In This Article:
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Fundraising: $2.9 billion in Q1, highest in over two years.
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Infrastructure Fundraising: Nearly $500 million final close for IAF II, total fund size $1.3 billion.
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Private Equity Fundraising: Over $720 million raised, GCF III fund size approximately $615 million.
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Management Fees: Private markets management fees increased 20% year over year.
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Fee-Related Revenue: Grew 12% year over year.
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Fee-Related Earnings: Increased 22% year over year.
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Adjusted EBITDA: Grew 26% year over year.
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Adjusted Net Income: Increased 30% year over year.
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Assets Under Management (AUM): Grew to $82 billion.
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Fee-Paying AUM: Increased to $66 billion.
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Contracted Not Yet Fee-Paying AUM: Grew 16% year over year to $8.2 billion.
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Carried Interest Balance: Grew to $865 million, an 11% increase from a year ago.
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Firm's Share of Carry: Grew by 12.5% to $415 million.
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Dividend: Maintained at $0.11 per share.
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Dividend Yield: 3.5% as of the call date.
Release Date: May 07, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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GCM Grosvenor Inc (NASDAQ:GCMG) reported strong first-quarter results, exceeding profitability expectations.
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The company achieved its highest quarterly fundraising level in over two years, with a total of $2.9 billion.
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Private markets management fees increased by 20% year over year, driven by significant fundraising success.
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The firm's carried interest balance grew to $865 million, an 11% increase from the previous year.
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GCM Grosvenor Inc (NASDAQ:GCMG) announced two strategic initiatives: a joint venture called Grove Lane and a strategic partnership in Japan, both expected to contribute significantly to future revenue and profit.
Negative Points
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Market volatility and uncertainty related to trade and tax policy are expected to keep deployment and transaction levels depressed.
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Incentive fee levels for the industry and GCM Grosvenor Inc (NASDAQ:GCMG) are unlikely to reach the levels experienced last year due to challenging equity markets.
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The company anticipates that Absolute Return Strategies (ARS) management fees will remain flat compared to 2024.
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There is limited visibility around investment committee decisions due to policy volatility, affecting short-term deployment.
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The company expects limited additional catch-up fees for the remainder of the year, impacting revenue growth potential.
Q & A Highlights
Q: Can you discuss the factors affecting the 5% to 8% growth in private markets management fees for 2025 and what could drive it back to 10%+ in the long term? A: Michael Sacks, CEO, explained that short-term factors include how much of the funds raised go directly to fee-paying AUM versus contracted not yet fee-paying AUM, and the speed of deployment from the latter. Long-term, the outlook remains strong, with significant fundraising increases and a robust pipeline. The ability to meet FRE goals by 2028 remains solid.