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    CG
    Earnings call· Mar 2026(Q1 FY26)

    Carlyle Group Q1 FY26 earnings call CG

    May 7, 2026 Source

    Executive summary

    Carlyle Group Q1 FY26 — Strong FRE, Record U.S. Buyout Realizations, and High Inflows

    Carlyle Group delivered a strong first quarter, marked by robust fee-related earnings and record U.S. buyout realizations, demonstrating momentum across its diversified platform. The firm attracted significant capital inflows and introduced an innovative capital solution for its next U.S. buyout fund, reinforcing confidence in its strategic targets despite a complex global backdrop. Management expects continued acceleration in fundraising and management fees.

    Highlights

    5

    • Fee-related earnings (FRE) reached $300 million with a 47% margin.

    • Record U.S. buyout realizations returned $7 billion to investors, more than 40% higher than the prior record set in 2021.

    • Attracted $13 billion of new capital inflows, including a record $6.8 billion in Carlyle AlpInvest.

    • Closed a first-of-its-kind investment solution anchored by a $5 billion commitment for the next vintage U.S. buyout fund.

    • Carlyle AlpInvest's total AUM reached a record $107 billion, up 20% year-over-year.

    Concerns

    3

    • Geopolitical uncertainty and splintering

    • Elevated redemptions in CTAC

    • Industry scrutiny on day-1 markups

    Guidance & targets

    7
    CategoryTargetConfidence
    Total Inflows
    $200 billion
    high materiality
    High
    Fee-Related Earnings (FRE)
    $1.9 billion
    high materiality
    High
    Distributable Earnings (DE) per share
    $6 or more per share
    high materiality
    High
    Management fees growth
    accelerate
    medium materiality
    High
    Fundraising
    really accelerate
    medium materiality
    High
    Transaction fees
    go up
    medium materiality
    Medium
    FRE growth
    mid- to high single-digit
    high materiality
    High

    Segment performance

    3
    SegmentRevenueYoYQoQMargin
    Carlyle AlpInvest
    FRE was higher year-over-year despite $13 million less in catch-up fees. Record AUM and inflows driven by broad-based institutional and wealth activity across secondaries, co-investment, and portfolio finance strategies. Next vintage funds expected to have first closings later this year.
    Total AUM: $107 billionTotal AUM growth YoY: 20%Quarterly Inflows: $6.8 billionNet Accrued Performance Revenues: $643 millionNet Accrued Performance Revenues growth YoY: 13%
    		———$68 million FRE
    Global Credit
    Management fees increased 6% while transaction fees were modestly lower. Quarterly inflows were led by a $1.5 billion first close of a new asset-backed finance fund. The underlying portfolio shows strong credit metrics, with direct lending nonaccrual rate of 1% and structured credit default rate of 50 bps, half the industry average.
    Management Fees: $147 millionManagement Fees growth: 6%Total AUM: $209 billionTotal AUM growth YoY: 5%Quarterly Inflows: $3.9 billionLTM Inflows: $25 billionDirect Lending Nonaccrual Rate: 1%Structured Credit Default Rate: 50 basis points
    		———$93 million FRE
    Global Private Equity
    FRE was in line with Q1 last year. Fundraising and realizations show strong momentum, including $5 billion in earmarked commitments for the next vintage U.S. buyout strategy. CP VII alone returned nearly $5 billion in proceeds. Expect to continue returning capital for several quarters before realizing carry from CP VII.
    Proceeds returned to U.S. buyout investors: $7 billionCP VII DPI: >70%CP VII Remaining Fair Value: ~$17 billion
    		———$140 million FRE

    Operational metrics

    25
    Distributable Earnings (DE)
    $327 million
    Q1 FY26

    null

    Distributable Earnings (DE) per share
    $0.89
    Q1 FY26

    null

    Fee-Related Earnings (FRE)
    $300 million
    Q1 FY26

    null

    Fee-Related Earnings (FRE) margin
    47%
    Q1 FY26

    null

    Fund management fees
    $545 millionup 4% year-over-year
    Q1 FY26

    Driven by continued growth in Carlyle AlpInvest and Global Credit.

    Fee-related performance revenues
    $45 million15% higher year-over-year
    Q1 FY26

    Driven by growth in Evergreen wealth strategies.

    Evergreen wealth strategies AUM
    $19 billion4x the level from 3 years ago
    Q1 FY26

    null

    Transaction fees
    $54 million
    Q1 FY26

    Expect to increase next quarter.

    Realized proceeds
    $12 billionthird best quarter ever
    Q1 FY26

    Reflects high quality of portfolio and prioritization of returning capital.

    Net realized performance revenue (NRPR)
    $21 millionlower year-over-year
    Q1 FY26

    Due to composition, most exits in funds not yet realizing carry (CP VII and CP VIII). Expect to increase over remainder of 2026.

    Deployment
    $10 billion
    Q1 FY26

    Includes $4 billion in private credit and nearly $4 billion in Carlyle AlpInvest.

    New capital inflows
    $13 billion
    Q1 FY26

    Strong start to the year.

    Global Credit inflows
    $25 billion
    LTM

    null

    Asset-backed finance strategy AUM
    $12 billionup more than 30% compared to last year
    Q1 FY26

    New closed-end strategy.

    Direct lending nonaccrual rate
    1%
    Q1 FY26

    Current rate.

    Direct lending inception-to-date loss rate
    8 basis points per annum
    inception-to-date (13 years)

    Over 13 years.

    Structured credit default rate
    50 basis pointshalf the industry average
    Q1 FY26

    null

    Balance sheet assets attributable to Carlyle shareholders
    $5 billion
    Q1 FY26

    null

    Balance sheet assets attributable to Carlyle shareholders per share
    $14
    Q1 FY26

    null

    Quarterly dividend per common share
    $0.35in line with quarterly level in 2025
    Q1 FY26

    Declared.

    Shares repurchased
    3.8 million
    Q1 FY26

    Totaling $205 million.

    Share repurchase authorization remaining
    $1.9 billion
    Q1 FY26

    null

    Diluted share count
    360 milliondown over the past year
    Q1 FY26

    null

    Dry powder
    $96 billionup 13% year-over-year
    Q1 FY26

    Record level.

    Global Credit management fees
    up 10%
    LTM

    null

    Industry KPIs

    4
    MetricValueDetails
    Fundraising inflows$13 billionUSD
    Performance revenue$45 millionUSD
    Fee related earnings$300 millionUSD
    Deployment realizations$12 billionUSD

    Deals & partnerships

    3
    BASFCarve-out of coatings business.$8 billion

    One of two large transactions announced.

    MAI Capital ManagementAcquisition of MAI Capital Management.$3 billion

    One of two large transactions announced.

    Several cornerstone investorsFirst-of-its-kind investment solution anchored by a $5 billion commitment for the next vintage U.S. buyout fund. Provides access to fund and liquidity solution.$5 billion

    Leverages Carlyle AlpInvest capabilities. Fundraising for the next U.S. Buyout Fund will launch later this year.

    Risks & headwinds

    3
    Geopolitical uncertainty and splinteringongoing

    explicitly unquantified

    Mitigation: Carlyle's diversified platform and deep sector expertise are well-positioned to navigate the environment.

    Elevated redemptions in CTAClast quarter, may persist for a little while

    elevated redemptions last quarter

    Mitigation: CTAC is highly diversified (over 900 names), marked daily, and offers long-term benefits. Messaging to advisors is getting through.

    Industry scrutiny on day-1 markupsrecent

    explicitly unquantified

    Mitigation: Carlyle's practice is to purchase asset pools closer to par, not deeply discounted aged assets. No change in practices and advisor engagement remains robust.

    What to watch in Q2 FY26

    5

    Transaction fees

    Q2 FY26
    Current$54 million in Q1 FY26
    Targetgo up

    Why it matters

    Indicates increased deal activity and contributes to fee revenue.

    In Q1, we generated $54 million in transaction fees, and we expect this to increase next quarter driven by the completion of several transactions that have already signed or closed.

    Q&A highlights

    6

    How was the $5 billion commitment for the next U.S. Buyout Fund originated, what are the dynamics of assets and funding, how have other LPs responded, and what are the financial implications for Carlyle, including fee structure for Fund IX?

    Harvey Schwartz explained the solution leverages Carlyle AlpInvest's solutions business to provide LPs with liquidity and increased U.S. buyout exposure. It's a cornerstone financing at full fees, with no impact on Fund VII/VIII, and ensures alignment through a subordinated equity portion. Other LPs have shown strong interest, indicating this is a direction for the industry.

    “For the firm, obviously, and the team, it's a good outcome because it's a cornerstone financing of $5-plus billion at full fees. There's no impact. The most important thing about putting this together was obviously solving for our LPs needs, but also ensuring that there was perfect alignment with the fund and the future fund raise.”

    asked by Alex Blostein · answered by Harvey Schwartz

    2 min read5 chapters

    Detailed Narrative

    01

    Macro Environment and Strategic Positioning

    The company highlighted a complex global backdrop characterized by geopolitical uncertainty🌐, national security concerns, and a focus on economic growth, reindustrialization, and onshoring. These trends are driving an increasing demand for private capital. Carlyle's diversified platform, spanning private equity, real assets, private and liquid credit, and Carlyle AlpInvest, along with deep sector expertise in areas like aerospace and defense, industrial, energy, and healthcare, positions it well to capitalize on these evolving investment opportunities.

    02

    Innovative Capital Solutions

    Carlyle announced a first-of-its-kind investment solution, securing a $5 billion commitment for its next vintage U.S. buyout fund. This innovative structure leverages Carlyle AlpInvest's capabilities in portfolio finance and secondaries to provide cornerstone investors with both access to the fund and a tailored liquidity solution. Management emphasized this as a 'win-win' for investors and Carlyle, reflecting a strategic evolution in client solutions and attracting significant interest from other LPs and GPs in the industry.

    03

    Capital Deployment and Realizations

    The quarter saw strong capital activity, with $12 billion in realizations, marking the third-best quarter ever and a record for U.S. buyout proceeds, exceeding the prior record by over 40%. Deployment totaled $10 billion, including $4 billion in private credit and nearly $4 billion in Carlyle AlpInvest. Notable announced transactions include an $8 billion carve-out of BASF's coatings business and a $3 billion acquisition of MAI Capital Management, both expected to close in the coming months⏳ and contribute to future transaction fee revenue.

    04

    Fundraising Momentum

    Carlyle attracted $13 billion in new capital inflows during the quarter, signaling a strong start to the year. Carlyle AlpInvest raised nearly $7 billion, driven by robust demand across secondaries, co-investment, and portfolio finance strategies. Global Credit raised $4 billion, including a $1.5 billion first close for a new asset-backed finance strategy, bringing LTM credit inflows to $25 billion. The firm anticipates an acceleration in fundraising across its platforms, entering a 'super cycle' for key strategies.

    05

    Credit Portfolio Health and Wealth Channel Strategy

    The Global Credit portfolio demonstrated strong credit metrics, with a direct lending nonaccrual rate of only 1% and an inception-to-date loss rate of 8 basis points per annum over 13 years. Structured credit default rates remained low at 50 basis points, half the industry average. In the wealth channel, Evergreen wealth strategies grew AUM to $19 billion, quadrupling in three years. Management addressed concerns regarding day-1 markups, affirming their practice of purchasing asset pools closer to par and noting robust advisor engagement despite elevated redemptions in CTAC.

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