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    APO
    Earnings call· Sep 2025(Q3 FY25)

    Apollo Global Management, Inc. APO

    Nov 4, 2025 Source

    Executive summary

    Apollo Global Management Q3 FY25 — Record Earnings and Strong Origination Drive Growth

    Apollo Global Management delivered exceptionally strong Q3 FY25 results, driven by record fee and spread-related earnings and robust origination volumes. The firm is capitalizing on secular trends in global industrial renaissance, retirement solutions, and private market alternatives, expanding its reach across multiple investor markets. Management expressed confidence in continued growth, with a focus on innovation, disciplined underwriting, and strategic partnerships to navigate evolving market dynamics.

    Highlights

    5

    • Record combined fee and spread related earnings drove adjusted net income of $1.4 billion, up 17% YoY.

    • Fee-related earnings (FRE) of $652 million, up 23% YoY.

    • Strong origination of $75 billion in the quarter, second strongest ever, bringing LTM volume to over $270 billion (up 40% vs prior period).

    • Robust inflows of $82 billion, including $49 billion organic, leading to record AUM of $908 billion, up 24% YoY.

    • Retirement Services (Athene) generated $23 billion of organic inflows in the quarter, pacing toward a record year.

    Concerns

    4

    • Credit spreads are tight, requiring proprietary origination and discipline to maintain ROE targets.

    • Asset prepayment headwinds expected to peak through Q1 2026 for Athene.

    • Spread drag from profitable COVID-era business dissipating in 2026 relative to 2025.

    • The industry is limited by its capacity to find good investments rather than to raise capital.

    Guidance & targets

    8
    CategoryTargetConfidence
    SRE ex notables
    approximately $880 million
    medium materiality
    High
    Full year SRE
    approximately $3.475 billion
    high materiality
    High
    FRE growth
    20% plus
    high materiality
    High
    SRE growth
    10% growth
    high materiality
    High
    Average annual FRE growth
    20%
    high materiality
    High
    Average annual SRE growth
    10%
    high materiality
    High
    FRE equaling SRE
    sometime in 2028
    high materiality
    High
    Fund XI launch
    sometime in the first half of 2027
    medium materiality
    Medium

    Segment performance

    2
    SegmentRevenueYoYQoQMargin
    Asset Management
    Strong growth driven by third-party asset management inflows, record gross capital deployment, and robust ACS fees from diverse businesses.
    Fee-related earnings (FRE): $652 millionFRE growth YoY: 23%Management fee growth YoY: 22%ACS fees: $212 millionFee-related performance fees growth YoY: 28%Assets Under Management (AUM): $908 billionAUM growth YoY: 24%Fee-Generating Assets Under Management (FG-AUM): $685 billionFG-AUM growth YoY: 24%
    		————
    Retirement Services (Athene)
    Strong organic growth supported by significant gross inflows, with core earnings power evident. New business meets long-term ROE targets.
    Spread-related earnings (SRE) ex notables: $846 millionNet invested assets: $286 billionNet invested assets growth YoY: 18%Gross inflows: $23 billionBlended net spread ex notables: 121 bps
    		————

    Operational metrics

    53
    Adjusted Net Income
    $1.4 billionup 17% year-over-year
    Q3 FY25

    Drove by record combined fee and spread related earnings.

    Adjusted EPS
    $2.17up 17% year-over-year
    Q3 FY25

    Drove by record combined fee and spread related earnings.

    Origination Volume
    $75 billionsecond strongest quarter
    Q3 FY25

    Led by platforms.

    Origination Volume
    $270 billionup more than 40% versus the prior period
    LTM

    Effectively achieves multiyear target 3-4 years early.

    Average Spread on Origination
    350stable quarter-over-quarter
    Q3 FY25

    Over treasuries, average rating of BBB.

    Inflows
    $82 billion
    Q3 FY25

    Led by asset management of $59 billion and retirement services of $23 billion.

    Organic Inflows (ex-Bridge)
    $26 billion
    Q3 FY25

    Organic inflows, excluding $34 billion from Bridge acquisition.

    Asset Management Inflows
    $59 billion
    Q3 FY25

    Includes $34 billion from Bridge.

    Retirement Services Inflows
    $23 billion
    Q3 FY25

    Organic inflows.

    Credit Performance
    8% to 12%
    LTM

    Performance across credit buckets.

    Credit Performance
    3% to 5%
    Q3 FY25

    Performance across credit buckets.

    ADS Annual Return
    9%
    since inception

    For ADS (Apollo Debt Solutions).

    ADS Return
    2.1%
    Q3 FY25

    For ADS.

    Hybrid Franchise AUM
    $90 billion
    current

    With nearly $12 billion raised year-to-date.

    Hybrid Franchise LTM Return
    19%
    LTM

    For hybrid franchise.

    AAA AUM
    $25 billionapproaching
    current

    Apollo Aligned Alternatives.

    AAA Positive Quarters
    42 of 43
    inception-to-date

    With a fraction of S&P volatility.

    AAA LTM Rate of Return
    11%
    LTM

    For AAA strategy.

    AAA Inception-to-Date Return
    12%
    inception-to-date

    For AAA strategy.

    Private Equity Fund X Net IRR
    22%
    inception-to-date

    For Fund X.

    Private Equity Fund X DPI
    0.2%
    inception-to-date

    For Fund X.

    Private Equity Fund IX Net IRR
    15%
    inception-to-date

    For Fund IX.

    Private Equity Fund IX DPI (vs industry average)
    50% higher
    inception-to-date

    For Fund IX, compared to industry average.

    Private Equity Franchise Gross Return
    39%
    history

    Across Apollo's history.

    Private Equity Franchise Net Return
    24%
    history

    Across Apollo's history.

    Athene New Business ROE Target
    mid-teens
    current

    New business remains in line with this target.

    Athene Deployed Capital
    $22 billion
    Q3 FY25

    At 220 basis points over treasuries, almost all IG.

    Athene SRE Sensitivity (25 bps short-term rate move)
    $10 million to $15 millionversus $30 million to $40 million previously
    current

    On net floaters, after hedging actions.

    Athene Net Floating Rate Assets
    $6 billion
    Q3 FY25

    At quarter end.

    Debt Origination
    $69 billion
    Q3 FY25

    Total debt comprised of IG and sub-IG.

    Investment Grade Origination Excess Spread
    285
    Q3 FY25

    Over treasuries.

    Sub-Investment Grade Origination Excess Spread
    400
    Q3 FY25

    Over treasuries.

    Platform Origination Volume Growth
    20%
    YoY

    Across 16 platforms.

    MidCap Growth
    30%
    YTD

    For MidCap platform.

    Sponsor Solutions Ecosystem Volume
    $70 billionmore than tripled in recent years
    LTM

    Growing from $20 billion in 2022.

    Organic Inflows
    $49 billionnearly matching last quarter's record
    Q3 FY25

    Including $34 billion from Bridge acquisition.

    Organic Inflows Mix
    80%
    Q3 FY25

    Within $26 billion of organic inflows across institutional and Global Wealth.

    Global Wealth Inflows
    $5 billionsecond best quarter on record
    Q3 FY25

    For the wealth channel.

    Global Wealth Inflows
    $14 billionup 60% over the prior year period
    YTD

    For the wealth channel.

    ABC Inflows
    $400 millionstrongest quarter since launch
    Q3 FY25

    For the asset-based focused corporation.

    Athene Retail Inflows
    $10 billion
    Q3 FY25

    Particularly strong in fixed index annuities and MYGAs.

    Athene Funding Agreement Inflows
    $10 billionthird strongest quarter on record
    Q3 FY25

    Capitalizing on favorable issuance backdrop.

    Athene Flow Reinsurance Inflows
    $3 billion
    Q3 FY25

    From flow reinsurance.

    Athene RILA Inflows
    $1 billion
    YTD

    For RILA products.

    Bridge Annual Fee-Related Revenues
    $300 million
    annual

    Across management fees and ACS fees.

    Bridge Annual Pretax FRE Contribution
    $100 million
    annual

    With expenses principally compensation based.

    FRE Margin (ex-Bridge)
    stableexpanded approximately 120 basis points year-to-date
    QoQ

    Demonstrating continued scaling of business.

    Full Year FRE Margin (including Bridge)
    consistent with 2024
    FY25

    Expected.

    SRE ex notables
    $880 millionapproximately stable to Q3
    Q4 FY25

    Assuming 11% alt return, equivalent SRE spread of 125 bps.

    SRE Spread
    125
    Q4 FY25

    Equivalent SRE spread.

    Share Repurchases
    $350 million
    Q3 FY25

    Executed during the quarter, majority opportunistic.

    Athene Alts Portfolio Return (AAA)
    10.9%
    LTM

    For the largest component of Athene's alts portfolio.

    401(k) Managed Account Assets
    couple of billion
    current

    In various managed account platforms.

    Industry KPIs

    1
    MetricValueDetails
    Capital returns$350 millionUSD

    Product announcements

    7
    ProductTypeDetails
    Olympus Housing Capitallaunch
    Stream Data Centersexpansion
    TenFiftylaunch
    Apollo Sports Capital (ASC)launch
    RILA (Registered Index-Linked Annuities)update
    Stable Value and Structured Settlementslaunch
    Tax Advantage and Guaranteed Incomelaunch

    Deals & partnerships

    4
    BridgeAcquisition of Bridge, enhancing existing real estate business, bringing scale to multifamily and industrial, and adding origination capabilities synergistic with Athene.

    Closed on September 2.

    Keurig Dr PepperProvided a financing solution to support strategic objectives.$7 billion

    Announced last week. Example of leading position in high-grade capital solutions and hybrid marketplace.

    ØrstedApollo funds will acquire a 50% stake in Hornsea 3, a 3-gigawatt scale offshore wind project.$6.5 billion

    Announced yesterday.

    PICAthora's pending acquisition.

    Expected to receive regulatory approval.

    Risks & headwinds

    7
    Origination Capacity Limitationongoing

    nil

    Mitigation: Focus on growing origination quarter-over-quarter and respecting the principle of excess return per unit of risk.

    Culture Riskongoing

    unquantified

    Mitigation: Working hard day and night to ensure preferred employer status is not lost.

    Credit Market Idiosyncrasiescurrent

    10 basis points of spread widening is essentially nothing

    Mitigation: Vigilant underwriting and risk management efforts; emphasizing that observed stress is idiosyncratic, not systematic.

    Athene Asset Prepayment Headwindspeaking through Q1 2026

    unquantified

    Mitigation: Expectation that headwinds will diminish due to reduced CLO purchases and high prepayment levels.

    Athene Spread Drag from COVID-era Businessdissipating in 2026 relative to 2025

    unquantified

    Mitigation: Expectation that this headwind will have peaked in 2025.

    Regulatory Scrutiny of Private Letter Ratingscurrent

    Athene uses less than 8% Kroll/DBRS ratings, 70% 2+ ratings from major agencies.

    Mitigation: Providing transparency on Athene's rating agency usage and credit quality, emphasizing disciplined underwriting and strong capital profile.

    Rate Cut Impact on SREFY26 and beyond

    Outlook embeds current forward rate curve contemplating 3 total cuts by year-end '26 and 9.5 total cuts over the cycle.

    Mitigation: Athene has significantly reduced its sensitivity to floating rates to the lowest in a decade; management actions include managing floating rate position, optimizing back book, utilizing sidecar capital, and prudently managing crediting rates.

    What to watch in Q4 FY25

    5

    Q4 FY25 SRE ex notables

    Q4 FY25
    Current$846 million
    TargetApproximately $880 million

    Why it matters

    This is a direct short-term financial target that indicates the immediate trajectory of Athene's spread-related earnings and the effectiveness of management's mitigation strategies against spread compression and prepayment headwinds.

    For the fourth quarter, as Marc suggested, we anticipate SRE ex notables to be approximately stable to Q3 at an 11% alt return or approximately $880 million with an equivalent SRE spread of 125 basis points.

    Q&A highlights

    6

    Given strong origination ($270B LTM vs $275B 5-year target), has the target changed?

    Management is very happy with the accelerated success and momentum, but it's too early to change the 5-year estimates. The growth is tied to the expanded universe of buyers and broader solutions, with 75% of next year's growth from existing vehicles.

    “it'd be a mistake to change our 5-year estimates 9 to 12 months into the plan.”

    asked by Steve Chubak · answered by James Zelter

    2 min read6 chapters

    Detailed Narrative

    01

    Origination and Growth Flywheel

    Apollo reported $75 billion in origination for Q3 FY25, its second strongest quarter, bringing LTM volume to over $270 billion, exceeding its multi-year target 3-4 years early. This robust origination, coupled with $82 billion in inflows ($49 billion organic), drove record AUM of $908 billion, up 24% year-over-year. The firm emphasizes origination as the 'lifeblood' of its business, fueling a 'growth flywheel' that is expected to contribute significantly to future earnings.

    02

    Expanding Market Opportunities

    Marc Rowan identified five new market segments beyond traditional institutional alternatives: individuals (Global Wealth), insurance companies (leveraging Athene's model), institutional clients investing from debt/equity buckets (total portfolio approach), traditional asset managers (integrating private assets into public portfolios), and 401(k) plans. These new markets are expected to drive significant demand for private assets, with traditional asset managers and 401(k)s representing potentially the largest future growth avenues.

    03

    Wealth Management Strategy

    Apollo's Global Wealth business saw its second-best quarter with $5 billion in inflows, bringing year-to-date total to over $14 billion, up 60% YoY. The firm is expanding its product suite (e.g., ABC, non-traded BDCs) and geographical reach, with 80% of organic inflows focused on credit-oriented strategies. Marc Rowan highlighted a strategy to partner with traditional asset managers to access the broader retail market, integrating private assets into existing public portfolios rather than direct individual coverage.

    04

    Athene's Strong Performance and Outlook

    Athene generated $23 billion in organic inflows, pacing towards a record year, with net invested assets growing 18% YoY to $286 billion. Spread-related earnings (SRE) ex notables were $846 million. Management expects SRE ex notables to be approximately $880 million in Q4 FY25 and projects 10% SRE growth in FY26, driven by strong organic growth and origination. Athene has significantly reduced its sensitivity to floating rates and expects prepayment and COVID-era spread drag headwinds to dissipate.

    05

    Credit Quality and Risk Management

    Management reiterated its focus on disciplined underwriting, emphasizing senior secured, top-of-the-capital-structure investments. They view current credit market events as 'idiosyncratic, not systematic,' and highlighted Apollo's role as an origination principal rather than an agent. Marc Rowan addressed concerns about private letter ratings, stating Athene does not use Egan-Jones, and less than 8% of its assets are rated by Kroll or DBRS, with 70% having 2+ ratings from major agencies.

    06

    Innovation and Market Evolution

    Apollo is focused on innovation across its asset management franchise, including market making, leveraged share classes for evergreen funds, and reinvention of the CLO market. The firm is investing in infrastructure and business processes to embrace transparency, daily NAV capabilities, and liquidity solutions to facilitate broader adoption of private assets by traditional asset managers and in new channels like 401(k)s.

    AI-generated summary of the company’s earnings call. Not investment advice.