01—Abstract
Summary
Summary of the 10-Q filed May 7, 2025. Cited figures are marked; the original filing is the authoritative source.
Apollo Global Management, Inc. (APO) reported its first quarter 2025 results, showcasing continued growth across its diversified business segments.
Total revenues for the quarter were $5.55 billiona, a decrease from the prior year's $7.04 billion, primarily due to a significant decline in investment-related gains (losses) in the Retirement Services segment, which swung from a gain of $1.68 billion to a loss of $828 million. Despite this, the Asset Management segment demonstrated resilience with revenues growing slightly to $1.05 billion, driven by higher management and advisory fees. The Retirement Services segment reported an increase in net investment income, reflecting growth in Athene's investment portfolio and higher interest rates.
Net income attributable to Apollo Global Management, Inc. common stockholders decreased year-over-year to $418 millionb ($0.68 per diluted share) from $1.40 billion ($2.28 per diluted share) in Q1 2024. This decline was largely influenced by the aforementioned investment-related losses in the Retirement Services segment and higher operating expenses, particularly in compensation and benefits.
However, Fee Related Earnings (FRE) from the Asset Management segment increased by 21.0% to $559 millionc, indicating strong fee-generating revenue growth and operational efficiency. The company's total AUM also saw robust growth, reaching $785.2 billion as of March 31, 2025, up from $751.0 billion at the end of 2024, signaling continued investor confidence and successful capital deployment.
02—Key points
Key Highlights
- Total Revenues decreased by 21.2% to $5.55 billion, primarily due to a significant decrease in Investment Related Gains (Losses) in the Retirement Services segment.
- Net Income Attributable to Apollo Global Management, Inc. common stockholders decreased by 70.2% to $418 million ($0.68 per diluted share) from $1.40 billion ($2.28 per diluted share) in the prior year period.
- Fee Related Earnings (FRE) from the Asset Management segment increased by 21.0% to $559 million, driven by higher management fees and capital solutions fees.
- Total Assets Under Management (AUM) grew by 4.5% to $785.2 billion as of March 31, 2025, reflecting strong net flows and market activity across credit and equity strategies.
- The Retirement Services segment saw a significant decrease in Interest Sensitive Contract Benefits, mainly due to favorable changes in FIA embedded derivatives, while Net Investment Income increased by 18.7% due to portfolio growth and higher yields.
- Equity-based compensation expense decreased by 21.6% to $138 million, primarily due to a reduction in amortization of certain RSUs.
- The company reported a significant increase in its Principal Investing Income (PII), which grew to $14 million from $21 million due to higher realized performance fees, though this segment's income remains volatile.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2025filed May 7, 2025Financial Statements
Q1 FY2025 against Q1 FY2024
| Line item | Q1 FY2025Q1 FY2024 | Change |
|---|---|---|
| Revenue | $5.55B$7.04B | −21.2% |
| Operating Expenses | $4.34B$4.89B | −11.2% |
| Interest Expense | $135.00M$94.00M | +43.6% |
| Net Income | $418.00M$1.40B | −70.2% |
| EPS (Basic) | $0.68$2.31 | −70.6% |
| EPS (Diluted) | $0.68$2.28 | −70.2% |
| Shares Outstanding (Basic) | 587.26M588.12M | −0.1% |
| Shares Outstanding (Diluted) | 592.98M605.38M | −2.0% |
05—Questions
Frequently Asked Questions
What is the primary driver behind the decrease in overall revenues?
The primary driver for the decrease in overall revenues was a significant decline in investment-related gains (losses) within the Retirement Services segment, which swung from a substantial gain in the prior year period to a loss in the current period, largely due to unfavorable changes in the fair value of certain hedging derivatives and equity indices.
How is the Asset Management segment performing, and what is driving its results?
The Asset Management segment demonstrated resilience, with revenues increasing slightly. Fee Related Earnings (FRE) saw a healthy increase of 21.0%, indicating strong growth in fee-generating assets under management driven by higher management fees, capital solutions fees, and fee-related performance fees. Total AUM also grew significantly, reflecting successful capital deployment and investor demand.
What is the outlook for Athene (Retirement Services) in the current interest rate environment?
Athene's Retirement Services segment experienced an increase in net investment income due to portfolio growth and higher rates on new investments, reflecting benefits from the higher interest rate environment. While cost of funds and interest/financing costs increased, the segment's net investment spread remained relatively stable. Management believes Athene's products would become more attractive to consumers if interest rates rise, potentially increasing sales.
How is Apollo managing its capital and liquidity?
Apollo's liquidity position appears strong, with substantial unrestricted cash and cash equivalents and available funds under its credit facilities. The company's primary liquidity needs are expected to be met by operating cash flows and capital generated from its businesses. Financing activities in the quarter were primarily driven by inflows from retirement services products, partially offset by debt repayments and dividends.
06—Continue