Asked how ARS is billed, specifically if it's at value at the beginning of each quarter or month.

Michael Sacks clarified that ARS fees are primarily billed quarterly in advance, based on the AUM number at the beginning of the quarter. “For the most part in ARS, it's quarterly. Fees are quarterly in advance based on the beginning quarter AUM number.”

Asked about the source of the "exciting momentum" in the franchise and where the greatest lift is expected.

Michael Sacks highlighted broad-based enthusiasm across the business, including insurance efforts, individual investor channels, and the credit platform, noting that the positive Q2 results were strong even without the full revenue impact of the SpaceX gains. Jon Levin added that H2 fundraising is expected to exceed H1, based on pipeline strength. “But it is really we are doing well. And this would have been a good, upbeat, positive call without the SpaceX conversation. And the reality is the SpaceX IPO and the increase in value in Q2 didn't really impact revenue at all yet so in Q2.”

Asked about the line of sight on realization opportunities and the carry payout ratio/overall firm payout ratio.

Michael Sacks stated the firm has historically held about 50% of the firm's share of incentive fees, but sees potential to hold more over time with increased carry cash flow or extraordinary ARS performance fees. He noted improving transaction activity in co-invest portfolios as a positive sign for realizations, and that the value of the unrealized carry asset continues to grow, with a lift expected next quarter from Q2 valuations rolling through. “We've maintained, you know, roughly, I think, for 50% margin, I think, where the firm holds, you know, 50% of the firm share of the incentive fees for a long time.”

GCMG

GCM Grosvenor (GCMG) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Financials· Aug 10, 2026

Source: earnings call transcript

Executive summary

GCM Grosvenor Q2 FY26 — Strong Fundraising and Investment Performance, Driven by Credit and ARS

GCM Grosvenor delivered a strong second quarter, marked by robust fundraising across diverse channels and solid investment performance, particularly in Absolute Return Strategies and private markets. The firm continues to expand its credit platform and individual investor/insurance channels, while managing expenses to drive margin expansion. Management remains confident in achieving long-term profitability targets, supported by a full fundraising pipeline and significant embedded incentive earnings.

Highlights

AUM and Fee-Paying AUM increased by approximately 13% year-over-year to $97 billion and $78 billion, respectively.
Q2 fundraising increased to $2.3 billion, up from $1.5 billion in Q1, bringing H1 fundraising to $3.9 billion.
Fee-related revenue grew by 11% YoY to $111 million.
Fee-related earnings (FRE) grew by 21% YoY to $50 million, achieving a 45% FRE margin.
Adjusted net income grew by 22% YoY.

Concerns

Realizations in private markets are not yet "firing on all cylinders," though an improvement is expected.
Unrealized incentive fees are subject to variability due to SpaceX share price movements, with each $10 movement worth about $4 million of performance fees.
No material catch-up fees are expected in the second half of the year.

Guidance & targets

Category	Target	Timeline	Confidence
Fundraising	Exceed first half levels medium materiality	H2 FY26	High
Private Markets Management Fees growth	Mid-single digits medium materiality	Q3 · FY26	High
ARS Management Fees growth (sequential)	Approximately 10% sequentially medium materiality	Q3 · FY26	High
ARS Management Fees growth (YoY)	Nearly 20% year over year medium materiality	Q3 · FY26	High
FRE Compensation and Benefits	Approximately $1 million higher medium materiality	Q3 · FY26	High
Non-GAAP General Administrative and Other Expenses	Relatively consistent with Q2 medium materiality	Q3 · FY26	High

Segment performance

Segment	Revenue	YoY	QoQ	Margin
Private Markets Management fees increased 10% year over year. Private equity, infrastructure, real estate, and private credit all delivered positive quarter-over-quarter performance. Investment performance: positive QoQFundraising contribution: significant	—	10%	—	—
Absolute Return Strategies (ARS) Management fees increased 11% year over year. Strong investment performance combined with positive net inflows drove a 22% year-over-year increase in ARS fee-paying AUM. Gross returns (inclusive of SpaceX): 14%Gross returns (exclusive of SpaceX): 10%Fee-paying AUM growth: 22% YoY	—	11%	—	—

Product announcements

Product	Type	Timeline	Details
Private Equity Registered Product	roadmap	some time

Deals & partnerships

N/A Successful close of inaugural credit secondaries fund. $1.2 billion

Raised across the flagship fund and related vehicles.

Longstanding institutional client Expanded relationship to accelerate deployment into credit co-investments.

Highly tailored solution enabling the client to pursue attractive opportunities.

Institutional investor Selected to design a customized program providing diversified exposure across private equity and private credit.

Solution leverages full tool set to best fit client needs.

Risks & headwinds

Deal activity and realizations in private markets are not yet "firing on all cylinders." Near-term

not yet firing on all cylinders

Mitigation:Management sees opportunity for a pickup in activity and acceleration of realizations, but precise timing is unpredictable. The firm has significant unrealized carry that will benefit from improvement.

Variability in unrealized incentive fees due to SpaceX share price movements. Second half of the year

Each additional $10 movement in SpaceX's share price is worth about $4 million of performance fees.

Mitigation:Management highlights the magnitude of the SpaceX success and the firm's conservative initial investment. The amount of performance fees ultimately realized will depend on ARS investment performance in H2.

Increased scrutiny around valuation, exposure to software categories, leverage levels, and liquidity in certain parts of the private credit market (e.g., direct lending). Current

relatively limited exposure to challenged areas

Mitigation:GCMG's exposure to these challenged areas is relatively limited. The firm's credit platform is highly diversified and flexible, identifying attractive opportunities across various strategies and geographies.

What to watch in Q3 FY26

Second half fundraising

H2 FY26

Current $3.9 billion (H1 FY26)

Target Exceed H1 levels

Why it matters

Indicates continued growth momentum and client demand across the platform.

We continue to expect second half fundraising to exceed the levels experienced in the first half and are pleased to report that our pipeline remains full.

Find out whether GCMG delivers this. Inve re-checks your case every morning.

Q&A highlights

Asked about the SpaceX mark at year-end, the typical lift in marks before an IPO, and if this trend could be expected for other high-profile IPOs in the pipeline.

Michael Sacks stated that SpaceX is unique and its valuation trajectory should not be projected onto other IPOs. He noted the tremendous movement in valuation and financials for SpaceX, but cautioned against using it as a template.

“SpaceX, sort of everything about it is a little bit one-on-one, and I wouldn't look to put that onto anything and I think you just gotta, you know, see how it all rolls forward.”

asked by Christoph Kotowski · answered by Michael Sacks

2 min read 5 chapters

Detailed narrative

SpaceX Investment Success

GCM Grosvenor highlighted its significant investment in SpaceX, totaling approximately $150 million at an average cost of $6.37 per share. As of the week prior to the call, these investments were valued at approximately $3.5 billion, split between ARS and private market portfolios, representing the largest single-issuer gain in the firm's history.

While gains are unrealized and subject to lockup, this investment exemplifies the firm's origination platform and ability to bring quality opportunities to investors.

Credit Platform Growth and Differentiation

The credit platform is a fast-growing and important differentiator, managing nearly $18 billion of assets. It was the largest contributor to Q2 fundraising, raising over $900 million, doubling Q1's amount. The firm successfully closed its inaugural credit secondaries fund at $1.2 billion, viewing it as a significant growth opportunity given the vast credit markets.

The platform's highly diversified and flexible approach, spanning primary funds, co-investments, secondaries, and direct transactions, resonates with clients seeking tailored solutions.

Individual Investor and Insurance Channel Expansion

Both individual investor and insurance channels were significant drivers of fundraising, representing 23% and 18% of year-to-date fundraising, respectively, despite starting the year with smaller AUM proportions (5% and 4%). These channels are strategic focus areas, with the firm actively developing registered products for infrastructure, absolute return, and a forthcoming private equity offering to meet diverse client needs.

Operating Leverage and Margin Expansion

The firm emphasized its significant operating leverage, with sourcing capacity exceeding current investment pace, allowing for scaling activity without sacrificing selectivity. This, combined with disciplined expense management and investments in technology like AI, is expected to further expand FRE margins over time. The FRE margin for Q2 was 45%, and the firm remains confident in achieving its long-term profitability targets.

Realization Environment and Unrealized Carry

While deal activity and realizations in private markets are not yet "firing on all cylinders," management sees an opportunity for a pickup, though timing is unpredictable. The firm holds a high ratio of firm unrealized carry ($493 million attributable to the firm's share) relative to its market cap, indicating significant upside to earnings as the realization environment improves.

The Q2 unrealized carry balance will reflect valuations as of June 30th, with SpaceX exposure expected to provide a meaningful lift.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.