How did Ares perform on its key non-GAAP earnings metrics in Q2 2026?

Fee Related Earnings rose 20% year over year to $491.1 million, and After-tax Realized Income per Class A share rose 25% to $1.29. Both metrics were supported by growth in management fees, which increased 14% for the quarter on an unconsolidated basis, and by higher realized performance income.

Why is GAAP net income per share only $0.49 when the non-GAAP metrics grew faster?

GAAP results include the effects of consolidated funds, non-cash equity compensation, amortization of intangibles, unrealized performance income and fair value changes, and noncontrolling interests. Management therefore emphasizes FRE and After-tax Realized Income, which exclude these items, as better measures of ongoing operating performance.

Is the $1.35 quarterly dividend sustainable?

Ares sets its common dividend in line with expected annual FRE after an allocation of current taxes, and it says it would reduce or suspend dividends if FRE were insufficient to fund them over a sustained period. The Q2 results show FRE of $491.1 million and After-tax RI per Class A share of $1.29, which together support the current payout level, but the filing does not guarantee future dividends.

What drove the record fundraising and what does it mean for future fees?

Fundraising of $36.4 billion was led by drawdown fund commitments in credit (including U.S. and European direct lending) and capital raised by perpetual vehicles such as BDCs, the open-ended infrastructure fund and the open-ended European direct lending fund. Capital raised but not yet deployed sits in AUM Not Yet Paying Fees and dry powder, which management says supports future management fee growth as that capital is invested.

What are the main risks investors should keep in mind?

Key risks include the pace of capital deployment in a slower transaction environment, fund performance (for example, the corporate private equity and secondaries funds showed negative quarterly returns), reliance on performance-related fees that can reverse, and the dependence of fee revenues on perpetual capital vehicles whose investment management agreements may be terminated. The filing also reports $1.6 billion drawn on a $2.5 billion revolving credit facility, and investors should review the full risk factors in Ares' SEC filings.

ARES/ARES-PB 8-K: Earnings & Results & Regulation FD

01—Abstract

Summary

Summary of the 8-K filed July 31, 2026. Cited figures are marked; the original filing is the authoritative source.

Ares Management Corp. (NYSE: ARES) reported second-quarter 2026 results on July 31, 2026, showing continued strong top-line and fee-based growth.

GAAP net income attributable to Ares Management Corporation was $150.6 million^a, or $0.49 per share, up from $137.1 million in Q2-25. The more closely watched non-GAAP metrics were stronger: Fee Related Earnings (FRE) rose 20% year over year to $491.1 million, and After-tax Realized Income per Class A share was $1.29, up 25% from $1.03. Total Assets Under Management reached $671.3 billion (up 17% year over year), and Fee Paying AUM reached $409.9 billion (also up 17%).

Fundraising was a highlight, with $36.4 billion^b raised in the quarter and net inflows of $34.4 billion, which management described as a record quarter for fundraising. Gross capital deployment was $35.9 billion, and firmwide available capital (dry powder) reached a record $170.0 billion. Management said the investment pipeline is picking up after a slower transaction environment in the first half, and it expects to maintain its annual financial targets.

Note that the GAAP results include consolidated fund effects, so investors should focus on FRE and After-tax RI for underlying operating performance. Capital return remains a key feature of the story. Ares declared a quarterly Class A common dividend of $1.35^c per share, payable September 30, 2026, and a Series B mandatory convertible preferred dividend of $0.84375 per share.

The filing also notes a dividend reinvestment program that becomes effective with the September dividend. The quarter also included a $395.0 million^d IPO by the third sponsored SPAC, Ares Acquisition Corporation III, which closed on July 1, 2026.

02—Key points

Key Highlights

Fee Related Earnings of $491.1 million, up 20% year over year, with an FRE margin of 42.2%.
After-tax Realized Income of $1.29 per Class A share, up 25% from $1.03 in Q2-25; GAAP EPS of $0.49 vs. $0.46 a year earlier.
Record quarterly fundraising of $36.4 billion, with net inflows of $34.4 billion; gross capital deployment of $35.9 billion, up from $26.9 billion.
Total AUM of $671.3 billion (+17% YoY) and FPAUM of $409.9 billion (+17% YoY); 84% of AUM is perpetual or long-dated capital.
Record $170.0 billion of available capital (dry powder) and $92.6 billion of AUM available for future deployment, which management says could generate roughly $807 million of incremental annual management fees.
Quarterly Class A dividend of $1.35 per share (payable September 30, 2026), plus a Series B preferred dividend of $0.84375 per share; dividend reinvestment program becomes effective with the September payment.
Management reports a meaningful pickup in the investment pipeline and reaffirms it remains on track for full-year financial goals; the company reports no contingent liabilities or going-concern issues in this filing.

03—Questions

Frequently Asked Questions

How did Ares perform on its key non-GAAP earnings metrics in Q2 2026?
Fee Related Earnings rose 20% year over year to $491.1 million, and After-tax Realized Income per Class A share rose 25% to $1.29. Both metrics were supported by growth in management fees, which increased 14% for the quarter on an unconsolidated basis, and by higher realized performance income.
Why is GAAP net income per share only $0.49 when the non-GAAP metrics grew faster?
GAAP results include the effects of consolidated funds, non-cash equity compensation, amortization of intangibles, unrealized performance income and fair value changes, and noncontrolling interests. Management therefore emphasizes FRE and After-tax Realized Income, which exclude these items, as better measures of ongoing operating performance.
Is the $1.35 quarterly dividend sustainable?
Ares sets its common dividend in line with expected annual FRE after an allocation of current taxes, and it says it would reduce or suspend dividends if FRE were insufficient to fund them over a sustained period. The Q2 results show FRE of $491.1 million and After-tax RI per Class A share of $1.29, which together support the current payout level, but the filing does not guarantee future dividends.
What drove the record fundraising and what does it mean for future fees?
Fundraising of $36.4 billion was led by drawdown fund commitments in credit (including U.S. and European direct lending) and capital raised by perpetual vehicles such as BDCs, the open-ended infrastructure fund and the open-ended European direct lending fund. Capital raised but not yet deployed sits in AUM Not Yet Paying Fees and dry powder, which management says supports future management fee growth as that capital is invested.
What are the main risks investors should keep in mind?
Key risks include the pace of capital deployment in a slower transaction environment, fund performance (for example, the corporate private equity and secondaries funds showed negative quarterly returns), reliance on performance-related fees that can reverse, and the dependence of fee revenues on perpetual capital vehicles whose investment management agreements may be terminated. The filing also reports $1.6 billion drawn on a $2.5 billion revolving credit facility, and investors should review the full risk factors in Ares' SEC filings.

04—Continue

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