc. (APO) reported strong financial performance for the nine months ended September 30, 2023, driven by significant growth in its Asset Management and Retirement Services segments. Total revenues increased substantially to $21.6 billion, a jump from $6.1 billion in the prior year period, largely due to a significant increase in net investment income within the Retirement Services segment, which benefited from higher interest rates and portfolio growth. The Asset Management segment also saw robust revenue growth, with management fees and advisory/transaction fees showing considerable increases, reflecting higher Assets Under Management (AUM). Fee Related Earnings (FRE) for Asset Management grew by 29% year-over-year, highlighting the company's ability to generate consistent, fee-based income. From a profitability perspective, Apollo generated net income attributable to common stockholders of $2.3 billion for the first nine months of 2023, a significant improvement from a net loss of $2.6 billion in the same period last year. This turnaround was bolstered by strong investment income and a substantial reduction in investment-related losses within the Retirement Services segment. The company maintained a strong liquidity position, with ample cash and available funds from credit facilities to support ongoing operations and strategic initiatives. Overall, the report indicates a period of substantial growth and improved profitability for Apollo Global Management, driven by strong performance across its core business segments.

Key Highlights

• 1Total Revenues surged to $21.6 billion for the nine months ended September 30, 2023, up from $6.1 billion in the prior year period, largely driven by the Retirement Services segment's net investment income and a significant improvement in investment-related gains (losses).
• 2Net Income Attributable to Apollo Global Management, Inc. common stockholders reached $2.3 billion for the nine months ended September 30, 2023, a significant turnaround from a net loss of $2.6 billion in the comparable prior year period.
• 3Fee Related Earnings (FRE) for the Asset Management segment increased by 29% year-over-year to $1.31 billion for the nine months ended September 30, 2023, reflecting strong fee generation from growing Assets Under Management (AUM).
• 4Spread Related Earnings (SRE) for the Retirement Services segment increased by 33% year-over-year to $2.36 billion for the nine months ended September 30, 2023, driven by higher net investment earnings and strategic capital management fees, despite increased cost of funds.
• 5Total Assets under management (AUM) across all segments grew to $631.2 billion as of September 30, 2023, up from $523.3 billion as of September 30, 2022, indicating successful capital raising and investment deployment.
• 6The company reported $12.3 billion in unrestricted cash and cash equivalents as of September 30, 2023, underscoring a healthy liquidity position to support operations and strategic growth.
• 7Mandatory Convertible Preferred Stock issuance of $1.4 billion on August 11, 2023, strengthens the company's capital structure and provides flexibility for future initiatives.

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