KKR · KKR & Co. Inc. 6.875% Subordina

KKR & Co. Inc. delivered robust Q1 2026 results amid market volatility, with Fee Related Earnings surging 24% year-over-year to $1.0 billion, driven by higher management fees of $1.2 billion (up from $917 million) and steady transaction fees. This growth underscores the durability of KKR's asset management franchise, as management fees and fee-related performance revenues expanded while expenses were managed efficiently. Total Operating Earnings rose 19% to $1.3 billion, reflecting contributions from insurance operating earnings ($260 million) and strategic holdings ($48 million), representing 85% of total segment earnings and highlighting a resilient earnings base less exposed to market swings. Adjusted Net Income increased 21% to $1.2 billion, or $1.39 per adjusted share, supported by accelerated monetization activity and realized performance income doubling to $197 million. AUM expanded 14% to $758 billion and FPAUM grew 17% to $615 billion, fueled by $28 billion in new capital raised during the quarter. Management emphasized record capital invested over the past 12 months ($97 billion), signaling strong deployment momentum. Capital returns remain shareholder-friendly: a 5% annualized dividend increase to $0.195 per share, plus $317 million in share repurchases (3.5 million shares at $91.08 average), with a $500 million program expansion. The Arctos acquisition closing adds $16 billion AUM in sports franchise stakes, enhancing KKR's platform diversity. Co-CEOs Joseph Y. Bae and Scott C. Nuttall expressed high confidence in long-term positioning, citing 50 years of cycle navigation.