ARES 10-K & 10-Q changes, risk factors and insider trading

•we may experience reputational harm if we fail to appropriately address conflicts of interest orinterest, if we, our employees, our funds or their portfolio companies fail (or are alleged to have failed) to comply with applicable regulations in an increasingly complex political and regulatory environment and as a result of negative publicity related to our various businesses and strategies;

•our growth strategy contemplates acquisitions and entering new lines of business and expanding into new investment strategies, geographic markets and businesses, which subject us to numerous risks, expenses and uncertainties, including related to the integration of developmentnew opportunities,businesses and strategies, acquisitions or joint ventures;

•security incidents or cyber-attackscyber-attacks, affecting us or our third-party service providers, could adversely affect our business, financial condition and operating results;

•we are subject to numerous privacy laws, and violation of such laws may subject us to significant fines or penalties, litigation, or reputational damage, and new privacy laws or changes in enforcement of existing privacy laws could impact our business and financial performance;

•increaseschanges in interest rates could negatively impact the values of certain assets or investments and the ability of our funds and their portfolio companies to access the debt markets on attractive terms, which could adversely impact investment and realization opportunities;

•a downturn in the global credit markets could adversely affect certain of our investments, including CLO investments and other liquid credit portfolios;

•due to our and our funds’ investments in certain market sectors, such as private credit, power, infrastructure and energy, real estateestate, insurance, secondaries and insurance,private equity products, we are subject to risks and regulations inherent to those industries;

Global financial markets have experienced heightened volatility in recent periods, including as a result of economic and political events in or affecting the world’s major economies, such as the ongoing war between Russia and Ukraine and conflicts in the Middle East. Sanctions imposed by the U.S. and other countriescountries, including on Iran and in connection with hostilities between Russia and Ukraine and the tensions between China and TaiwanTaiwan, have caused additional financial market volatility and affected the global economy. Concerns over future increases in inflation, economic recession, as well as interest rate volatility and fluctuations in oil and gas prices resulting from global production and demand levels, as well as geopolitical tension, have exacerbated market volatility. Market uncertaintyvolatility has been further exacerbated by social unrest, changes regarding immigration and volatilitywork havepermit alsopolicies beenand magnifiedother aspolitical aand resultsecurity concerns both in the U.S. and across various international regions. Because of interrelationships within the global financial markets, if these issues do not abate, worsen or spread, our business may be adversely affected both within and outside of the 2024directly U.S.affected presidential and congressional elections and resulting uncertainties regarding actual and potential shifts in U.S. and foreign, trade, economic and other policies, including with respect to treaties and tariffs. The United States has recently enacted and proposed to enact significant new tariffs, including on Mexican, Canadian and Chinese goods. Additionally, the new Presidential Administration has directed various federal agencies to further evaluate key aspects of U.S. trade policy and there has been ongoing discussion and commentary regarding potential significant changes to U.S. trade policies, treaties and tariffs.regions.

In addition, numerous structural dynamics and persistent market trends have exacerbated volatility and market uncertainty. Concerns over significant volatility in the commodities markets, sluggish economic expansion in foreign economies, including continued concerns over growth prospects in China and emerging markets, growing debt loads for certain countries, uncertainty about the consequences of the U.S. and other governments withdrawing monetary stimulus measuresmeasures, government agency closures, prolonged government shutdowns and speculation about a possible recession all highlight the fact that economic conditions remain unpredictable and volatile. U.S. debt ceiling and budget deficit concerns have increased the possibility of additional credit-rating downgrades and economic slowdowns or a recession in the U.S. In recent periods, geopolitical tensions, including between the U.S. and China, have escalated. Further escalation of such tensions and the related imposition of sanctions or other trade barriers may negatively impact the rate of global growth, particularly in China, where growth has slowed. Moreover, there is a risk of both sector-specific and broad-based volatility, corrections and/or downturns in the commodities, equity and credit markets. Any of the foregoing could have a significant impact on the markets in which we operate and a material adverse impact on our business prospects and financial condition. Further, while weak economic environments have often provided attractive investment opportunities and strong relative investment performance, we tend to realize value from our investments in times of economic expansion, when opportunities to sell investments may be greater. Thus, we depend on the cyclicality of the market to sustain our businesses and generate attractive risk-adjusted returns over extended periods.

A number of factors have had and may continue to have an adverse impact on credit markets in particular. The weakness and the uncertainty regarding the stability of the oil and gas markets resulted in a tightening of credit across multiple sectors. In addition, the Federal Reserve has decreased the federal funds rate multiple times in 2024.2025. Changes in and uncertainty surrounding interest rates may have a material effect on our business, particularly with respect to the cost and availability of financing for significant acquisition and disposition transactions. Moreover, whilemany conditionseconomies inoutside of the U.S. economy have generally improved since the credit crisis, many other economies continue to experience weakness, tighter credit conditions and a decreased availability of foreign capital. Since credit represents a significant portion of our business and ongoing strategy, any of the foregoing could have a material adverse impact on our business prospects and financial condition.

During periods of difficult market conditions or slowdowns (which may be across one or more industries, sectors or geographies), companies in which we and our funds invest may experience decreased revenues, financial losses, credit rating downgrades, difficulty in obtaining access to financing and increased funding costs. During such periods, these companies may also have difficulty in expanding their businesses and operations and be unable to meet their debt service obligations or other expenses as they become due, including expenses payable to us and our funds. In particular, while diversification is generally an objective of our funds, there can be no assurance as to the degree of diversification, if any, that will be achieved in any fund investments. Difficult market conditions or volatility or slowdowns affecting a particular asset class, geographic region, industry or other category of investment could have a significant adverse impact on a fund if its investments are concentrated in that area, which would result in lower investment returns. This lack of diversification may expose a fund to losses disproportionate to market declines in general if there are disproportionately greater adverse price movements in the particular investments. Negative financial results in our funds’ portfolio companies may reduce the value of their portfolio companies, the net asset value of our funds and the investment returns for our funds, which could have a material adverse effect on our operating results and cash flow. In addition, such conditions would increase the risk of default with respect to credit-oriented or debt investments. Our funds may be adversely affected by reduced opportunities to exit and realize value from their investments, by lower than expected returns on investments made prior to the deterioration of the credit markets and by our inability to find suitable investments for the funds to effectively deploy capital, which could adversely affect our ability to raise new funds and thus adversely impact our prospects for future growth.

We depend on the diligence, skill, judgment, business contacts and personal reputations of our executive officers, senior professionals and other key personnel depart.personnel. Our future success will depend upon our ability to retain our senior professionals and other key personnel and our ability to recruit additional qualified personnel. These individuals possess substantial experience and expertise in investing, are responsible for locating and executing our funds’ investments, have significant relationships with the institutions that are the source of many of our funds’ investment opportunities and, in certain cases, have strong relationships with our investors. Therefore, if any of our senior professionals or other key personnel depart and join competitors or form competing companies, it could result in the loss of significant investment opportunities, limit our ability to raise capital from certain existing investors or result in the loss of certain existing investors. There is no guarantee that the non-competition and non-solicitation agreements to which certain of our senior professionals and other key personnel are subject, together with our other arrangements with them, will prevent them from leaving, joining our competitors or otherwise competing with us. Such agreements also expire after a certain period of time, at which point such senior personnel would be free to compete against us and solicit our clients and employees. In addition, there is no assurance that such agreements will be enforceable in all cases, particularly as U.S. states and/or federal agencies enact legislation or adopt rules aimed at effectively prohibiting non-competition agreements.

The departure or bad acts of any of our senior professionals, or a significant number of our other investment professionals, could have a material adverse effect on our ability to achieve our investment objectives, cause certain of our investors to withdraw capital they invest with us or elect not to commit additional capital to our funds or otherwise have a material adverse effect on our business and our prospects. Turnover and associated costs of rehiring, the loss of human capital through attrition and the reduced ability to attract talent could impair our ability to implement our growth strategy and maintain our standards of excellence. Competition for qualified, motivated, and highly-skilled executives, professionals and other key personnel in investment management firms is significant, both in the U.S. and internationally, and we may not succeed in recruiting additional personnel or we may fail to effectively replace current personnel who depart with qualified or effective successors. Further the departure of some or all of those individuals could also trigger certain “key person” provisions in the documentation governing certain of our funds, which would permit the investors in those funds to suspend or terminate such funds’ investment periods or, in the case of certain funds, permit investors to withdraw their capital prior to expiration of the applicable lock-up date. We do not carry any “key person” insurance that would provide us with proceeds in the event of the death or disability of any of our senior professionals, and we do not have a policy that prohibits our senior professionals from traveling together. See “—Risks Related to Regulation—Employee misconduct and failure to comply with applicable laws, obligations and standards could harm us by impairing our ability to attract and retain investors and subjecting us to significant legal liability, regulatory scrutiny and reputational harm.”

As we expand the number and scope of our businesses, we increasingly confront potential conflicts of interest relating to our and our funds’ investment activities. These conflicts are most likely to arise between or among our funds or between one or more funds across our Credit, Real Assets, Secondaries and Private Equity and Secondaries Groups, and other businesses including any SPACs and similar investment vehicles that we sponsor. These conflicts of interest include:

•our funds may invest in different parts of the capital structure of a company in which one or more of our other funds also invests. For example, one or more funds may invest in a controlling or other equity interest issued by a portfolio company in which a different fund holds debt securities. Additionally, in connection with an investment we may create multiple tranches of a capital structure and our funds may be allocated investments in these tranches on terms established by us. The interests of our funds may not always be aligned, which may give rise to actual or potential conflicts of interest, or the appearance of conflicts of interest. Further, a direct conflict of interest could arise between the security holders if such a company were to become distressed or develop insolvency concerns. Actions taken for one or more of our funds may be adverse to us or other of our funds;

•certain funds in different groups may invest alongside each other in the same security. For example, ARCC,our ASIFBDCs and certainthe other registered closed-end management investment companies managed by us are permitted to co-invest in portfolio companies with each other and with other affiliated fundsinvestment entities pursuant to an SEC order (the “Co-Investment Exemptive Order”)., subject to compliance with certain conditions and other requirements. The different investment objectives or terms of such funds may result in a potential conflict of interest, including in connection with the allocation of investments between the funds made pursuant to the Co-Investment Exemptive Order;

Though we believe we have appropriate means and oversight to resolve these conflicts, our judgment on any particular allocation could be challenged. While we have developed general guidelines regarding when two or more funds can invest in different parts of the same company’s capital structure and created a process that we employ to handle such conflicts if they arise, our decision to permit the investments to occur in the first instance or our judgment on how to minimize the conflict could be challenged. Further, our employeesemployees, including our senior professionals, may make investments or have outside business activities which may conflict with investments made by our funds or prevent our funds from investing in an opportunity. If we fail to appropriately address any such conflicts, it could negatively impact our reputation and ability to raise additional funds and the willingness of counterparties to do business with us or result in potential litigation or regulatory action against us, which may adversely impact our business.

Certain funds in different groups may invest alongside each other in the same security. For example, ARCC,our ASIFBDCs and certainthe other registered closed-end management investment companies managed by us are permitted to co-invest in portfolio companies with each other and with other affiliated fundsinvestment entities pursuant to the Co-Investment Exemptive Order.Order, subject to compliance with certain conditions and other requirements. The different investment objectives or terms of such funds may result in a potential conflict of interest, including in connection with the allocation of investments between the funds made pursuant to the Co-Investment Exemptive Order. In addition, conflicts of interest may exist in the valuation of our investments and regarding decisions about the allocation of specific investment opportunities among us and our funds and the allocation of fees and costs among us, our funds and their portfolio companies. We, from time to time, incur fees, costs, and expenses on behalf of more than one fund. To the extent such fees, costs, and expenses are incurred for the account or benefit of more than one fund, each such fund will typically bear an allocable portion of any such fees, costs, and expenses in proportion to the size of its investment in the activity or entity to which such expense relates (subject to the terms of each fund’s governing documents) or in such other manner as we consider fair and equitable under the circumstances such as the relative fund size or capital available to be invested by such funds. Where a fund’s governing documents do not permit the payment of a particular expense, we will generally pay such fund’s allocable portion of such expense.

Potential conflicts will arise with respect to our decisions regarding how to allocate co-investment opportunities among us, our funds and investors and the terms of any such co-investments. Our fund documents typically do not mandate specific allocations with respect to co-investments. The investment advisers of our funds may have an incentive to provide co-investment opportunities to certain investors in lieu of others. Co-investment arrangements may be structured through one or more of our investment vehicles, and in such circumstances, co-investors will generally bear the costs and expenses thereof (which may lead to conflicts of interest regarding the allocation of costs and expenses between such co-investors and investors in our other funds). The terms of any such existing and future co-investment vehicles may differ materially, and in some instances may be more favorable to us, than the terms of certain of our funds or prior co-investment vehicles, and such different terms may create an incentive for us to allocate a greater or lesser percentage of an investment opportunity to such funds or such co-investment vehicles, as the case may be. Such incentives will from time to time give rise to conflicts of interest. There can be no assurance that any conflicts of interest will be resolved in favor of any particular funds or investors (including any applicable co-investors) and such investment fund or investor (or the SEC) may challenge our treatment of such conflict, which could impose costs on our business and expose us to potential liability.

Poor performance of our funds, or a failure ofor slowdown in deployment, would cause a decline in our revenue and results of operations and could adversely affect our ability to raise capital for future funds.

•returns on investments of our own capital in the funds and other investment vehicles, including SPACs,vehicles that we sponsor and manage.

In addition, if any of our subsidiaries become the sponsor of any SPACs that are unable to successfully complete a business combination within the time limitation provided for such SPAC, we may lose the entirety of our investment. See “—Risks Related to Regulation—Our investments in subsidiaries that have sponsored SPACs and invested in their business combination targets may expose us to increased liabilities, and we may suffer the loss of all or a portion of our investments if the SPAC does not complete a business combination by the applicable deadline or the target is unsuccessful.”

Our investment advisory and management agreement with ARCC renews for successive annual periods subject to the approval of ARCC’s board of directors or by the affirmative vote of the holders of a majority of ARCC’s outstanding voting securities. In addition, the agreement may be terminated by ARCC’s board of directors, the affirmative vote of the holders of a majority of ARCC’s outstanding voting securities (each as required by the Investment Company Act,Act) both ARCC andor its investment adviser have the right to terminate the agreement without penalty upon 60 days’ written notice to the other party. Termination or non-renewal of this agreement would reduce our revenues significantly and could have a material adverse effect on our financial condition.

We may not be able to maintain our current fee structure as a result of industry pressure from fund investors to reduce fees. Although our investment management fees vary among and within asset classes, historically we have competed primarily on the basis of our performance and not on the level of our investment management fees relative to those of our competitors. In recent years, however, there has been a general trend toward lower fees in the investment management industry. The Institutional Limited Partners Association (“ILPA”) published a set of Private Equity Principles (the “Principles”) which called for enhanced “alignment of interests” between general partners and limited partners through modifications of some of the terms of fund arrangements, including proposed guidelines for fee structures. We promptly provided ILPA with our endorsement of the Principles, representing an indication of our general support for the efforts of ILPA. Although we have no obligation to modify any of our fees with respect to our existing funds, we may experience pressure to do so. More recently, institutionalInstitutional investors have beencontinued increasing pressure to reduce management and investment fees charged by external managers, whether through direct reductions, deferrals, rebates or other means. In addition, we may be asked by investors to waive or defer fees for various reasons, including during economic downturns or as a result of poor performance of our funds. We may not be successful in providing investment returns and service that will allow us to maintain our current fee structure. Fee reductions on existing or future new businesses could have an adverse effect on our profit margins and results of operations. For more information about our fees, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

We intend, if market conditions warrant, to grow our businesses by increasing assets under management in existing businesses and expanding into new investment strategies, geographic markets, strategic partnerships and businesses. We may pursue growth through acquisitions of other investment management companies, acquisitions of critical business partners, acquisition of companies, or other strategic initiatives (including through our other businesses), which may include entering into new lines of business. In addition, consistent with our past experience, we expect opportunities will arise to acquire other alternative or traditional asset managers, including asset managers located outside of the U.S. We have in the past opened many offices to conduct our asset management and capital markets businesses around the world, including in Europe and APAC, which we intend to grow and expand. We have also launched a number of new investment initiatives in various asset classes and geographies, which subject us to additional risk. For example, in connection with the acquisition of Walton Street Capital Mexico S. de R.L. de C.V. and certain of its affiliates (“WSM”) (the “WSM Acquisition,Acquisition”) in 2024, we expanded our real estate capabilities into Mexico. Additionally, in connection with the acquisition of the international business of GLP Capital Partners Limited and certain of its affiliates, excluding its operations in Greater China (“GCP International”), and existing capital commitments to certain managed funds (the “GCP Acquisition”), which is expected to close in the first quarter of 2025, we expect to launchlaunched investment initiatives in Japan, Vietnam and Brazil. Each of these geographies may subject us to heightened risks due to jurisdictional limitations or political or economic uncertainty in these regions. See “—Investments in emerging markets are subject to greater risks than those in more developed markets.” Introducing new types of investment structures and products could increase the complexities involved in managing such investments, including ensuring compliance with applicable regulatory requirements and terms of the investment vehicles.

•our inability to realize the anticipated operation and financial benefits from an acquisition for a number of reasons, including if we are unable to effectively integrate acquired businesses and the potential departure of key investment professionals and employees or loss of relationships of the acquired businesses;

Entry into certain lines of business may subject us to new laws and regulations with which we are not familiar, or from which we are currently exempt, and may lead to increased litigation and regulatory risk. If a new business does not generate sufficient revenues or if we are unable to efficiently manage our expanded operations, our results of operations will be adversely affected. Our strategic initiatives may include joint ventures and business combinations through subsidiary sponsored SPACs,investment vehicles, in which case we will be subject to additional risks and uncertainties in that we may be dependent upon, and subject to liability, losses or reputational damage relating to systems, controls and personnel that are not under our control or disputes with our joint venture partners. Because we have not yet identified these potential new investment strategies, geographic markets or lines of business, we cannot identify all of the specific risks we may face and the potential adverse consequences on us and their investment that may result from any attempted expansion.

If we are unable to consummate or successfully integrate developmentnew opportunities,businesses and strategies, acquisitions or joint ventures, we may not be able to implement our growth strategy successfully.

AMC is a Delaware corporation. Unless the context otherwise requires, references to “Ares,” “we,” “us,” “our,” and the “Company” are intended to mean the business and operations of AMC and its consolidated subsidiaries. The following discussion analyzes the financial condition and results of operations of the Company. “Consolidated Funds” refers collectively to certain Ares funds, co-investment vehicles, structured financing vehicles, CLOs and SPACs that are required under generally accepted accounting principles in the United States (“GAAP”) to be consolidated within our consolidated financial statements included in this Annual Report on Form 10-K. Additional terms used by the Company are defined in the Glossary and throughout the Management’s Discussion and Analysis in this Annual Report on Form 10-K.

We believe our portfolios across all strategies areremain well positioned for a fluctuating interest rate environment. On a market value basis, approximately 85% of our debt assets and 57%52% of our total assets were floating rate instruments as of December 31, 2024.2025.

• Our ability to fundraise and increase AUM and fee paying AUM. During the year ended December 31, 2024,2025, we raised $92.7$113.2 billion of gross new capital across our commingled funds, SMAs, wealth products and other vehicles, and continued to expand our investor base, raising capital from over 185190 different investment vehicles and over 660540 institutional investors, including over 310235 direct institutional investors that were new to Ares. Our fundraising efforts helped drive AUM growth of 16%29% for 2024.2025. During 2025,2026, we expect that our fundraising will come from a combination of our existing and new strategies in Norththe America,Americas, Europe and APAC. As of December 31, 2024,2025, AUM not yet paying fees includes $81.0$78.8 billion of AUM available for future deployment whichand $4.3 billion of development assets not yet stabilized that could collectively generate approximately $728.8$730.4 million in potential incremental annual management fees. Our potential future deployment, the creation of new development assets and the stabilization of existing development assets, coupled with our future fundraising prospects, givescreates us theadditional opportunity to increase our management fees in 2025.2026.

• Our ability to attract new capital and investors with our broad multi-asset class product offering. Our ability to attract new capital and investors in our funds is driven, in part, by the extent to which they continue to see the alternative asset management industry generally, and our investment products specifically, as an attractive vehicle for capital appreciation and income generation. We continually seek to create avenues to meet our investors’ evolving needs by offering an expansive range of funds, developing new products and creating managed accounts and other investment vehicles tailored to our investors’ goals. We continue to expand our product offerings and distribution channelsrelationships throughout the wealth channel with our global wealth management offerings, as well as the needs of traditional institutional investors, such as pension funds, sovereign wealth funds and endowments. If market volatility persists or increases, investors may seek absolute return strategies that seek to mitigate volatility. We offer a variety of investment strategies depending upon investors’ risk tolerance and expected returns.

• Our disciplined investment approach and successful deployment of capital. Our ability to maintain and grow our revenue base is dependent upon our ability to successfully deploy the capital that our investors have committed to our funds. Greater competition, high valuations, cost of credit and other general market conditions have affected and may continue to affect our ability to identify and execute attractive investments. Under our disciplined investment approach, we deploy capital only when we have sourced a suitable investment opportunity at an attractive price. During the year ended December 31, 2024,2025, we deployed $106.7$145.8 billion of gross capital across our investment groups compared to $68.1$106.7 billion deployed in 2023.2024. We believe we continue to be well-positioned to invest our assets opportunistically. As of December 31, 2024,2025, we had $133.1$156.0 billion of capitaldry available for investmentpowder compared to $111.4$133.1 billion as of December 31, 2023.2024.

The chart below presents our perpetual capital AUM by segment and type ($ in billions):

We view the duration of funds we manage as a metric to measure the stability of our future management fees. For both the years ended December 31, 20242025 and 2023,2024, 95%93% and 95%, respectively, of management fees were earned from perpetual capital or long-dated funds.

The charts below present the composition of our segment management fees by the initial fund durationtype:

As of December 31, 2024,2025, AUM Notnot Yetyet Payingpaying Feesfees includes $81.0$78.8 billion of AUM available for future deployment and $4.3 billion of development assets not yet stabilized that could collectively generate approximately $728.8$730.4 million in potential incremental annual management fees, which represents 29%a 23% embedded grossgrowth rate in our 2025 base management fee growth upon deployment. As of December 31, 2023, AUM Not Yet Paying Fees included $62.9 billion of AUM available for future deployment that could generate approximately $621.6 million in potential incremental annual management fees.

Management Fees. The investment adviser of our funds generally receives an annual management fee based on a percentage of the fund’s capital commitments, contributedinvested capital, netNAV assetor the fair value or invested capital during the investment period, which may then change at the end of theassets, investmentamong period.others. For certain of our SMAs, we receive an annual management fee based on a percentage of invested capital, contributed capital or net asset valueNAV throughout the term of the SMA. We also may receive specialother fees, including agency and arrangement fees. In certain circumstances, we are contractually required to offset certain amounts of suchthese specialother fees against management fees relating to the applicable fund.

The management fees we receive from our drawdown style funds are typically payable on a quarterly basis over the life of the fund and do not fluctuate with the changes in investment performancevalue of the underlying investments within the fund. The investment management agreements we enter into with clients in connection with contractual SMAs may generally be terminated by such clients with reasonably short prior written notice. Typically, terminations do not require liquidation of theassets SMAsso and suchthat SMAs will continue to existpay fees until the underlying investments are liquidated. The management fees we receive from our SMAs are generally paid on a periodic basis (typically quarterly, subject to the termination rights described above) and are based on either invested capital or on the net asset value of the SMA.

Details regarding our management fees by strategy, excluding our publicly-traded funds and our perpetual wealth vehicles described above,separately, are presented below:

(6) Certain funds pay a lower management fee rate on committed capital which increases when such capital is invested. Following the expiration or termination of the investment period the basis on which management fees are earned for certain closed-end funds, managed accounts and co-investment vehicles in this strategy changes from committed capital to invested capital with no change in the management fee rate. Our diversified non-traded REIT and our industrial non-traded REIT pay management fees based on NAV plus net capital raised and outstanding from our 1031 exchange programs. In addition, certain real estate funds pay a management fee of 7.50% of net operating income. For these funds, we present an effective fee rate as a percentage of GAV.

Details regarding our fee related performance revenues from our publicly-traded funds and our perpetual wealth vehicles are presented below:

We are party to contractual expense limitation agreements with certain perpetual wealth vehicles under which we may advance a portion of certain expenses to reduce the perpetual wealth vehicles’ expense ratios. Such expenses are subject to reimbursement from the perpetual wealth vehicles and may result in a corresponding reduction to our fee related performance revenues until the expenses have been recovered.

Details regarding our fee related performance revenues by strategy, excluding our publicly-traded funds and our perpetual wealth vehicles described above, are presented below:

(1) We may receive Part II Fees,Fees from certain publicly-traded funds and perpetual wealth vehicles, which are not paid unless ARCC,these ASIF, our open-ended European direct lending fund and our infrastructure private BDCfunds achieve cumulative aggregate realized capital gains (net of cumulative aggregate realized capital losses and aggregate unrealized capital depreciation), subject to certain catch-up provisions. Incentive fees from ARCC represent 20.0% of the cumulative aggregate realized capital gains (net of cumulative aggregate realized losses and aggregate unrealized capital depreciation). For ASIF, our open-ended European direct lending fund, and for our infrastructure private BDC, incentive fees represent 12.5% of the cumulative aggregate realized capital gains (net of cumulative aggregate realized losses and aggregate unrealized capital depreciation). Such fees are presented as incentive fees earned from funds with stated investment periods.

Funds generally follow either an American-style waterfall or a European-style waterfall. For American-style waterfalls, we in our role as general partner are entitled to receive carried interest after a fund investment is realized if the investors in the fund have received distributions in excess of the capital contributed for such investment and all prior realized investments (plus allocable expenses), as well as the preferred return. For European-style waterfalls, we in our role as general partner are entitled to receive carried interest if the investors in the fund have received distributions in an amount equal to all prior capital contributions (plus allocable expenses), as well as a preferred return.

Performance Income. Performance income is a term that we use to refer to a sub-set of performance-based fees and onlyincludes includesboth carried interest and incentive fees earned from funds with stated investment periods orand carriedexcludes interest.fee related performance revenues.

Administrative, Transaction and Other Fees. Details regarding our administrative, transaction and other fees are presented belowbelow, which are typically payable at the time of the related transaction, unless otherwise noted:

Compensation and Benefits. Compensation generally includes salaries, bonuses, health and welfare benefits, payroll-related taxes, equity compensation, Part I Fee compensation and fee related performance compensation expenses. Compensation and benefits expenses are typically correlated to the operating performance of our segments, which is used to determine incentive-based compensation for each segment. Incentive-based compensation is accrued over the service period to which it relates. Our discretionary incentive-based compensation includes our annual bonus pool, is based on our operating performance and may fluctuate throughout the year until payments are made. The majority of our annual bonus payments are made in the fourth quarter. Certain of our senior partners are not paid an annual salary or bonus, instead they only receive distributions based on their ownership interest when declared by our board of directors. Part I Fee compensation and fee related performance compensation represent approximately 60% of Part I Fees and of fee related performance revenues, respectively, before giving effect to payroll-related taxes. We also reduce certain Part I Fee compensation and fee related performance compensation by a portion of the supplemental distribution fees paid to the extent that Part I Fees and fee related performance revenues are earned from certain perpetual wealth vehicles. We pay sales-based bonuses for the sale and distribution of our wealth products through AWMS,products, including our exchange programs associated with our non-traded REITs. Incremental changes in fair value of certain contingent liabilities established in connection with our various acquisitions are recognized ratably over the service period and are also presented within compensation and benefits. We use changes in headcount, which represents the full-time equivalency of active employees during each period, to analyze changes in compensation and benefits.

Equity compensation represents a form of non-cash compensation that we use to align our employees with the long-term interests of our shareholders. Equity-based awards are typically granted in the form of restricted units or restricted stock (collectively “unvested awards”) that generally vest over a service periodperiods betweenup three andto five years.years from the grant date. We issue equity awards with a long-term focus of limiting the average dilutive impact on our Class A common stockholders to no more than 1.5% annually. Because we withhold shares equal to the fair value of our employee tax withholding liabilities and pay the taxes on their behalf in cash, fewer net shares are issued upon vesting. This result has reduced the average annual dilutive impact of these awards to less than 1.0% annually. We expect the expenses recognized in connection with these awards to fluctuate with changes in the price of our Class A common stock.

Performance Related Compensation. Performance related compensation includes compensation directly related to carried interest allocation and incentive fees earned from funds with stated investment periods, generally consisting of percentage interests that we grant to our professionals. Depending on the nature of each fund, the performance related compensation generally represents 60% to 80% of the carried interest allocation and aforementioned incentive fees recognized by us before giving effect to payroll-related taxes. The performance related compensation payable is calculated based upon the recognition of carried interest allocation and is not paid to recipients until the carried interest allocation is received. Performance related compensation may include allocations to charitable organizations as part of our philanthropic initiatives.

Although the majority of changes in performance related compensation are directly correlated with changes in carried interest allocation and incentive fees reported within our segment results, this correlation does not always exist when our results are reported on a fully consolidated basis in accordance with GAAP. This discrepancy is caused when carried interest allocation and incentive fees earned from our Consolidated Funds is eliminated upon consolidation and performance related compensation is not.not, and similarly, investment income associated with strategic investments that generate profits interests for our professionals are not presented within performance income.

Marketing costs include placement fees and supplemental distribution fees. Placement fees are fundraising costs for campaign funds and include: (i) upfront fees based on commitments to a fund; and (ii) service fees for periodic investor services that are recognized as services are provided. Supplemental distribution fees are fundraising costs associated with wealth products, generally paid to strategic investors and/or financial intermediaries for the distribution of shares and may be upfront on a portion of sales, ongoing as a percentage of net asset value or temporary in the form of a fee concession. We may reduce Part I Fee compensation and fee related performance compensation associated with certain perpetual wealth vehicles by a portion of the supplemental distribution fees paid to the extent that Part I Fees and fee related performance revenues are earned from these vehicles. In such instances, the related compensation will be less than 60%.

Interest Expense. Interest expense includes interest related to our Credit Facility, which has a variable interest rate based upon SOFR plus a credit spread that is adjusted with changes to corporate credit ratings and with the achievement of certain ESG-related targets,ratings, and to our senior and subordinated notes, each of which have fixed coupon rates.

Other Income (Expense), Net. Other income (expense), net consists of (i) non-economic transaction gains (losses) on the revaluation of assets and liabilities denominated in currencies other than an entity’s functional currency; (ii) changes in fair value of contingent earnout arrangements; and (iiiii) other non-operating and non-investment related activities, such as changes in fair value of contingent liabilities, loss on disposal of assets, among other items.

We believe that our disciplined investment philosophy across our distinct but complementary investment groups contributes to the stability of our performance throughout market cycles. For the three months ended MarchJune 31,30, 2026, 93%94% of our management fees were derived from perpetual capital vehicles or long-dated funds. Our funds have a stable base of committed capital enabling us to invest in assets with a long-term focus over different points in a market cycle and to take advantage of market volatility. However, our results from operations, including the fair value of our AUM, are affected by a variety of factors. Conditions in the global financial markets and economic and political environments may impact our business, particularly in the U.S., Europe and Asia-Pacific (“APAC”).

The following table presents returns of selected market indices:-

Despite elevated uncertainty stemming from thedisruptions marketin volatility,energy markets, global commercial real estate fundamentalsmarkets strengthenedcontinued to improve in the firstsecond quarter of 2026. Transaction volumes continued to increase, debt availability improved and property values appreciated across markets. NotwithstandingRising overallJapanese strengtheninggovernment trends,bond yields pressured REIT performance during the Europeanquarter, andhowever, APACwe realdo estatenot marketsbelieve demonstratedthis greaterreflects sensitivitydeterioration toin globalour conditionsportfolio’s comparedunderlying to the U.S.fundamentals. While performance varies by sector and geography, we believe constrained new supply will be a meaningful tailwind for the commercial real estate marketsmarkets. overInfrastructure investment remained robust, particularly across the nextdigital few years. In addition, renewableinfrastructure, energy continued to scale, supported by record battery storage additions and strongutilities corporate demand for clean energy. The climate infrastructure market remained resilient, bolstered by continued progress in clean energy deployment, the expansion of digital infrastructure and sustained adoption of artificial intelligence.sectors.

Private equity activity moderated during the quarter,quarter with dealmakingthe concentration in a smaller number of large transactions. Dealmaking and exit activity softeningcontinued amidto continuedreflect market selectivity and elevated uncertainty in private credit markets. Sponsors remainedcontinued highlyto selective, prioritizingprioritize businesses with resilient fundamentals and clear paths to value creation, including differentiated technology and artificial intelligence capabilities. We believe a renewed focus on value creation strategies that emphasize operational improvements, selective deployment, talent optimization and digital transformation are essential to support long-term momentum.

We believe our portfolios across all strategies remain well positioned for a fluctuating interest rate environment. On a market value basis, approximately 83%82% of our debt assets and 51% of our total assets were floating rate instruments as of MarchJune 31,30, 2026.

(1) Includes $5.4$6.1 billion and $5.2$5.6 billion of non-fee paying AUM from our general partner and employee commitments as of MarchJune 31,30, 2026 and 2025, respectively.

(1)Includes $98.2$99.9 billion and $76.7$81.2 billion from funds that primarily invest in illiquid strategies as of MarchJune 31,30, 2026 and 2025, respectively. The underlying investments held in these funds are generally subject to less market volatility than investments held in liquid strategies.

We view the duration of funds we manage as a metric to measure the stability of our future management fees. For the three months ended MarchJune 31,30, 2026 and 2025, 93%94% and 92%,91%, respectively, of management fees were earned from perpetual capital or long-dated funds.

As of MarchJune 31,30, 2026, AUM not yet paying fees includes $79.4$92.6 billion of AUM available for future deployment and $4.2$4.1 billion of development assets not yet stabilized that could collectively generate approximately $715.9$828.2 million in potential incremental annual management fees, representing a 22%24% embedded growth rate in our base management fees from the last twelve month period.

FeeAs relatedof performanceJune revenues30, 2026 and 2025, IGAUM included $75.7 billion and $56.2 billion, respectively, of AUM from funds generating unrealized incentive fees that are not recognized by us until such fees are crystallized andor no longer subject to reversal. As of MarchJune 31,30, 2026, perpetual capital IGAUM that could potentially result in crystallized fee related performance revenues totaled $42.1$44.3 billion, composed of $23.0$24.0 billion within the Credit Group, $13.9$14.4 billion within the Real Assets Group and $5.2$5.9 billion within the Secondaries Group. As of MarchJune 31,30, 2025, perpetual capital IGAUM that could potentially result in crystallized fee related performance revenues totaled $25.7$30.2 billion, composed of $19.5$19.8 billion within the Credit Group, $3.5$7.3 billion within the Real Assets Group and $2.7$3.1 billion within the Secondaries Group. As of March 31, 2026 and 2025, IGAUM included $51.9 billion and $37.9 billion, respectively, of AUM from funds generating incentive income that is not recognized by us until such fees are crystallized or no longer subject to reversal.

We consolidate (i) entities that we have both the power to direct significant activities of the entity and a significant economic interest; and (ii) entities in which we hold a majority voting interest or have majority ownership and control over the operational, financial and investing decisions of that entity. Certain funds that have historically been consolidated in the financial statements may no longer be consolidated because: (i) such funds have been liquidated or dissolved; or (ii) we are no longer deemed to have a controlling interest in the entity. Consolidated Funds represented approximately 6%4% of our AUM as of MarchJune 31,30, 2026 and 5%4% of total revenues for the threesix months ended MarchJune 31,30, 2026.

Three and Six Months Ended MarchJune 31,30, 2026 Compared to Three and Six Months Ended MarchJune 31,30, 2025

Management Fees. Within the Credit Group, our publicly-traded and our perpetual wealth funds contributed $37.4$29.4 million and $66.8 million of the increaseincreases in management fees for the three and six months ended MarchJune 31,30, 20262026, respectively, compared to the same periodperiods in 2025, primarily driven by increases in theFPAUM averageassociated sizewith of their portfolios.fundraising. Capital deployment in private funds within our direct lending and alternative credit strategies led to a rise in FPAUM, contributing $29.6$27.0 million and $56.6 million of the increase in management fees for the three and six months ended MarchJune 31,30, 20262026, respectively, compared to the same periodperiods in 2025. Within the Real Assets Group, funds that we manage as a result of the acquisitionGCP Acquisition contributed $30.8 million of the international business of GLP Capital Partners Limited excluding its operationsincrease in Greater China (the “GCP Acquisition”) generated $34.6 million in additional management fees for the threesix months ended MarchJune 31,30, 2026 compared to onethe monthsame ofperiod in 2025, driven by fees generated for two additional months in the threecurrent monthsyear ended March 31, 2025.period.

In addition, Part I Fees increased by $29.2$25.9 million and $55.1 million for the three and six months ended MarchJune 31,30, 20262026, respectively, compared to the same periodperiods in 2025. The increaseincreases in Part I Fees waswere primarily attributable to ASIFASIF, andto our open-ended European direct lending fund and to our open-ended core infrastructure fund, driven by increases in net investment income from their growing portfolios of investments.

The increase in incentive fees for the three months ended MarchJune 31,30, 2026 compared to the same period in 2025 was primarily due to (i)higher fees generated from APMF due to NAV appreciation. The increase in incentive fees for the six months ended June 30, 2026 compared to the same period in 2025 was mostly driven by fees of $138.5 million generated by SDL I in connection with the sale of its remaining assets to a continuation vehicle; and (ii) higher fees generated from APMF resulting from increased IGAUM overduring the comparativefirst period.quarter of 2026. For further detail regarding the incentive fees within each of our segments, see discussion of fee related performance revenues and realized net performance income within “—Results of Operations by Segment.”

Principal Investment Income. The activity for the three and six months ended MarchJune 31,30, 2026 was primarily attributable to:

•Unrealized losses of $10.5$5.3 million and $4.3 million, respectively, from our investments in various European real estate equity and real estate secondaries funds, as well as $10.6 million from our investment in a U.S. real estate equity fund,fund for the six months ended June 30, 2026, partially offset by unrealized gains of $3.1$5.1 million and $5.7 million, respectively, from our investments in various Europeandigital infrastructure and Japanese real estate equity funds and opportunistic credit funds The activity for the three and six months ended MarchJune 31,30, 2025 was primarily attributable to:

•Dividend income of $4.7$7.8 million and $16.4 million, respectively, primarily generated from our investments in various real estate debt and infrastructure debt funds

•NetThe activity for the six months ended June 30, 2025 also included (i) interest income of $7.7 million from newly admitted investors in an insurance fund, where capital account balances are reallocated from existing investors in exchange for interest to compensate for carrying costs; and (ii) net realized gains of $3.5$3.1 million generated from our investments in various U.S. real estate equity funds Administrative, Transaction and Other Fees. The increaseincreases for the three and six months ended MarchJune 31,30, 2026 compared to the same periodperiods in 2025 waswere driven by: (i) an increase of $21.0$8.7 million reflectingand the$29.9 fullmillion, quarter impactrespectively, of property-related fees and administrative service fees earned from funds acquired in the GCP Acquisition; (ii) an$5.1 increasemillion inand $11.7 million, respectively, of additional administrative service fees of $6.5 million, earned from new and existing private funds within our Credit Group that are based on invested capital and from our perpetual wealth funds; and (iii) an$5.0 increasemillion inand capital$9.7 marketsmillion, transactionrespectively, of higher property management fees ofearned $5.2as million,we reflectingexpand increasedthese transactionservices volumes.across more properties and earn the fees for services that were previously provided by third-parties.

Compensation and Benefits. The following table presents the components of change in compensation and benefits for the three and six months ended MarchJune 31,30, 2026 compared to the same periodperiods in 2025 ($ in millions):

The increaseincreases in cash-based compensation and benefits reflected the continued growth in salary and benefits for our increased staffingheadcount. levels,The assix wellmonths asended theJune full30, quarter2026 impact of employment related costs ofincluded $30.8 million of incremental expense, reflecting two additional months of activities from the operations that we acquired in connection with the GCP Acquisition.

In addition, Part I Fee compensation increased over the comparative period,periods, corresponding to the increaseincreases in Part I Fees. We reduced Part I Fee compensation by $7.5$5.7 million and $4.8$4.9 million for the three months ended MarchJune 31,30, 2026 and 2025, respectively, and $13.2 million and $9.7 million for the six months ended June 30, 2026 and 2025, respectively, to reclaim a portion of the supplemental distribution fees that we paid to distribution partners.paid.

Equity compensation increased over the comparative periodperiods as a result of newly issued discretionary and bonus-related awards granted during the first quarter of 2026 at higher stock prices relative to previously granted awards that have since fully vested. Acquisition-related equity compensation expense decreased overfor the comparativesix months ended June 30, 2026 compared to the same period in 2025, as the prior year period included $108.8 million of expense from the portion of thethese awards associated with the purchase price of the GCP Acquisition that immediately vested.vested in the first quarter of 2025.

Full-time equivalent headcount increased by 24%15% to 4,2974,343 professionals for the year-to-date period in 2026 from 3,4743,776 professionals in 2025, including the impact from the GCP Acquisition of 511 full-time equivalents.2025.

Conversely, acquisition-related costs decreased by $33.4 million for the three months ended March 31, 2026 compared to the same period in 2025. Acquisition-related costs generally precede a business combination, vary with the complexity of the transaction and may occur even when acquisitions are not successfully completed. We incurredAcquisition-related costs indecreased by $35.5 million for the currentsix quartermonths primarilyended relatedJune 30, 2026 compared to the acquisitionsame ofperiod thein remaining2025. outstanding shares of BlueCove Limited (the “BlueCove Acquisition”), while weWe incurred $33.7$34.7 million during the threesix months ended MarchJune 31,30, 2025 related to the GCP Acquisition.

Net Realized and Unrealized Gains on Investments; Interest and Dividend Income. The activity for the three and six months ended MarchJune 31,30, 2026 was primarily attributable to:

•Unrealized gains of $42.7$67.2 million and $109.9 million, respectively, from our strategic investments in X‑Energy, Inc., which completed its initial public offering afterin the firstsecond quarter of 2026 (Nasdaq: XE), partially offset by unrealized losses of $36.4$12.8 million primarilyand $38.2 million, respectively, from our investments in KDK and J-REIT

•InterestThe andsix dividendmonths incomeended primarilyJune 30, 2026 also included: (i) dividend income of $3.9$1.9 million from ourJ-REIT, strategicwhich investmentdistributes individends a Brazilian alternative asset manager and from our investment in J-REIT; and (ii) income of $1.1 million from our investments in CLOs and CLO-based investmentssemi-annually The activity for the three and six months ended MarchJune 31,30, 2025 was primarily attributable to:

•Interest and dividend income primarily included: (i) income of $2.1$2.0 million and $4.2 million, respectively, from our investments in CLOs and CLO-based investments; and (ii) dividend income of $2.0 million and $4.0 million, respectively, from our strategic investment in a Brazilian alternative asset manager;manager. andThe (iii)six months ended June 30, 2025 also included $11.9 million of interest income earned from treasury-backed securities. These treasury-backed securities were sold in the first quarter of 2025 and the proceeds from the sale were used to fund the GCP Acquisition.

Interest Expense. Interest expense increased for the three and six months ended MarchJune 31,30, 2026 compared to the same periodperiods in 2025 due to a(i) higher interest expense from our Credit Facility due to its higher average outstanding balance; ofand our Credit Facility. At(ii) the endfull quarter impact of March 2026, we borrowed $400.0 million under the Term Loan. We expect interest expense attributable tofrom the Term Loan tothat bewas approximately $4.7 million per quarterexecuted in futureMarch periods.2026.

Other Income (Expense), Net. Other income (expense), net for the three months ended March 31, 2026 also included non-cash expense of $14.3$13.6 million fromand an$27.9 increasemillion for the three and six months ended June 30, 2026, respectively, and $25.5 million for both the three and six months ended June 30, 2025, attributable to increases in fair value of contingent consideration,consideration reflectingthat reflect our progress toward achieving the earnouts established in connection with the GCP Acquisition. These earnouts are based on revenue targets of certain digital infrastructure funds and fundraising targets of certain Japanese real estate funds. See “Note 7. Commitments and Contingencies” within our unaudited condensed consolidated financial statements for a further description of these contingent earnout arrangements.

The increaseincreases in income tax expense waswere primarily attributable to higher pre-tax income allocable to AMC and higher entity level taxes in foreign and local jurisdictionsjurisdictions, with both increasing the effective tax rate for the three and six months ended MarchJune 31,30, 2026 compared to the same periodperiods in 2025.

The changechanges in ownership compared to the prior year periodperiods waswere primarily driven by the issuances of shares of Class A common stock in connection with the vesting of restricted unit awards and with exchanges of AOG Units.

The changechanges in net income attributable to non-controlling interests in AOG entities compared to the prior year periodperiods waswere primarily a result of the respective changechanges in ownership and in income before taxes of the CompanyCompany, as presented above.

Credit Group—Three and Six Months Ended MarchJune 31,30, 2026 Compared to Three and Six Months Ended MarchJune 31,30, 2025

The following table presents the components of and causes for changes in the Credit Group’s management fees for the three and six months ended MarchJune 31,30, 2026 compared to the prior year period ($ in millions):

The decreasedecreases in effective management fee raterates for the three and six months ended MarchJune 31,30, 2026 compared to the same periodperiods in 2025 waswere primarily attributable to increases in FPAUM from our funds in theour liquid credit strategy, which have an effective fee rate of less than 0.50%.

Fee Related Performance Revenues. Fee related performance revenues decreased for the three monthsand ended March 31, 2026 compared to the same period in 2025. Fee related performance revenues for the threesix months ended MarchJune 31,30, 2026 were primarily attributable to incentive fees from our open-ended sports, media and entertainment opportunities fund, which has a quarterly measurement period and a fee waiver that expired at the end of 2025. Fee related performance revenues for the threesix months ended MarchJune 31,30, 2025 were primarily attributable to incentive fees from a European direct lending fund that crystallized feesa followingdeferred payment during the first quarter of 2025 due to the restructuring of its hold back provisions.

Other Fees. The increaseincreases in other fees for the three and six months ended MarchJune 31,30, 2026 compared to the same periodperiods in 2025 waswere primarily driven anby: increase(i) inhigher administrative service fees of $3.1$2.9 million and $6.1 million, respectively, which are earned on invested capital from certain private funds; thatand pay(ii) on invested capital. In addition,higher capital markets transaction fees wereof higher$2.3 bymillion $1.7and $4.1 million, respectively, reflecting increased transaction volumes.

General, Administrative and Other Expenses. The increaseincreases in general, administrative and other expenses for the three and six months ended MarchJune 31,30, 2026 compared to the same periodperiods in 2025 wasreflect drivengrowing headcount and fundraising activities, including our firmwide AGM event. The increases over the comparative periods were partially offset by: (i) an increase in professional service fees of $4.4 million; (ii) an increasedecreases in supplemental distribution fees of $2.6$7.7 million asand we$5.1 continuemillion, torespectively, expandprimarily driven by lower sales in ASIF and our wealthopen-ended productEuropean offeringsdirect andlending distribution relationships; and (iii) an increasefund in informationthe technologycurrent costs of $1.1 million to support our growing headcount.quarter.