BLK · 8-K · 20260715PR304013

Operating Margin Drivers

BlackRock, Inc. · 2026-07-15 · Importance 64 · Surprise 56 · No source text

Second-quarter GAAP operating income increased 42% year over year to $2.461 billion, while GAAP operating margin expanded 280 basis points to 34.7%. Adjusted operating income increased 39% to $2.916 billion, and adjusted operating margin increased 260 basis points to 45.9%, its highest level in almost five years. The adjusted results exclude $276 million of intangible-asset amortization, $95 million of acquisition-related compensation costs, $60 million of deferred-cash-compensation expense, and $11 million of contingent-consideration expense. Six-month GAAP operating margin was 38.3%, up 630 basis points, while six-month adjusted operating margin was 45.2%, up 200 basis points.

Key facts

• As adjusted operating income for the quarter was $2,916 million, a 39% increase year-over-year. source
• As adjusted operating margin for the quarter was 45.9%, compared with 43.3% in the prior year quarter. source
• GAAP operating margin for the quarter was 34.7%, compared with 31.9% in the prior year quarter (up 280 basis points). source
• Quarterly nonoperating income (GAAP) was $258 million, and nonoperating income (net of NCI - CIPs) was $223 million. source
• As adjusted nonoperating income, net of NCI - CIPs, for the quarter was $145 million. source
• Management believes excluding the gain (loss) on the economic hedge of the deferred cash compensation plans when calculating nonoperating income (expense), less net income (loss) attributable to NCI - CIPs, as adjusted, provides a useful measure of BlackRock's nonoperating results that impact book value. source
• Management excludes compensation expense related to the market valuation changes on certain deferred cash compensation plans from operating income, as adjusted. source
• Revenue used for calculating operating margin, as adjusted, is reduced to exclude all of the Company's distribution fees and a portion of investment advisory fees used to pay distribution and servicing costs. source

Impact estimates