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    GCMG
    Earnings call· Jun 2026(Q2 FY26)

    GCM Grosvenor Q2 FY26 earnings call GCMG

    Aug 10, 2026 Source

    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

    5

    • 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

    3

    • 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

    6
    CategoryTargetConfidence
    Fundraising
    Exceed first half levels
    medium materiality
    High
    Private Markets Management Fees growth
    Mid-single digits
    medium materiality
    High
    ARS Management Fees growth (sequential)
    Approximately 10% sequentially
    medium materiality
    High
    ARS Management Fees growth (YoY)
    Nearly 20% year over year
    medium materiality
    High
    FRE Compensation and Benefits
    Approximately $1 million higher
    medium materiality
    High
    Non-GAAP General Administrative and Other Expenses
    Relatively consistent with Q2
    medium materiality
    High

    Segment performance

    2
    SegmentRevenueYoYQoQMargin
    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%——

    Operational metrics

    31
    Assets Under Management (AUM)
    $97 billionup approximately 13% from a year ago
    Q2 FY26

    Firm-wide AUM.

    Fee-Paying Assets Under Management (FPAUM)
    $78 billionup approximately 13% from a year ago
    Q2 FY26

    Firm-wide FPAUM.

    Contracted Not Yet Fee-Paying AUM
    $9.7 billionup 11% from a year ago
    Q2 FY26

    Provides a strong foundation for continued organic growth.

    Fundraising
    $2.3 billionfrom the first quarter's $1.5 billion
    Q2 FY26

    Increased from Q1, with broad-based contributions.

    Fundraising
    $3.9 billion
    H1 FY26

    Total fundraising for the first half of the fiscal year.

    Fundraising contribution
    23%against the 5% of AUM they represented respectively at the start of the year
    YTD FY26

    Significant driver of fundraising.

    Fundraising contribution
    18%against the 4% of AUM they represented respectively at the start of the year
    YTD FY26

    Significant driver of fundraising.

    Fee-Related Revenue
    $111 millionincrease of 11% year-over-year
    Q2 FY26

    Reflects solid management fee growth across private markets and ARS.

    Fee-Related Earnings (FRE)
    $50 milliongrowth of 21% year over year
    Q2 FY26

    Strong growth driven by revenue and expense management.

    FRE Margin
    45%
    Q2 FY26

    Reflects significant scalability embedded in the business.

    Adjusted Net Income Growth
    22%as compared to the second quarter of 2025
    Q2 FY26

    Year-over-year growth.

    ARS Multi-Strategy Composite Gross Returns
    14%
    Q2 FY26

    Strong performance for the quarter.

    ARS Multi-Strategy Composite Gross Returns
    10%
    Q2 FY26

    Still very strong performance.

    ARS Multi-Strategy Composite Gross Returns
    15%
    YTD FY26

    Year-to-date performance.

    ARS Multi-Strategy Composite Gross Returns
    11%
    YTD FY26

    Year-to-date performance.

    Credit Platform AUM
    $18 billion
    Q2 FY26

    One of the fastest growing areas of the business.

    Credit Strategies Fundraising
    $900 milliondoubling what we raised in Q1
    Q2 FY26

    Largest contributor to Q2 fundraising.

    Credit Strategies Fundraising
    $1.4 billion
    H1 FY26

    Part of the $3.9 billion total H1 fundraising.

    Annual Investment Opportunities Reviewed
    1,400
    Annual

    Spanning virtually every corner of the private credit market.

    FRE Compensation and Benefits
    $38 million
    Q2 FY26

    Total for the quarter.

    Non-GAAP General Administrative and Other Expenses
    $22 million
    Q2 FY26

    In line with expectations.

    Annual Performance Fees Earned
    $7 million
    H1 FY26

    Earned in the first half of the year.

    Unrealized Annual Performance Fees
    $35 million to $40 million
    Q2 FY26

    Estimated based on recent ARS investment performance. Each additional $10 movement in SpaceX's share price is worth about $4 million of performance fees.

    Gross Unrealized Carried Interest
    $965 million
    Q2 FY26

    Firm-wide.

    Firm's Share of Unrealized Carried Interest
    $493 million
    Q2 FY26

    Attributable to the firm.

    Quarterly Dividend
    12 cents
    Q2 FY26

    Maintained.

    Shares Repurchased
    1.6 million
    Q2 FY26

    Actively managing dilution.

    Remaining Buyback Authorization
    $55 million
    Q2 FY26

    Available for future repurchases.

    SpaceX Investment Cost
    $150 million
    Historical

    Total investment in SpaceX across various portfolios.

    SpaceX Investment Value
    $3.5 billion
    Last week (prior to call)

    Current market value of SpaceX investments.

    SpaceX Mark in Unrealized Carried Interest
    $84
    Q2 FY26

    Mark used for SpaceX exposure in Q2 unrealized carried interest, reflecting a one-quarter lag.

    Industry KPIs

    4
    MetricValueDetails
    Fundraising inflows$2.3 billionUSD
    Performance revenue$7 millionUSD
    Fee related earnings$50 millionUSD
    Deployment realizations—

    Product announcements

    1
    ProductTypeDetails
    Private Equity Registered Productroadmap

    Deals & partnerships

    3
    N/ASuccessful close of inaugural credit secondaries fund.$1.2 billion

    Raised across the flagship fund and related vehicles.

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

    Highly tailored solution enabling the client to pursue attractive opportunities.

    Institutional investorSelected 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

    3
    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

    5

    Second half fundraising

    H2 FY26
    Current$3.9 billion (H1 FY26)
    TargetExceed 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.

    Q&A highlights

    6

    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 read5 chapters

    Detailed Narrative

    01

    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.

    02

    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.

    03

    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.

    04

    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.

    05

    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.

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