10-QPeriod: Q1 FY2026

Ares Management Corp Quarterly Report for Q1 Ended Mar 31, 2026

Filed May 8, 2026For Securities:ARESARES-PB

Summary

Ares Management Corporation's Q1 2026 filing shows robust growth and operational strength, with total revenues increasing by 28% year-over-year to $1.4 billion. This growth was primarily driven by a significant surge in incentive fees, which more than quadrupled compared to the prior year's first quarter, indicating successful performance generation across its investment strategies. Management fees also saw a healthy 21% increase, reflecting continued AUM growth. The company's diverse segments—Credit, Real Assets, Secondaries, and Private Equity—all contributed positively to Fee Related Earnings (FRE), which grew by 26% overall, demonstrating the recurring nature and underlying strength of its business model. Despite an overall increase in expenses, largely due to higher compensation and benefits associated with growth and strategic acquisitions, Ares Management Corporation maintained a strong profitability profile. The substantial increase in net income attributable to Ares Management Corporation by 202% year-over-year highlights the company's ability to leverage its growing revenue base effectively. Liquidity remains strong, with significant cash on hand and available credit facilities, positioning the company to pursue further growth initiatives and strategic opportunities.

Financial Highlights

26 data points
Beta

Revenue

$1.40B

Net Income

$142.59M

10.2% Net Margin

Total Assets

$28.39B

Cash & Equivalents

$568.78M

Free Cash Flow

$406.51M

Financial Statements
Beta
Revenue$1.40B
SG&A Expenses$240.44M
Operating Expenses$1.17B
Net Income$142.59M

Key Highlights

  • 1Total revenues increased by 28% year-over-year to $1.4 billion, driven by strong performance across all segments.
  • 2Incentive fees saw a substantial increase of over 400% year-over-year, indicating strong investment performance.
  • 3Fee Related Earnings (FRE) grew by 26% year-over-year, demonstrating the stable and recurring nature of management fees and fee-related performance revenues.
  • 4Assets Under Management (AUM) increased to $644.3 billion, with Fee Paying AUM (FPAUM) reaching $399.6 billion, reflecting continued fundraising success.
  • 5Net income attributable to Ares Management Corporation increased by 202% year-over-year, showcasing improved profitability.
  • 6The Credit Group reported a 26% increase in Realized Income and a 17% increase in Fee Related Earnings, driven by strong fee generation and capital deployment.
  • 7The company maintains a strong liquidity position with $568.8 million in cash and cash equivalents and $415.0 million available under its Credit Facility.

Frequently Asked Questions

The substantial increase in incentive fees was primarily driven by strong investment performance across various funds, particularly in the Credit Group. For example, the SDL I fund generated significant incentive fees from the sale of its remaining assets to a continuation vehicle, and the APMF fund in the Secondaries Group saw higher incentive fees due to increased Incentive Generating Assets Under Management (IGAUM).

Total AUM increased to $644.3 billion as of March 31, 2026, up from $545.9 billion as of March 31, 2025. Fee Paying AUM (FPAUM) also saw a significant increase, reaching $399.6 billion from $335.1 billion in the same period, indicating successful fundraising and deployment of capital across the company's various investment strategies.

Expenses increased, with compensation and benefits rising due to continued headcount growth (up 24% year-over-year), strategic acquisitions like GCP, and higher equity compensation expense related to increased stock prices. While expenses are increasing, the company's revenue growth is outpacing expense growth, leading to improved net income.

Ares Management Corporation maintains a strong liquidity position with $568.8 million in cash and cash equivalents and $415.0 million available under its Credit Facility as of March 31, 2026. The company is in compliance with all debt covenants and believes its liquidity is sufficient to meet its foreseeable working capital needs, contractual obligations, dividend payments, and strategic initiatives.