Carlyle Group Inc. (CG) Q4 2024 Earnings Summary

Executive Summary

Carlyle delivered a solid Q4 with GAAP revenues of $1.03B and income before tax of $265M (25.7% margin), while after-tax DE/share was $0.92 and FRE rose to $287M with a 44% margin .
Record 2024 execution: management highlighted meeting all financial targets, including record annual FRE ($1.1B) and margin (46%), robust inflows ($40.8B FY), and ongoing capital return; Q4 dividend was maintained at $0.35 .
2025 outlook: management guided FRE growth of ~6% YoY with similar margins, inflows roughly in line with 2024, and ~$200M of annual management fees as pending FEAUM turns on; late-2025 launch for the next U.S. buyout fund with fee activation in 2026 .
Strategic engines: Credit (third opportunistic credit fund closed and a landmark asset‑backed finance transaction), record capital markets fees, and Global Investment Solutions (44% fee revenue growth in 2024) underpin multi‑year growth; U.S. buyout funds appreciated 15% and 21% in 2024 with two notable IPOs (StandardAero, Rigaku) .

What Went Well and What Went Wrong

What Went Well

“Carlyle delivered a strong 2024, meeting every financial target we set, including record Fee Related Earnings and FRE margin, and robust inflows.” – CEO Harvey Schwartz .
Capital markets diversification drove record transaction fees in 2024 (now spanning credit, infrastructure, and renewables) despite sub-peak market volumes .
Portfolio strength: Two latest U.S. buyout funds appreciated 15% and 21% in 2024, creating >$5B in value; IPOs of StandardAero (U.S.) and Rigaku (Japan) executed successfully .

What Went Wrong

Global Private Equity fee revenues declined YoY in 2024 (−7% full-year), reflecting step-downs and realizations; management expects a smaller decline in 2025 with growth resuming post CP9 activation in 2026 .
Fee-earning AUM dipped 1% YoY in Q4 (to $304B) due to outflows and step-downs in GPE; FX and a $6B Fortitude mark-to-market in Q4 added noise (immaterial 2025 economic impact) .
Realized Net Performance Revenues were modest at $78M in Q4 (down from $91M in Q3), with carry realization cadence still below prior cycle peaks .

Financial Results

Metric	Q2 2024	Q3 2024	Q4 2024	Q4 2023 (YoY)	vs Estimates
Total Revenues ($MM)	1,069.7	2,635.2	1,032.5	926.2	n/a (SPGI limit)
Income Before Tax ($MM)	218.8	788.8	265.4	(842.7)	n/a (SPGI limit)
Income Before Tax Margin (%)	20.5%	29.9%	25.7%	(91.0%)	n/a (SPGI limit)
Net Income to Common ($MM)	148.2	595.7	210.9	(692.0)	n/a (SPGI limit)
Diluted EPS ($)	0.40	1.63	0.57	(1.92)	n/a (SPGI limit)
After-tax DE / Share ($)	0.78	0.95	0.92	0.86	n/a (SPGI limit)
FRE ($MM)	273.0	277.9	287.4	254.0	n/a (SPGI limit)
FRE Margin (%)	46%	47%	44%	43%	n/a (SPGI limit)
Realized Net Performance Revenues ($MM)	55.7	90.6	77.8	136.4	n/a (SPGI limit)

Note on estimates: S&P Global consensus for Q4 2024 was unavailable due to rate limits; therefore, “vs Estimates” is n/a. Values retrieved from S&P Global*

Segment performance (Q4 2024):

Segment (Q4)	AUM ($B)	Fee Revenues ($MM)	FRE ($MM)
Global Private Equity	164	311.4	137.8
Global Credit	192	238.5	97.8
Global Investment Solutions	85	104.8	51.8

KPIs and balance sheet:

KPI	Q2 2024	Q3 2024	Q4 2024
Total AUM ($B)	435	447	441
Fee‑Earning AUM ($B)	307	314	304
Perpetual FEAUM ($B)	90	95	91
Pending FEAUM ($B)	18	21	23
Available Capital/Dry Powder ($B)	83	85	84
Inflows ($B)	—	8.8 Q3	14.2 Q4; 40.8 FY
Deployment ($B)	—	3.9 Q3 (carry funds)	17.6 Q4; 42.7 FY
Realized Proceeds ($B)	—	6.8 Q3 (carry funds)	10.0 Q4; 28.6 FY
Carry Fund Appreciation (%)	1% Q2 LTM 7%	3% Q3; 8% LTM	1% Q4; 8% FY
Net Accrued Performance Revenues ($B)	2.18	2.79	2.74
Cash & Equivalents ($MM)	914.8	1,376.8	1,266.0
Debt Obligations ($MM)	2,235.2	2,211.0	1,855.5

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
FRE Growth	FY 2025	n/a	~+6% YoY	New
FRE Margin	FY 2025	n/a	“Similar to 2024”	New
Inflows	FY 2025	n/a	“Similar to 2024”	New
Pending FEAUM Activation	2025 run-rate	n/a	~$200M annual management fees	New
Compensation Ratio	Multi‑year	30–35% discussed previously	Target 35% or less over time	Maintained/clarified
Buybacks	2025	$0.9B capacity at 12/31/24	~$0.85B remaining; “active” in 2025	Maintained/updated
CP9 (U.S. Buyout)	Fundraise/Fees	n/a	Launch late 2025; fee activation 2026	New timing
Dividend	Ongoing	$0.35/share quarterly	$0.35/share declared for Q4	Maintained

Earnings Call Themes & Trends

Topic	Previous Mentions (Q2 & Q3)	Current Period (Q4)	Trend
Asset‑Backed Finance (ABF)	Announced $10B Discover loan portfolio deal; ABF positioned as multitrillion TAM; CLO engine very active	“Landmark” ABF transaction; ABF market ~$25T; dedicated fund raising; team scaled ~30% in 2024	Stronger growth focus
Capital Markets Fees	Up ~60% YoY in Q2; strategy priority	Record year, diversified beyond PE into credit/infra/renewables	Accelerating
Global Wealth	CAPM and CTAC gaining traction on platforms	Record $4.5B wealth inflows in 2024; PE wealth product targeted H2’25	Scaling
Realizations/IPO Market	Building pipeline; expected higher H2 activity	Successful IPOs: StandardAero, Rigaku; 2025 to be “busy” for realizations	Improving backdrop
Tariffs/Macro/Policy	Q3: election clarity and Fed normalization seen as positive	New admin viewed pro‑growth; tariffs manageable given U.S.-centric/services mix	Supportive macro stance
Insurance/Fortitude	Partnership enables ABF/PIG flows; block market competitive; disciplined deployment	Fortitude MTM noise in FEAUM immaterial to 2025 economics	Steady
GPE Fees/Next Fund	Q2/Q3: step-down headwinds; real estate strength	CP9 launch late 2025; fee activation 2026; 2025 GPE fee decline “meaningfully lower”	Turning point ahead

Management Commentary

“Carlyle delivered a strong 2024, meeting every financial target we set, including record Fee Related Earnings and FRE margin, and robust inflows.” – Harvey Schwartz, CEO .
“We expect 2025 to be a year of growth… We expect FRE to increase 6%… and 2025 FRE margin to be at a similar level to that of 2024… We expect inflows in 2025 to be similar to 2024 levels.” – John Redett, CFO .
“Global Credit has remained our fastest-growing area… revenues increasing 22% in 2024… We closed our third opportunistic credit fund… completed a landmark Discovery transaction… asset‑backed finance is a massive addressable market.” – CEO .
“We are finalizing fundraising for our eighth vintage secondary fund… Global Wealth saw record inflows of $4.5 billion… expect our new private equity product to launch in the latter half of 2025.” – CEO .
“We anticipate launching the… U.S. buyout fund towards the back end of 2025… you will see a fee activation at some point in 2026.” – CFO .

Q&A Highlights

Capital Return: ~$850M remaining on the $1.4B repurchase authorization; management expects to be active in 2025, balancing buybacks with organic growth investments .
Fee‑Earning AUM “noise”: ~$6B Fortitude mark-to-market and ~~$3B FX in Q4 had immaterial 2025 economic impact (couple of million dollars), with $23B pending FEAUM to turn on (~~$200M fees annually) .
G&A/Investments: Q4 G&A elevation was seasonal and had one‑offs (fundraising, FX); 2025 investment priority areas include Wealth (50%+ headcount increase), ABF, Solutions, and Japan .
BDC Merger: Expected late Q1/early Q2 2025 close; positive (but not material) uplift to fees and FRE .
GPE Outlook: 2025 management fee decline in GPE to be significantly less than 2024; CP9 fundraise late 2025, activation 2026 .

Estimates Context

Consensus (S&P Global) for Q4 2024 EPS and revenue was unavailable due to rate limits, so we could not quantify beat/miss. Values retrieved from S&P Global*
Implications: Given after‑tax DE/share of $0.92 and steady FRE progression, sell‑side estimate revisions for 2025 likely center on: (a) pacing of the ~$200M pending FEAUM activation, (b) trajectory of capital markets fees, and (c) realization cadence—management’s 6% FRE guide does not assume a “substantial pickup” in realizations .

Key Takeaways for Investors

Multi‑engine earnings story: Credit, Solutions, Capital Markets, and Wealth continue to offset near‑term GPE fee headwinds; FRE trendline remains positive (+44% Q/Q to $287M, margin 44%) .
2025 setup: Mid‑single‑digit FRE growth with similar margins appears conservative; upside levers include faster wealth growth, stronger capital markets fees, and insurance flows .
Realization optionality: Net accrued performance revenues at $2.74B provide earnings conversion potential as exit markets normalize; 2025 expected to be “busy” for realizations .
Visibility from pending fees: $23B pending FEAUM (~$200M annual fees) underpins management fee growth as activations occur through 2025 .
Capital allocation: Dividend maintained at $0.35, and buybacks remain active with ~$0.85–$0.9B capacity; balance sheet liquidity and net accrued carry support flexibility .
GPE inflection ahead: Expect reduced 2025 GPE fee pressure and a turn to growth post CP9 activation in 2026; real estate franchise continues to perform and fundraise .
Trading lens: Near‑term catalysts include: (1) capital markets fee run‑rate in H1’25, (2) CLO/credit issuance and ABF flow growth, (3) realization announcements, and (4) timing of pending FEAUM activation .

* S&P Global estimates disclaimer: Consensus estimates unavailable due to rate limits at the time of retrieval. All other reported figures are sourced from company filings and presentations as cited.

Citations:

Q4 2024 8‑K and exhibits:
Q3 2024 8‑K and exhibits:
Q2 2024 8‑K and exhibits:
Q4 2024 earnings call transcript:
Q3 2024 earnings call transcript:
Q4‑period press releases (context): Stonepeak/Forgital ; Sedgwick/Altas .