01—Abstract
Summary
Summary of the 8-K filed May 5, 2026. Cited figures are marked; the original filing is the authoritative source.
KKR reported first quarter 2026 results that showed strong growth in its recurring earnings.
Fee Related Earnings (FRE) rose 24% year-over-year to $1.0 billiona ($1.13 per adjusted share), Total Operating Earnings (TOE) rose 19% to $1.3 billion ($1.47 per adjusted share), and Adjusted Net Income (ANI) rose 21% to $1.2 billion ($1.39 per adjusted share). Assets under management reached $758 billion, up 14% year-over-year, and fee-paying AUM reached $615 billion, up 17%. KKR raised $28 billion of new capital in the quarter and $127 billion over the last twelve months, and invested $22 billion in the quarter.
Management characterized about 85% of segment earnings as coming from the more durable, recurring portions of the business. GAAP results improved sharply. Net income attributable to KKR common stockholders was $365 millionb in Q1 2026, compared with a loss of $186 million in Q1 2025, and diluted EPS was $0.38 versus $(0.22).
The filing notes that GAAP results are heavily influenced by insurance investment gains and losses and by consolidation effects, so investors should weigh the non-GAAP segment metrics alongside GAAP figures. Trailing-twelve-month ANI grew only 5% to $4.6 billionc, which is a notable contrast to the quarterly growth rate. Other items of note include a declared quarterly dividend of $0.195 per common share (5% higher on an annualized basis than 2025), $317 million of share repurchases and retirements from year-end through May 1, 2026 at an average price of $91.08, and an increase of $500 million to the buyback authorization.
KKR also closed its acquisition of Arctos Partners, a sports-franchise investor with $16 billiond of AUM, on May 5, 2026, subsequent to quarter end. Management expects Strategic Holdings Operating Earnings of $350 million or more in 2026, $700 million or more by 2028, and $1.1 billion or more by 2030.
02—Key points
Key Highlights
- Fee Related Earnings of $1.0 billion ($1.13 per adjusted share) in Q1 2026, up 24% year-over-year; LTM FRE of $3.9 billion, up 14%.
- Total Operating Earnings of $1.3 billion ($1.47 per adjusted share), up 19%; Adjusted Net Income of $1.2 billion ($1.39 per adjusted share), up 21% year-over-year, though LTM ANI grew only 5% to $4.6 billion.
- AUM of $758 billion (up 14%) and fee-paying AUM of $615 billion (up 17%); perpetual capital reached $326 billion, representing 43% of AUM.
- GAAP net income attributable to KKR common stockholders of $365 million (diluted EPS $0.38) versus a loss of $186 million a year earlier, partly driven by insurance investment results.
- Capital deployment and fundraising were strong: $28 billion of new capital raised and $22 billion invested in Q1, with $127 billion raised and $97 billion invested over the last twelve months.
- Capital return: quarterly dividend of $0.195 per share (5% annualized increase), $317 million of buybacks through May 1 at $91.08 average, and a $500 million buyback authorization increase.
- Arctos Partners acquisition closed May 5, 2026 (about $16 billion AUM), and Strategic Holdings earnings are guided to $350 million+ in 2026, $700 million+ by 2028, and $1.1 billion+ by 2030.
03—Questions
Frequently Asked Questions
Why did GAAP net income swing from a loss to a profit, and how should investors interpret it?
The swing reflects a much smaller net investment-related loss in the insurance segment ($653 million in Q1 2026 versus $1.44 billion in Q1 2025), along with higher investment income in the asset management segment compared with the prior year. GAAP results are volatile because they include unrealized investment gains and losses and consolidation effects. Management emphasizes non-GAAP measures such as FRE, TOE and ANI, which exclude many of these items, so investors should review both views.
What is the significance of the Arctos Partners acquisition?
KKR closed its acquisition of Arctos Partners on May 5, 2026, shortly after quarter end. Arctos is described as a premier institutional investor in professional sports franchise stakes and a provider of asset management solutions for sponsors, with $16 billion of AUM. The filing lists risks that the acquisition may not achieve its intended results. Its contribution to future fee and earnings growth has not been quantified in this release.
Are shareholder returns sustainable?
KKR declared a $0.195 quarterly common dividend, payable May 29, 2026 to holders of record on May 15, 2026, and has raised its annualized dividend every year since its 2018 C-Corp conversion. Buybacks totaled $317 million through May 1, and the board increased the repurchase authorization by $500 million. Dividend declaration is at the board's discretion and depends on future financial performance, so the filing does not guarantee continued increases. Trailing ANI growth of 5% also suggests investors should monitor earnings growth relative to payout.
What does the outlook for Strategic Holdings look like?
Management expects Strategic Holdings Operating Earnings of $350 million or more in 2026, $700 million or more by 2028, and $1.1 billion or more by 2030. Q1 2026 Strategic Holdings Operating Earnings were $48 million, up from $31 million a year earlier, and LTM earnings were $179 million. These projections are forward-looking, depend on dividends from portfolio companies, and the filing notes they may be materially lower or may not materialize at all.
What are the main growth drivers and risks behind KKR's fee-related business?
Growth in FRE was driven mainly by higher management fees, which reached $1.19 billion in Q1 2026 (up from $917 million) as fee-paying AUM grew from organic new capital raised. Management fees rose 23% over the last twelve months to $4.4 billion. Risks include fundraising cycles, market and economic conditions, reliance on continued inflows into perpetual and K-Series vehicles, and possible changes to perpetual capital, which the filing says can be reduced or terminated under certain conditions.
04—Continue