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    OWL
    Earnings call· Mar 2026(Q1 FY26)

    BLUE OWL CAPITAL Q1 FY26 earnings call OWL

    Apr 30, 2026 Source

    Executive summary

    Blue Owl Capital Q1 FY26 — Strong Fundraising and Resilient Performance Amid Macro Uncertainty

    Blue Owl Capital delivered strong Q1 FY26 results, driven by diversified fundraising and resilient portfolio performance. The firm raised $11 billion in capital, with significant institutional inflows and continued demand for real asset strategies, which helped offset modest net outflows from non-traded BDCs. Management emphasized disciplined expense management, reaffirming its FRE margin target for the year, and highlighted the strength of its credit portfolios despite broader macro uncertainties and increased LTVs in software lending.

    Highlights

    6

    • Revenues increased by 13%, Fee-Related Earnings by 14%, and Distributable Earnings by 11% compared to Q1 FY25.

    • Raised $57 billion of capital over the last 12 months, the second highest since inception, and $11 billion in Q1 FY26, representing approximately 14% annualized on AUM.

    • FRE margin expanded to 58.4% for the quarter, up from 58.3% in FY25, with a path to achieve 58.5% for FY26.

    • AUM not yet paying fees increased to $30 billion, representing $350 million of expected annual management fees.

    • The Net Lease strategy returned 14.7% over the last 12 months, outperforming the FTSE REIT Index by over 1,100 basis points.

    • OCIC delivered a 9.1% annualized return over approximately 5 years, outperforming leveraged loans by more than 300 basis points, high-yield bonds by more than 500 basis points, and traditional fixed income by more than 900 basis points.

    Concerns

    3

    • Net outflows of approximately $170 million from OCIC and OTIC (non-traded BDCs), representing less than 6 basis points of beginning of period AUM.

    • Elevated industry-wide redemption requests in private credit, though the actual impact to Blue Owl's revenues and earnings was modest.

    • LTVs in software lending increased from the low 30s to the low 40s, reflecting a modest tick-up due to public market valuation shifts.

    Guidance & targets

    8
    CategoryTargetConfidence
    FRE Margin
    58.5%
    high materiality
    High
    Dividend per share
    $0.92
    high materiality
    High
    Net Lease Fund VI Hard Cap
    $7.5 billion
    medium materiality
    High
    Net Lease Fund VI Capital Called
    Virtually fully called
    medium materiality
    High
    Digital Infrastructure Fund (next vintage) Initial Close
    Initial close
    medium materiality
    High
    FRE Growth
    Beat Visible Alpha consensus
    high materiality
    High
    Business Combination Stock-Based Comp
    Winds down to $0
    medium materiality
    High
    Payout Ratio Target
    85%
    high materiality
    Medium

    Segment performance

    3
    SegmentRevenueYoYQoQMargin
    Credit
    Strong fundraising across diverse credit products, including non-traded BDCs, GP-led secondaries, and alternative credit. Spreads are widening in the origination pipeline, creating attractive investment opportunities. Portfolios continue to behave in line with discipline, with no meaningful adverse movement in watch list, nonaccruals, amendment requests, or revolver draws. The average annual loss rate remains very low.
    Equity Capital Raised Q1: $4 billionEquity Capital Raised Q1 (non-traded BDCs): ~$1 billionEquity Capital Raised Q1 (GP-led secondaries): >$0.5 billionEquity Capital Raised Q1 (alternative credit): >$0.5 billionEquity Capital Raised Q1 (liquid and IG credit): >$0.5 billionGP-led Secondaries Fund (BOSE) Final Close: ~$3 billion (above target)Alternative Credit Opportunities Fund (ASOF IX) Final Close: ~$3 billion (above target)Last 12-month Gross Originations: $39.4 billionLast 12-month Net Originations: $8.2 billionRepayments Q1: $6.4 billionRepayments FY25: >$27 billionOrigination Pipeline Spreads: At least 50 basis points widerAverage Annual Loss Rate: 12 basis pointsAverage Borrower LTM Revenue and EBITDA Growth: Mid- to high single digitsTech Lending LTM Revenue and EBITDA Growth: High single-digit to low double-digit rangeAverage LTV across platform Q1: Low 40sTech Lending LTV Q1: Low 40s (up from low 30s)OCIC Annualized Return Since Inception (5 years): 9.1%Alternative Credit Gross Returns LTM: 11%Other Credit Strategies Deployment Gross Q1: $2.8 billion
    		————
    Real Assets
    Significant growth in AUM, particularly in Net Lease. Strong fundraising, with Net Lease contributing a substantial portion of equity capital raised. Deployment accelerated significantly, supported by build-to-suit projects and new commitments. Both net lease and digital infrastructure pipelines are robust, indicating continued demand for income-oriented returns backed by mission-critical assets.
    AUM: $85 billionNet Lease AUM Growth YoY: 38%Equity Capital Raised Q1: $3 billion (out of $4 billion total for platform)Net Lease Strategy Return LTM: 14.7%Deployment LTM: ~$20 billion (up >100% YoY)Net Lease Fund VI Capital Raised: $5.8 billion (towards $7.5 billion hard cap)Net Lease Fund VI Capital Called: 2/3 (expected fully called by summer)Net Lease Pipeline: $50 billion (transaction volume)Digital Infrastructure Pipeline: >$100 billionDigital Infrastructure Fund III Capital Called: >75% (one year after final close)ORENT Inflows Q1: $1.1 billionORENT Gross Repurchases Q1: <$134 millionORENT Net Inflows Q1: ~$1 billion
    		—27%——
    GP Strategic Capital
    Strong fundraising in the flagship vehicle and co-invest. The platform has delivered outstanding results, with funds achieving top quartile DPI. The pipeline for deployment remains robust, with the latest flagship fund already 40% committed.
    Equity Capital Raised Q1: $900 millionSixth Vintage Total Raised (inclusive of co-invest): Approaching $10 billionNet IRRs across Funds III, IV, V: 10% to 34%Latest Flagship Fund Committed: ~40% on target
    		————

    Operational metrics

    58
    Revenues
    13%YoY increase
    Q1 FY26

    Firm-wide revenue growth.

    Fee-Related Earnings (FRE)
    14%YoY increase
    Q1 FY26

    Firm-wide FRE growth.

    Distributable Earnings (DE)
    11%YoY increase
    Q1 FY26

    Firm-wide DE growth.

    FRE Margin
    58.4%Up from 58.3% in FY25
    Q1 FY26

    Modest expansion in FRE margin.

    Dividend per share
    $0.23
    Q1 FY26

    Declared dividend for the quarter, payable May 27 to holders of record as of May 13.

    Capital Raised
    $57 billion
    LTM

    Second highest capital raise since inception.

    Capital Raised
    $11 billionApproximately 14% annualized on AUM at end of 2025
    Q1 FY26

    Broad fundraising across platforms.

    AUM not yet paying fees
    $30 billion
    Q1 FY26

    Represents embedded growth opportunity once deployed.

    Institutional Capital Raised
    $6.1 billion
    Q1 FY26

    Strong institutional interest across platforms.

    Private Wealth Equity Raised
    $3 billion
    Q1 FY26

    Primarily across net lease, direct lending, alternative credit, and digital infrastructure.

    Real Assets Flows from Wealth
    $7 billion2.5x increase from prior 12-month period
    LTM

    Solid demand for real asset strategies in the wealth channel.

    Direct Lending AUM
    37%
    Q1 FY26

    Percentage of total Blue Owl AUM.

    Real Assets AUM
    27%
    Q1 FY26

    Percentage of total Blue Owl AUM.

    GP Strategic Capital AUM
    22%
    Q1 FY26

    Percentage of total Blue Owl AUM.

    Digital Infrastructure AUM
    6%
    Q1 FY26

    Percentage of total Blue Owl AUM.

    Equity Capital Raised outside Direct Lending
    Nearly 3/4
    LTM

    Highlights diversification of fundraising efforts.

    Alternative Credit and Net Lease AUM Growth
    Roughly 40%
    YoY

    Reflects strong interest in these asset classes.

    Net Outflows from OCIC and OTIC
    $170 millionLess than 6 basis points of beginning of period AUM
    Q1 FY26

    Modest impact from elevated industry-wide redemption requests. These funds comprise less than 17% of total AUM.

    ORENT Gross Repurchases
    Less than $134 million
    Q1 FY26

    Lowest percent repurchase quarter in 7 quarters for the non-traded REIT.

    ORENT Inflows
    $1.1 billion
    Q1 FY26

    Strong inflows for the non-traded REIT.

    ORENT Net Inflows
    Approximately $1 billion
    Q1 FY26

    Compared to about $8 billion of fee-paying AUM at the end of 2025.

    Direct Lending Gross Returns
    8.5%
    LTM

    Resilient performance for direct lending strategy.

    OCIC Annualized Return Since Inception
    9.1%Outperformed leveraged loans by >300 bps, high-yield bonds by >500 bps, traditional fixed income by >900 bps
    Since inception (approx. 5 years)

    Demonstrating durability across a range of market environments.

    Alternative Credit Gross Returns
    11%Outperformed leveraged loans by >600 bps
    LTM

    Compared favorably to leveraged loans.

    Net Lease Strategy Returns
    14.7%Outperformed FTSE REIT Index by >1,100 bps
    LTM

    Strong performance for the net lease strategy.

    GP Minority Stakes Net IRRs
    10% to 34%
    Across Funds III, IV, and V

    Outstanding results, top quartile of DPI.

    Credit Equity Capital Raised
    $4 billion
    Q1 FY26

    Breakdown of credit fundraising in Q1.

    GP-led Secondaries Fund (BOSE) Final Close
    Approximately $3 billion
    Q1 FY26

    Strong outcome for a first-time fund.

    Alternative Credit Opportunities Fund (ASOF IX) Final Close
    Approximately $3 billion
    Q1 FY26

    Strong outcome for the fund.

    Direct Lending Gross Originations
    $39.4 billion
    LTM

    Gross originations in direct lending.

    Direct Lending Net Originations
    $8.2 billion
    LTM

    Net originations in direct lending.

    Direct Lending Repayments
    $6.4 billion
    Q1 FY26

    Significant liquidity from repayment activity in direct lending funds.

    Direct Lending Repayments
    Over $27 billion
    FY25

    Significant liquidity from repayment activity in direct lending funds.

    Direct Lending Origination Pipeline Spreads
    At least 50 basis points wider
    Q1 FY26

    Reflects attractive investment opportunities in the origination pipeline.

    Average Annual Loss Rate (Direct Lending)
    12 basis points
    Q1 FY26

    Very low average annual loss rate, contributing to outperformance.

    Average Borrower LTM Revenue and EBITDA Growth
    Mid- to high single digits
    LTM

    Healthy underlying portfolio company growth across diversified lending.

    Tech Lending LTM Revenue and EBITDA Growth
    High single-digit to low double-digit range
    LTM

    Higher growth compared to overall diversified lending portfolio.

    Average LTV across Platform
    Low 40s
    Q1 FY26

    Modestly ticked up, still illustrating meaningful equity cushion.

    Tech Lending LTV
    Low 40sUp from low 30s
    Q1 FY26

    Reflects moves in public comps and broad-based spread widening, but still a significant equity cushion.

    Other Credit Strategies Deployment (Gross)
    $2.8 billion
    Q1 FY26

    Deployment across other credit strategies.

    Real Assets Deployment
    Approximately $20 billionIncreased >100% YoY
    LTM

    Supported by build-to-suit projects in net lease and new commitments in digital infrastructure.

    Net Lease Fund VI Capital Raised
    $5.8 billion
    Q1 FY26

    Approaching hard cap for the latest vintage of the net lease flagship fund.

    Net Lease Pipeline
    $50 billion
    Q1 FY26

    Transaction volume under letter of intent or contract to close, remaining around all-time highs.

    Digital Infrastructure Pipeline
    Over $100 billion
    Q1 FY26

    Substantial pipeline in digital infrastructure.

    Digital Infrastructure Fund III Capital Called
    Over 75%
    Q1 FY26

    Capital called just a year after its final close.

    Real Assets AUM
    $85 billionUp 27% over last year
    Q1 FY26

    Growth in the real assets platform.

    Net Lease AUM
    Up 38%
    YoY

    Strong year-over-year growth in net lease AUM.

    GP Strategic Capital Raised
    $900 million
    Q1 FY26

    Primarily in flagship vehicle and co-invest.

    GP Strategic Capital Sixth Vintage Total Raised
    Approaching $10 billion
    Q1 FY26

    Total raised for the sixth vintage, including co-invest.

    GP Strategic Capital Latest Flagship Fund Committed
    About 40%
    Q1 FY26

    Committed on target for the latest flagship fund.

    BOSE One-time Catch-up Fees
    Approximately $7 million
    Q1 FY26

    Contributed to the increase in credit fee rates.

    OWLCX AUM
    Approximately $2.5 billion
    Q1 FY26

    AUM for the interval fund, noted as the smallest of the scaled products.

    OWLCX Return
    11%
    First year

    Performance for the alternative credit product.

    OTIC Return
    2.3%
    Q1 FY26

    Performance for the newly launched fund.

    Net Lease Europe Fund Raised
    About $1.25 billion
    Q1 FY26

    First-time fund that has already hit its original fundraising goal.

    Real Estate Credit and Data Center Credit Funds Target
    About $1 billion
    FY26

    Combined fundraising target for these two first-time funds, expected to be exceeded this year.

    GP Stakes VI Fund Raised
    About $9 billion
    Q1 FY26

    Approaching the close of fundraising for this flagship fund this year.

    Stock-Based Comp Other Line Guidance
    $365 millionUpper teens growth
    FY26

    In line with previous guidance for the full fiscal year.

    Industry KPIs

    5
    MetricValueDetails
    Payout ratiocoming down naturallydirectional
    Fundraising inflows$11 billionUSD
    Performance revenue10% to 34%%
    Fee related earnings$0.25USD per share
    Deployment realizations$2.8 billionUSD

    Product announcements

    2
    ProductTypeDetails
    BOSE (GP-led secondary strategy)milestone
    ASOF IX (Alternative Credit Opportunities Fund)milestone

    Deals & partnerships

    2
    Amazon, STACK InfrastructureInvestment in a $12 billion data center campus$12 billion

    Amazon announced a $12 billion data center campus with investment for Blue Owl's digital infrastructure funds and development by STACK Infrastructure.

    AtlasInvestment into a leading investment platform

    In March, Blue Owl made an investment into Atlas, an investment platform with an owner-operator model in the industrial, manufacturing, and distribution space.

    Risks & headwinds

    4
    Geopolitical uncertainty and interest rate volatilityNear-term

    Compared to the last quarter, there's certainly more uncertainty in the macro and geopolitical landscape and investors across all asset classes are faced with more questions than answers about the near-term environment.

    Mitigation: Blue Owl's durable capital base and patient capital tend to favor private players during periods of heightened volatility and uncertainty, leading to market share gains.

    Elevated industry-wide redemption requests in private creditQ1 FY26

    Net outflows of approximately $170 million from OCIC and OTIC, which was less than 6 basis points of Blue Owl's beginning of period AUM.

    Mitigation: Redemption requests were primarily investor-led rather than advisor-led, indicating continued strong support from partners. Blue Owl's diversified product suite, including strong-performing non-direct lending products like ORENT (which saw net inflows of ~$1 billion), allows it to capture shifting sentiment.

    Software maturity wall and potential AI impact on software companies2028-2029 (maturity wall), ongoing (AI impact)

    LTVs in software lending increased from the low 30s to the low 40s, reflecting deterioration in software company valuations. Historical average principal recovery in problem cases is $0.80 on the dollar, with total recoveries of 1.1x to 1.2x.

    Mitigation: Blue Owl maintains a significant equity cushion (LTVs in the low 40s, implying ~60% equity cushion) beneath its senior secured positions. The firm is actively working down its exposure to software and expects private equity firms to inject equity to sustain companies facing refinancing needs.

    Softer environment in the wealth channel for non-traded BDCsRemainder of FY26

    Implied by management's discussion of continued softness in wealth and focus on disciplined expense management to maintain FRE margin.

    Mitigation: Blue Owl's diversified product suite, including strong-performing non-direct lending products like ORENT and OWLCX, helps mitigate the impact. The firm is focused on disciplined expense management to achieve its FRE margin target despite this headwind.

    What to watch in Q2 FY26

    5

    Net Lease Fund VI Hard Cap Achievement

    By end of FY26
    Current$5.8 billion raised
    Target$7.5 billion

    Why it matters

    Verifying the achievement of the hard cap for Net Lease Fund VI will indicate continued strong demand for real assets and successful fundraising execution, contributing to future AUM and fee growth.

    In total, we have reached $5.8 billion raised for the latest vintage of our net lease flagship and continue to expect to hit our hard cap of $7.5 billion by the end of this year.

    Q&A highlights

    9

    Can you provide more detail on the $6 billion institutional fundraising, specifically credit inflows, specific funds, fee rate dynamics, and sustainability?

    Inflows were seen across the credit platform, including ODL, non-traded BDCs (OCIC, OTIC), and alternative credit (ASOF IX). Institutions are increasingly recognizing the strong performance of direct lending and credit, making it an appealing investment area, especially with widening spreads.

    “We're noticing institutions, I think, are observing that direct lending and credit at large is actually working very, very well. And so in contrast perhaps to what is the sentiment in the air, if you will. I think institutions are actually seeing that this is an appealing time to look at credit.”

    asked by Craig Siegenthaler · answered by Marc S. Lipschultz

    2 min read6 chapters

    Detailed Narrative

    01

    Diversified Platform Growth

    Blue Owl's AUM is increasingly diversified, with direct lending now constituting only 37% of total AUM. Real assets and GP Strategic Capital platforms represent 27% and 22% respectively, demonstrating successful expansion beyond direct lending. Nearly three-quarters of equity capital raised over the last 12 months originated from strategies outside direct lending, including alternative credit, net lease, and digital infrastructure, which have seen significant growth.

    02

    Robust Fundraising Momentum

    The firm raised $11 billion in capital during Q1 FY26, with institutional investors contributing two-thirds of total equity raised, or $6.1 billion. This included commitments from 33 new institutional clients and 14 existing investors expanding into new strategies. Private wealth channels added $3 billion, primarily directed towards real asset strategies, which experienced a 2.5x increase in flows over the last 12 months, highlighting broad investor interest across the platform.

    03

    Resilient Portfolio Performance

    Despite macro uncertainties, Blue Owl's portfolios across credit, real assets, and GP Strategic Capital continue to perform strongly. Direct lending strategies generated gross returns of 8.5% over the last 12 months, with OCIC delivering a 9.1% annualized return since inception. The average annual loss rate in direct lending remains low at 12 basis points, and underlying portfolio companies exhibit healthy mid-to-high single-digit revenue and EBITDA growth.

    04

    Strategic Digital Infrastructure Investments

    Blue Owl is a key player in the digital infrastructure sector, evidenced by its investment in a recently announced $12 billion data center campus with Amazon. This marks the fourth data center project exceeding $10 billion in less than 18 months, underscoring the substantial demand for data center capacity and the firm's strategic role in this high-growth area. The digital infrastructure pipeline alone exceeds $100 billion.

    05

    Credit Market Dynamics and Deployment

    Management noted that current market volatility🌐 is creating attractive investment opportunities in private markets, leading to spread widening of at least 50 basis points in the direct lending origination pipeline. While non-traded BDCs experienced modest net outflows of $170 million, the firm is observing a beneficial rotation from lower-spread to higher-spread products. Repayments in direct lending funds totaled $6.4 billion in Q1, providing significant liquidity for new deployments.

    06

    Managing Software Lending Exposure

    LTVs in software lending have increased from the low 30s to the low 40s, reflecting shifts in public market valuations. However, management emphasized the significant equity cushion, approximately 60%, beneath their senior secured positions. The firm is actively managing its exposure to software given future uncertainties, but highlighted historical principal recovery rates of 80% and total recoveries of 110-120% in past problem situations.

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