Ares Management’s first quarter saw strong revenue growth, with management attributing performance to robust institutional fundraising and broad-based product demand across its credit, real assets, and secondaries platforms. CEO Michael J. Arougheti emphasized that, despite a seasonal slowdown and geopolitical uncertainty, the firm’s deployment and fundraising remained resilient. He highlighted that “our pipeline of new institutional funds remains robust for this year and next year,” supporting a significant increase in assets under management and management fees. The market reaction to these results was muted, with investors showing little response to the company’s headline earnings.
Is now the time to buy ARES? Find out in our full research report (it’s free for active Edge members).
Ares (ARES) Q1 CY2026 Highlights:
- Revenue: $1.27 billion vs analyst estimates of $1.30 billion (26.2% year-on-year growth, 2.3% miss)
- Adjusted EPS: $1.24 vs analyst expectations of $1.33 (6.6% miss)
- Adjusted EBITDA: $435.4 million vs analyst estimates of $473.9 million (34.2% margin, 8.1% miss)
- Operating Margin: 20.1%, up from 13.1% in the same quarter last year
- Market Capitalization: $27.77 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Ares’s Q1 Earnings Call
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Craig Siegenthaler (Bank of America): Asked about trends in institutional, insurance, and retail channels for private credit. CEO Michael J. Arougheti explained that institutional demand remains strong, with retail flows more volatile but not impacting overall deployment or profitability.
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Alexander Blostein (Goldman Sachs): Inquired about deployment pipelines and the impact of non-traded BDCs on market structure. Arougheti responded that Ares’ global platform allows broad-based deployment, with growing opportunities in infrastructure, real estate, and European direct lending.
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Steven Chubak (Wolfe Research): Questioned the resilience of retail flows outside U.S. private credit. Arougheti stated that demand for infrastructure, secondaries, and other wealth products is accelerating, attributing retail credit outflows to isolated investor segments.
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Patrick Davitt (Autonomous Research): Asked about timing and conversion of the direct lending pipeline. Arougheti explained there is a lag between pipeline build and deal announcements, but catalysts for deal activity remain intact.
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William Raymond Katz (TD Cowen): Requested clarity on realization revenues and margin outlook. CFO Jarrod Morgan Phillips highlighted that realization timing depends on market activity, but margin expansion is supported by scale and ongoing efficiency gains.
Catalysts in Upcoming Quarters
In upcoming quarters, our analysts will be tracking (1) the pace and breadth of institutional fundraising and deployment, (2) continued product innovation and expansion into new asset classes like digital infrastructure and real estate secondaries, and (3) the evolution of retail channel flows, especially in private credit. Progress on data center fundraises, European direct lending activity, and margin expansion will be additional key signposts for execution.
Ares currently trades at $123.25, up from $117.40 just before the earnings. At this price, is it a buy or sell? Find out in our full research report (it’s free).
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