OWL Earning Date, Transcript Summary & Report

Record Fundraising Success: We capped off a highly successful year for Blue Owl with a record quarter of fundraising, reflecting the ongoing diversification of our business and high levels of investor interest in our differentiated products.

Record Equity and Debt Raise: This brings our total equity raise in 2024 to $27.5 billion, about 75% higher than 2023, and including debt, we raised over $47 billion, also a record for us.

Capital Deployment and FRE Growth: We deployed substantial amounts of capital across the business, including a record $52 billion of gross deployment in credit, driving 26% FRE growth for the year.

Consistent FRE Growth: We have now grown FRE at least 25% each year since we've been public, despite highly inflationary periods, geopolitical events, rate volatility, and a significant slowdown in capital markets.

Resilient Revenue Sources: Approximately 90% of our management fees come from permanent capital, making our revenues highly resilient.

Management Fee Growth Potential: We have over $23 billion of AUM that will begin to pay management fees once capital is deployed, which will drive an incremental $290 million of revenue or 13% growth off our current management fees over the last 12 months.

Merger Impact on Fees: We successfully completed the merger of OTF and OTF2 in March, which will drive approximately $135 million of incremental annual management fees for Blue Owl.

Management Fee Growth: We have grown our management fees by 31%, our FRE by 23%, and our DE by 20% on an LTM basis.

Capital Raising Success: During the first quarter, we raised over $6.5 billion with $4 billion raised in private wealth, primarily across our perpetually distributed products and GP stakes.

Direct Lending Origination Surge: In direct lending, gross origination was nearly $13 billion and over $4.5 billion for the quarter, more than double our net origination in the prior quarter.

Direct Lending Strategy Resilience: Our direct lending strategy was built for these types of markets, volatility and uncertainty, and we feel very good about the credit quality of our portfolio with a 13 basis point average annual realized loss rate.

Strong Alternative Credit Returns: We are seeing very resilient performance across asset-based categories in alternative credit, with portfolio gross returns of 6.1% in the first quarter and 15.2% over the last 12 months.

Record Commitments in Real Assets: In real assets, we had a record quarter of commitments totaling $3.8 billion, bringing commitments over the last 12 months to $8 billion at a roughly 8% cap rate on average.

Fund 3 Final Close: We held our final close from Fund 3 in April, reaching its hard cap of $7 billion, nearly double the size of the prior fund.

Direct Lending Decline: The company reported a decline in net origination in direct lending, with only $4.5 billion for the quarter, which is a significant drop compared to previous quarters.

Fundraising Amid Economic Uncertainty: Despite a record quarter of fundraising, the overall economic environment remains uncertain, with concerns about inflation, economic growth, and potential recession affecting investor sentiment.

Global Trade Challenges Ahead: The company acknowledged that the flow of global trade and its pricing may be substantially altered going forward, indicating potential challenges ahead.

Consumer Demand Uncertainty: There is a noted lack of concrete answers regarding consumer demand and economic growth, which could impact future performance.

Management Fee Uncertainty: The company has a significant amount of AUM that is yet to pay management fees, which may create uncertainty in future revenue streams until capital is deployed.

Credit Quality Risk: While the company has seen strong performance in its portfolios, there is still a risk of credit quality deterioration in the broader market, which could affect their investments.

Market Volatility Challenges: The company is facing challenges in the market due to elevated volatility, which may impact their ability to maintain growth rates in the future.