10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934.

For the quarterly period ended September 30, 2022

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES

EXCHANGE ACT OF 1934.

For the transition period from to .

Commission file number 001-33099

BlackRock, Inc.

(Exact name of registrant as specified in its charter)

Delaware

32-0174431

(State or Other Jurisdiction of
Incorporation or Organization)

(I.R.S. Employer Identification No.)

55 East 52nd Street, New York, NY 10055

(Address of Principal Executive Offices)

(Zip Code)

(212) 810-5300

(Registrant’s Telephone Number, Including Area Code)

(Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $.01 par value	BLK	New York Stock Exchange
1.250% Notes due 2025	BLK25	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.


Yes		X		No

Indicate by check mark whether the registrant has submitted electronically, every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).


Yes		X		No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).


Yes				No		X

As of October 31, 2022, there were 150,195,577 shares of the registrant’s common stock outstanding.

BlackRock, Inc.

Index to Form 10-Q

PART I

FINANCIAL INFORMATION


		Page

Item 1.	Financial Statements (unaudited)

	Condensed Consolidated Statements of Financial Condition	1

	Condensed Consolidated Statements of Income	2

	Condensed Consolidated Statements of Comprehensive Income	3

	Condensed Consolidated Statements of Changes in Equity	4

	Condensed Consolidated Statements of Cash Flows	6

	Notes to Condensed Consolidated Financial Statements	7

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	33

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	65

Item 4.	Controls and Procedures	66

PART II

OTHER INFORMATION


Item 1.	Legal Proceedings	67

Item 1A.	Risk Factors	68

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	69

Item 6.	Exhibits	70

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

BlackRock, Inc.

Condensed Consolidated Statements of Financial Condition

(unaudited)


	September 30,			December 31,
(in millions, except shares and per share data)	2022			2021
Assets
Cash and cash equivalents(1)	$	6,797		$	9,323
Accounts receivable		3,361			3,789
Investments(1)		6,907			7,262
Separate account assets		51,072			86,226
Separate account collateral held under securities lending agreements		5,867			7,081
Property and equipment (net of accumulated depreciation and amortization of $1,393 and $1,256 at September 30, 2022 and December 31, 2021, respectively)		965			762
Intangible assets (net of accumulated amortization of $485 and $399 at September 30, 2022 and December 31, 2021, respectively)		18,339			18,453
Goodwill		15,344			15,351
Operating lease right-of-use assets		1,491			1,621
Other assets(1)		5,287			2,780
Total assets	$	115,430		$	152,648
Liabilities
Accrued compensation and benefits	$	1,747		$	2,951
Accounts payable and accrued liabilities		1,601			1,397
Borrowings		6,591			7,446
Separate account liabilities		51,072			86,226
Separate account collateral liabilities under securities lending agreements		5,867			7,081
Deferred income tax liabilities		2,695			2,758
Operating lease liabilities		1,773			1,872
Other liabilities(1)		5,967			4,024
Total liabilities		77,313			113,755
Commitments and contingencies (Note 15)
Temporary equity
Redeemable noncontrolling interests		828			1,087
Permanent Equity
BlackRock, Inc. stockholders’ equity
Common stock, $0.01 par value;		2			2
Shares authorized: 500,000,000 at September 30, 2022 and December 31, 2021; Shares issued: 172,075,373 at September 30, 2022 and December 31, 2021; Shares outstanding: 150,461,863 and 151,684,491 at September 30, 2022 and December 31, 2021, respectively
Additional paid-in capital		19,609			19,640
Retained earnings		29,348			27,688
Accumulated other comprehensive loss		(1,472	)		(550	)
Treasury stock, common, at cost (21,613,510 and 20,390,882 shares held at September 30, 2022 and December 31, 2021, respectively)		(10,325	)		(9,087	)
Total BlackRock, Inc. stockholders’ equity		37,162			37,693
Nonredeemable noncontrolling interests		127			113
Total permanent equity		37,289			37,806
Total liabilities, temporary equity and permanent equity	$	115,430		$	152,648

(1)

At September 30, 2022, cash and cash equivalents, investments, other assets and other liabilities include $275 million, $3,533 million, $68 million, and $1,902 million, respectively, related to consolidated variable interest entities (“VIEs”). At December 31, 2021, cash and cash equivalents, investments, other assets and other liabilities include $251 million, $3,968 million, $50 million, and $1,919 million, respectively, related to consolidated VIEs.

See accompanying notes to condensed consolidated financial statements.

BlackRock, Inc.

Condensed Consolidated Statements of Income

(unaudited)


	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(in millions, except per share data)	2022			2021			2022			2021
Revenue
Investment advisory, administration fees and securities lending revenue:
Related parties	$	2,647		$	2,964		$	8,299		$	8,478
Other third parties		884			979			2,753			2,814
Total investment advisory, administration fees and securities lending revenue		3,531			3,943			11,052			11,292
Investment advisory performance fees		82			345			286			814
Technology services revenue		338			320			1,011			942
Distribution fees		325			401			1,067			1,110
Advisory and other revenue		35			41			120			110
Total revenue		4,311			5,050			13,536			14,268
Expense
Employee compensation and benefits		1,339			1,527			4,251			4,484
Distribution and servicing costs		536			585			1,682			1,613
Direct fund expense		318			354			951			994
General and administration expense		554			611			1,580			1,657
Amortization of intangible assets		38			38			114			109
Total expense		2,785			3,115			8,578			8,857
Operating income		1,526			1,935			4,958			5,411
Nonoperating income (expense)
Net gain (loss) on investments		174			370			(242	)		766
Interest and dividend income		41			14			80			41
Interest expense		(50	)		(48	)		(158	)		(155	)
Total nonoperating income (expense)		165			336			(320	)		652
Income before income taxes		1,691			2,271			4,638			6,063
Income tax expense		330			518			951			1,490
Net income		1,361			1,753			3,687			4,573
Less:
Net income (loss) attributable to noncontrolling interests		(45	)		72			(232	)		315
Net income attributable to BlackRock, Inc.	$	1,406		$	1,681		$	3,919		$	4,258
Earnings per share attributable to BlackRock, Inc. common stockholders:
Basic	$	9.33		$	11.05		$	25.92		$	27.94
Diluted	$	9.25		$	10.89		$	25.67		$	27.59
Weighted-average common shares outstanding:
Basic		150.6			152.1			151.2			152.4
Diluted		152.0			154.3			152.6			154.4

See accompanying notes to condensed consolidated financial statements.

BlackRock, Inc.

Condensed Consolidated Statements of Comprehensive Income

(unaudited)


	Three Months Ended						Nine Months Ended
	September 30,						September 30,
(in millions)	2022			2021			2022			2021
Net income	$	1,361		$	1,753		$	3,687		$	4,573
Other comprehensive income (loss):
Foreign currency translation adjustments(1)		(381	)		(138	)		(922	)		(189	)
Comprehensive income (loss)		980			1,615			2,765			4,384
Less: Comprehensive income (loss) attributable to noncontrolling interests		(45	)		72			(232	)		315
Comprehensive income attributable to BlackRock, Inc.	$	1,025		$	1,543		$	2,997		$	4,069

(1)

Amounts for the three months ended September 30, 2022 and 2021 include gains from a net investment hedge of $35 million (net of tax expense of $11 million) and $14 million (net of tax expense of $5 million), respectively. Amounts for the nine months ended September 30, 2022 and 2021 include gains from a net investment hedge of $84 million (net of tax expense of $26 million) and $34 million (net of tax expense of $11 million), respectively.

See accompanying notes to condensed consolidated financial statements.

BlackRock, Inc.

Condensed Consolidated Statements of Changes in Equity

(unaudited)

For the Nine Months Ended September 30, 2022


(in millions)	Additional Paid-in Capital(1)		Retained Earnings		Accumulated Other Comprehensive Income (Loss)			Treasury Stock Common			Total BlackRock Stockholders’ Equity		Nonredeemable Noncontrolling Interests		Total Permanent Equity		Redeemable Noncontrolling Interests / Temporary Equity
December 31, 2021	$	19,642	$	27,688	$	(550	)	$	(9,087	)	$	37,693	$	113	$	37,806	$	1,087
Net income		—		3,919		—			—			3,919		2		3,921		(234	)
Dividends declared ($