Blue Owl Capital Inc. Q1 FY2026 earnings call

• Operate three differentiated platforms at scale with growth driven by fundraising and capital deployments. Raised $57 billion in capital over the last 12 months, $11 billion in the first quarter. - Fundraising results show good interest from various investors across diverse strategies. Institutional capital represented two-thirds of total equity raised in the first quarter. - Performance across credit, real assets, and GP strategic capital remains resilient with attractive absolute and relative returns. - Platforms have seen growth in equity capital raised outside of direct lending, and certain funds like BOSE and ASOP9 closed above targets. - Deployment in real assets has accelerated with significant pipelines in net lease and digital infrastructure.

Revenues increased by 13%, fee-related earnings by 14% and distributable earnings by 11% compared to the first quarter of 2025. Direct lending represents 37% of AUM, Real Assets is 27% of AUM, and GP Strategic Capital is 22%. Alternative Credit and Net Lease have grown their AUM by roughly 40% year over year. Digital infrastructure strategy is approximately 6% of AUM. In credit, $4 billion of equity capital raised in the first quarter included about $1 billion in non-traded BDCs. In real assets, NetLease contributed about $3 billion of the $4 billion of equity capital raised. In GP strategic capital, $900 million was raised primarily in the flagship vehicle and co-invest during the first quarter.

• Remain focused on disciplined expense management and expect to achieve 58.5% FRE margins for 2026. - Committed to paying out a 92-cent dividend for 2026. - Expect fee-paying AUM to grow as they continue to deploy capital across products and strategies. - Cautiously optimistic about fundraising outlook for various products and strategies, with several funds having strong prospects for closing and reaching targets.

• Geopolitical uncertainty and interest rate volatility can impact performance. - Redemption requests in the non-traded BDCs industry-wide, but impact on Blue Owl was modest. - Uncertainty around the software maturity wall and potential refinancing challenges in the future. - Volatility in software equities and potential credit losses, although prepared to manage through them.

• Q: On $6 billion of institutional fundraising in the quarter, size credit inflows and specific funds.

A: Flows come through across credit platform, including into direct lending, non-traded BDCs, ASOP 9, etc. - Q: On wealth, redemptions driven by investors vs advisors, flows in direct lending and other vehicles.

A: Advisors want products to work as designed, sentiment shifts to other asset classes, non-direct lending capabilities have strong returns. - Q: On fee rates in credit and real estate.

A: Credit had BOS one-time catch-up fees, real estate fee rate had no specific noise. - Q: On dry powder timing and phasing of deployment, April activity, software investment.

A: Deploy selectively at higher spreads, activity healthy, software investment has good pipelines and risk return. - Q: On credit stats, software maturity wall.

A: No material negative developments in portfolios, software refinances will need equity injection, prepared to manage through. - Q: On direct lending funds exposure to SpaceX and gains offsetting credit losses.

A: Made 10x money on SpaceX, gains contribute to offsetting potential losses. - Q: On FRE margin outlook and impact of retail fundraising slowdown.

A: Focused on expense management, expect to achieve 58.5% FRE margins, wider range of revenue outcomes possible. - Q: On fundraising outlook for 2026 between institutional and retail.

A: Cautiously optimistic, various products and strategies have strong prospects, deployment of AUM not yet earning fees will contribute. - Q: On outlook for direct lending fee-paying AUM.

A: Expect fee-paying AUM to grow as they deploy capital. - Q: On compensation, stock-based comp trajectory.

A: In line with guidance, combination of cash and stock for compensation. - Q: On balance sheet revolver and dividend dynamic.

A: Revolver steps up in 1Q and comes down, committed to paying dividend, payout ratio expected to come down. - Q: On catch-up fees in credit business.

A: About $7 million for Bose product.