01—Abstract
Summary
Summary of the 8-K filed February 5, 2026. Cited figures are marked; the original filing is the authoritative source.
Ares Management Corp (NYSE: ARES) reported a strong fourth quarter and full year 2025 in its February 5, 2026 8-K.
Q4-25 GAAP net income attributable to Ares Management Corporation was $54.2 milliona ($0.08 per share), down sharply from $177.3 million in Q4-24, largely because of a $255.7 million charge from the change in value of contingent consideration tied to the GCP International acquisition and a $66.4 million unrealized performance loss. For the full year, GAAP net income attributable to Ares was $527.4 million ($1.71 per share, versus $2.04 in 2024). The more important metrics for investors are the non-GAAP measures management emphasizes: Q4-25 Fee Related Earnings rose 33% year over year to $527.7 million, Realized Income rose 24% to $589.1 million, and after-tax Realized Income per Class A share was $1.45, up 18%.
For FY-25, FRE was $1.78 billionb (up 30%) and after-tax RI per share was $4.76 (up 20%). Scale and fundraising were the key operating story. AUM reached $622.5 billion, up 29% year over year, and FPAUM reached $384.9 billion, up 32%.
Ares raised $113.2 billionc of gross new capital in 2025 and deployed a record $145.8 billion. Available capital stood at $156.0 billion, and AUM not yet paying fees was $101.0 billion, including $78.8 billion available for future deployment that management estimates could generate roughly $708 million in incremental annual management fees. Management expects 2026 fundraising to match or exceed 2025's record.
Mechanically, the GCP International acquisition (closed March 1, 2025) contributed meaningfully to AUM and fee growth, and the Real Assets segment's management fees rose 100% for the year. The company also announced a 20% increase in its quarterly Class A common dividend to $1.35d per share, payable March 31, 2026 to holders of record on March 17, 2026.
The Series B mandatory convertible preferred dividend is $0.84375 per share, payable April 1, 2026. Investors should note that GAAP results were volatile, driven by acquisition-related earnout accounting and unrealized performance income swings, so the non-GAAP FRE and RI figures are the primary lens for assessing the underlying business.
02—Key points
Key Highlights
- AUM of $622.5 billion, up 29% year over year; FPAUM of $384.9 billion, up 32%, driven by drawdown fund deployment, perpetual capital growth and the GCP International acquisition.
- Q4-25 Fee Related Earnings of $527.7 million, up 33% year over year, with an FRE margin of 42.5%; full-year FRE of $1.78 billion, up 30%.
- Q4-25 after-tax Realized Income per Class A share of $1.45, up 18%; full-year $4.76, up 20%.
- GAAP Q4-25 net income attributable to Ares of $54.2 million ($0.08 per share), down from $177.3 million a year earlier, driven by a $255.7 million contingent consideration charge tied to GCP International earnouts.
- Record 2025 gross new capital of $113.2 billion and record capital deployment of $145.8 billion; management expects 2026 fundraising to match or exceed these levels.
- Quarterly Class A dividend raised 20% to $1.35 per share (payable March 31, 2026); Series B mandatory convertible preferred dividend declared at $0.84375 per share.
- Available capital of $156.0 billion and $78.8 billion of AUM available for future deployment, which management estimates could add about $708 million in annual management fees.
03—Questions
Frequently Asked Questions
Why did GAAP net income fall so sharply in Q4-25 even though fee-related earnings grew?
The decline was mainly non-cash and acquisition-related. Ares recorded a $255.7 million charge from the change in value of contingent consideration, reflecting progress toward GCP International earnout targets, along with a $66.4 million unrealized performance loss and higher equity compensation tied to acquisitions. These items are excluded from FRE and Realized Income, which is why those metrics grew while GAAP earnings fell.
How much is the dividend increasing and what is the payout timing?
The quarterly dividend on Class A and non-voting common stock is $1.35 per share, a 20% increase. It is payable March 31, 2026 to holders of record at the close of business on March 17, 2026. Ares also has a Dividend Reinvestment Program effective for the March 31 payment, administered by Equiniti Trust Company.
Is the dividend covered by the company's earnings?
Ares sets its common dividend with reference to expected annual FRE after an allocation of current taxes, rather than GAAP net income. FY-25 after-tax Realized Income per share was $4.76 against a quarterly dividend of $1.35 (about $5.40 annualized, though the 20% increase applies from this declaration). Investors should note that the dividend policy explicitly states there is no assurance of continuation at current levels.
What drove the growth in AUM and fee-earning AUM?
AUM rose $138.1 billion year over year, mainly from drawdown fund commitments (notably the third opportunistic credit fund, ACE VI and SDL III), perpetual capital raises (credit BDCs, the open-ended European direct lending fund, APMF and the open-ended infrastructure fund), the GCP International acquisition, and insurance platform growth. Perpetual capital reached $200.0 billion, up 50%, and 85% of AUM is perpetual or long-dated.
What is the outlook for future fee growth?
Management highlighted $101.0 billion of AUM not yet paying fees, of which $78.8 billion is available for future deployment, which management estimates could generate about $708 million in incremental annual management fees if fully invested and paying fees. These are management estimates with no assurance of achievement, and some existing fund fee reductions could offset part of the benefit. Management also expects another strong fundraising year in 2026.
04—Continue