10-K: Apollo Global Management Reports Strong 2025 Growth Amidst Mixed Financials

Apollo Global Management reports significant revenue and AUM growth in 2025, driven by its Asset Management and Retirement Services segments, despite a decrease in net income.

Summary

• Total Assets Under Management (AUM) increased by $187.4 billion, or 25.0%, to $938.4 billion as of December 31, 2025, from $751.0 billion in 2024.
• Total Fee-Generating AUM increased by $140.5 billion, or 24.7%, to $709.1 billion as of December 31, 2025, from $568.7 billion in 2024.
• Total Revenues increased by $5.935 billion, or 22.7%, to $32.049 billion in 2025 from $26.114 billion in 2024.
• Net income attributable to Apollo Global Management, Inc. common stockholders decreased by $1.085 billion, or 24.2%, to $3.395 billion in 2025 from $4.480 billion in 2024.
• Asset Management revenues increased by $824 million to $5.0 billion in 2025, primarily driven by a $479 million increase in management fees and a $380 million increase in advisory and transaction fees, net.
• Retirement Services revenues increased by $5.1 billion to $27.0 billion in 2025, primarily due to a $3.5 billion increase in net investment income and a $1.3 billion increase in premiums.
• Spread Related Earnings (SRE) for the Retirement Services segment increased by $137 million, or 4%, to $3.361 billion in 2025.
• Principal Investing Income (PII) increased by $67 million, or 24.7%, to $338 million in 2025.
• The company completed the acquisition of Bridge Investment Group Holdings Inc. in an all-stock transaction on September 2, 2025, contributing $34.2 billion to equity AUM.
• Origination volumes for 2025 were $309 billion, with core credit and origination platforms representing approximately 45% and 40%, respectively.
• The U.S. 10-year Treasury yield decreased to 4.18% as of December 31, 2025, from 4.58% as of December 31, 2024.
• The S&P 500 Index increased by 16.4% in 2025, following an increase of 23.3% in 2024.
• The company expects to record a full valuation allowance of $1.7 billion against its Bermuda deferred tax assets in the first quarter of 2026 due to changes in Pillar Two tax guidance.

Sentiment

Score: 6

Explanation: StockSavvy.ai views this as moderately positive. While the company demonstrated strong AUM and revenue growth, indicating successful business expansion and client engagement, the notable decline in net income and net investment spread, coupled with significant market risk benefit losses, presents a mixed financial picture. The future tax impact from Bermuda CIT is a near-term negative to equity, though management views it as long-term favorable.

Positives

• Total AUM grew significantly by 25.0% to $938.4 billion, demonstrating strong capital inflows and successful asset management.
• Total Fee-Generating AUM increased by 24.7% to $709.1 billion, indicating a growing base for recurring revenue.
• Total Revenues increased by 22.7% to $32.049 billion, reflecting robust performance across business segments.
• Asset Management revenues increased by $824 million, driven by higher management fees and advisory/transaction fees, net.
• Retirement Services revenues increased by $5.1 billion, primarily due to significant growth in net investment income and premiums.
• Spread Related Earnings (SRE) for Retirement Services increased by 4% to $3.361 billion, indicating continued profitability in this segment.
• Principal Investing Income (PII) increased by 24.7% to $338 million, showing improved performance in realized investment activities.
• The acquisition of Bridge Investment Group Holdings Inc. expanded real estate equity product offerings and contributed $34.2 billion to equity AUM.
• Origination volumes reached $309 billion in 2025, highlighting strong asset sourcing and deployment capabilities.
• Traditional private equity funds have consistently produced attractive long-term investment returns, with a 39% gross IRR and a 24% net IRR on a compound annual basis since inception through December 31, 2025.
• Athene's estimated U.S. RBC ratio of 436%, Bermuda RBC ratio of 454%, and consolidated RBC ratio of 441% as of December 31, 2025, indicate a strong capital position.
• The company increased its share repurchase program authorization from $3.0 billion to $4.0 billion, signaling confidence in future cash flows and commitment to shareholder returns.

Negatives

• Net income attributable to Apollo Global Management, Inc. common stockholders decreased by 24.2% from $4.480 billion in 2024 to $3.395 billion in 2025.
• Asset Management investment income decreased by $162 million in 2025, primarily due to a $165 million decrease in performance allocations.
• Performance allocation losses were recorded from Fund IX and Athora in 2025.
• Retirement Services investment related gains (losses) decreased by $501 million in 2025, driven by unfavorable net foreign exchange impacts and an increase in realized losses on AFS securities.
• Market risk benefits remeasurement (gains) losses shifted from a $102 million gain in 2024 to a $452 million loss in 2025, primarily due to unfavorable changes in fair value from rate movements.
• Cost of funds in Retirement Services increased by $2.4 billion, leading to a decrease in the net investment spread from 1.78% in 2024 to 1.61% in 2025.
• The U.S. dollar weakened against the euro and the British pound in 2025, contributing to unfavorable net foreign exchange impacts.
• Fund VIII's remaining investments and escrow cash were valued at 87% of the fund's unreturned capital, which is below the required escrow ratio of 115%, limiting current and future performance fee distributions to the general partner.
• The company expects to record a full valuation allowance of $1.7 billion against its Bermuda deferred tax assets in the first quarter of 2026, resulting in a reduction to equity.

Risks

• Evolving political, market, and economic conditions, including inflation, interest rate fluctuations, geopolitical events, and trade barriers, may adversely affect businesses and financial results.
• A portion of revenues, earnings, and cash flow is highly variable, primarily due to performance fees and transaction fees, which may lead to volatility in share price.
• Expansion into new investment strategies, geographic markets, and businesses, including acquisitions and joint ventures, involves risks such as diversion of management attention, operational disruption, and increased regulatory scrutiny.
• Business initiatives to increase products offered to individual investors could expose the company to heightened litigation and regulatory enforcement risks, increased compliance burdens, and complex administration.
• Operating in highly competitive industries could limit the ability to achieve growth strategies, attract and retain investors, execute transactions on favorable terms, and maintain or increase fees.
• Dependence on management's assumptions and estimates (e.g., valuations, interest rates, mortality) means significant gains or losses could occur if actual results differ from these estimates.
• The loss of services of any key personnel or damage to their reputation could have a material adverse effect on the business.
• Actual or alleged misconduct, unethical behavior, or fraud by current or former employees, directors, or third parties could harm the company's reputation and lead to legal liability or regulatory scrutiny.
• Reliance on technology and information systems, including third-party vendors, means failures or interruptions could adversely affect business operations and security.
• The rapid evolution and increasing prevalence of AI Technologies may increase competitive, operational, legal, and regulatory risks, including data misuse, flawed algorithms, and compliance costs.
• Many funds manage investments in illiquid assets, and the retirement services business holds relatively illiquid investments, which may prevent the realization of profits for considerable periods or force sales at a loss.
• Reliance on debt and equity financing markets means difficulty in obtaining or refinancing debt could impact the ability to fund operations and achieve targeted rates of return.
• A financial strength rating downgrade, potential downgrade, or any other negative action by a rating agency could make product offerings less attractive, inhibit business acquisition, and increase the cost of capital for the retirement services business.
• Inability to attract and retain independent marketing organizations (IMOs), banks, and broker-dealers could adversely affect sales of retirement services products.
• Exposure to liquidity risk, where the company may be unable to meet near-term obligations due to insufficient funding sources or immediate and significant cash needs.
• The amount of statutory capital that insurance and reinsurance subsidiaries have or are required to hold can vary significantly due to factors outside of the company's control, potentially leading to regulatory action.
• Repurchase agreement programs subject the company to potential liquidity and other risks, such as being required to deliver additional collateral or sell securities at inopportune times.
• Exposure to credit risk of counterparties, including ceding companies, reinsurers, plan sponsors, and derivative counterparties.
• The investment portfolio of the retirement services business may be subject to concentration risk with respect to single issuers, industries (e.g., financial services), and asset classes (e.g., real estate).
• Failure to deal appropriately with conflicts of interest could damage the company's reputation and adversely affect its businesses.
• Extensive regulation of businesses affects activities and creates the potential for significant liabilities and penalties, with increased regulatory focus resulting in additional burdens.
• The company has been and may be the target or subject of third-party litigation from time to time, which could result in significant liabilities and/or reputational harm.
• Climate change-related risks and regulatory efforts to address climate change could adversely affect the business and investments.
• The tax treatment of the company's structure is complex and may be subject to change, potentially on a retroactive basis, increasing tax liability.
• The company's structure is subject to a number of minimum tax regimes (e.g., OECD Pillar Two, Bermuda CIT), the implementation of which remains uncertain and may cause adverse tax consequences.
• Certain non-U.S. subsidiaries may be subject to U.S. federal income taxation in an amount greater than expected.
• The market price and trading volume of the company's shares may be volatile, which could result in rapid and substantial losses for stockholders.
• An investment in the company's shares is not an investment in any of the funds managed by the company, and the assets and revenues of such funds are not directly available to the company.
• The company's Certificate of Incorporation provides that the Court of Chancery of the State of Delaware is the sole and exclusive forum for certain legal actions, which could limit stockholders' ability to obtain a judicial forum viewed as more favorable.
• Declaration, payment, and amounts of dividends, if any, to holders of shares will be uncertain and are at the sole discretion of the board of directors.
• The anticipated issuance of additional shares of common stock in connection with the mandatory conversion of the Series A Mandatory Convertible Preferred Stock may result in additional dilution to existing stockholders and impact per-share financial metrics.

Future Outlook

The International Monetary Fund estimates the U.S. economy will expand by 2.4% in 2026 and 2.0% in 2027. The company expects to continue paying an annual dividend on its common stock, with increases based on business growth. Asset management operations are expected to be funded through management and performance fees, while the retirement services investment portfolio is anticipated to grow to cover long-term liquidity requirements. The company will continue to monitor future guidance and rulemaking regarding tax legislation, with the Bermuda CIT changes expected to have favorable long-term tax implications despite a near-term equity reduction.

Management Comments

• "Our objective is to achieve superior long-term risk-adjusted returns for our clients."
• "We have a contrarian, value-oriented investment approach, emphasizing downside protection, and the preservation of capital."
• "We believe our commitment to expanding opportunity across our ecosystem is central to the Apollo business model, an integrated platform which fosters strong collaboration across businesses and functions."
• "We strive to build a culture where all of our people can excel and grow in their careers."
• "Athene believes it has a strong capital position and is well positioned to meet policyholder and other obligations."
• "Athene generally seeks mid-teen or higher returns on its capital deployment."
• "Management views the possibility of all of the investments becoming worthless as remote."
• "Apollo believes the claims in this action [Harbinger] are without merit."
• "Apollo believes the claims in this action [Delaware class action] are without merit."
• "At this time, the Company cannot reasonably estimate any potential loss [German tax authorities]."
• "The Company believes that these developments, including the revocation of ACRAs election to be subject to the Bermuda CIT, will have favorable implications for the Companys overall tax position over the longer term."

Industry Context

StockSavvy.ai notes that Apollo's strong AUM growth and strategic acquisitions like Bridge Investment Group reflect a broader trend in the alternative asset management industry towards consolidation and expansion into diverse asset classes, particularly real estate and credit. The increase in perpetual capital vehicles aligns with institutional investor demand for long-duration, stable investment solutions. The competitive landscape remains intense, with firms vying for investor capital and talent, and increasing regulatory scrutiny, especially concerning AI and ESG, is a sector-wide challenge. The decline in net investment spread for retirement services, despite higher net investment earned rates, indicates the persistent pressure on liability costs in the annuity market.

Comparison to Industry Standards

• Apollo's traditional private equity funds generated a 39% gross IRR and a 24% net IRR on a compound annual basis from inception through December 31, 2025. These returns are generally considered strong within the private equity industry, often outperforming public market benchmarks over the long term.
• Athene's estimated U.S. RBC ratio of 436%, Bermuda RBC ratio of 454%, and consolidated RBC ratio of 441% as of December 31, 2025, indicate a robust capital position, generally exceeding regulatory minimums and often comparing favorably to industry peers, which typically aim for ratios well above 200-300% for strong financial strength ratings.
• The increase in the share repurchase program from $3.0 billion to $4.0 billion reflects a common practice among mature, cash-generative financial institutions to return capital to shareholders, often signaling management's confidence in the company's valuation and future prospects.

Corporate Governance

Legal Proceedings

• Harbinger Capital Partners II LP et al. v. Apollo Global Management LLC, et al.: A lawsuit seeking $1.9 billion in damages for alleged concealment of material defects in SkyTerra technology. The New York Supreme Court Appellate Division affirmed dismissal as time-barred on March 18, 2025. Plaintiffs' motion for re-argument or leave to appeal was denied on July 24, 2025, and Apollo filed opposition to a further appeal motion on September 22, 2025. Apollo believes the claims are without merit.
• Anguilla Social Security Board vs. Black et al.: A shareholder derivative complaint filed August 17, 2023, in Delaware Court of Chancery, challenging $570 million payments to Former Managing Partners and Contributing Partners. Defendants' motion to dismiss was denied September 20, 2024. A Special Litigation Committee was formed October 28, 2024, and proceedings are stayed until April 30, 2026. No reasonable estimate of possible loss.
• Class Action Complaint (Delaware Court of Chancery): Filed March 14, 2024, against AGM, alleging certain provisions of the stockholders agreement violate Delaware law. AGM moved to dismiss July 11, 2024. The motion was stayed until January 20, 2026, and briefing will resume with plaintiffs' opposition due March 6, 2026. Apollo believes the claims are without merit.
• German Tax Authorities: The company voluntarily disclosed internal reorganization transactions of fund entities to German tax authorities. While no tax assessment has been received, authorities may seek material assessments. The company believes no such tax is due and intends to contest any assessment vigorously. No reasonable estimate of potential loss.
• Guaranty Association Assessments: Athene recorded $152 million in expenses in 2024 related to assessments from the Bankers Life Insurance Company (BLIC) and Colorado Bankers Life Insurance Company (CBLIC) insolvencies. As of December 31, 2025, potential future assessments are no longer considered material.
• ERISA Class Actions against Athene customers: Beginning March 2024, putative class actions were filed against Athene's customers (plan sponsors) alleging violations of ERISA in connection with pension obligation transfers. Athene is not a named defendant, but negative public perceptions have adversely affected its pension group annuity business.

Related Party Transactions

• Tax Receivable Agreements (TRA): The Apollo TRA provides for payment to Former Managing Partners and Contributing Partners of 85% of U.S. federal, state, local, and foreign income tax savings. The Bridge TRA provides for payment to Bridge TRA holders based on 85% of tax benefits realized from the Bridge acquisition.
• Due from/to Related Parties: Includes unpaid management fees, transaction and advisory fees, and reimbursable expenses from funds and their portfolio companies, as well as employee loans and potential return of profit-sharing distributions.
• Indemnification Liability: Apollo has an indemnification liability of $0.4 million as of December 31, 2025, for personal guarantees made by Former Managing Partners and Contributing Partners related to performance fee repayment obligations.
• Athora: AAM and Athene are minority investors in Athora. AAM has a conditional commitment to invest up to an additional $2.0 billion in Athora. Athene had $29 million in funding agreements outstanding to Athora as of December 31, 2025.
• Atlas: Athene has an equity investment in Atlas and held $5.7 billion of AFS securities issued by Atlas or its affiliates as of December 31, 2025. Athene has commitments to make additional investments in Atlas of $1.8 billion. Two company subsidiaries issued assurance letters to CS to guarantee Atlas's $2.5 billion deferred purchase obligation.
• Catalina: Athene has a strategic modco reinsurance agreement with Catalina affiliates (liability of $103 million in 2025) and a modco reinsurance agreement to cede retail deferred annuity products (reinsurance recoverable of $6.3 billion in 2025).
• Skylign: Athene invests in Skylign Aviation Holdings, LP, and directly held $566 million of Skylign notes as of December 31, 2025.
• Venerable: Athene has a minority equity investment in VA Capital (parent of Venerable) and coinsurance/modco agreements with VIAC (Venerable subsidiary). Athene's investments in VA Capital and Venerable totaled $675 million as of December 31, 2025.
• Wheels: Athene invests in Wheels Inc. indirectly and directly held $949 million of AFS securities issued by Wheels as of December 31, 2025. Athene had commitments to make additional investments in Wheels of $60 million.
• Apollo/Athene Dedicated Investment Programs (ADIP): ACRA 1 and ACRA 2 are partially owned by ADIP I and ADIP II (funds managed by Apollo). Athene held $231 million in ADIP investments as of December 31, 2025, and had commitments of $343 million.
• Apollo Capital Markets Partnership: The company committed equity financing to this consolidated VIE, which has a $2.5 billion revolving credit facility. No capital had been funded by the company to this partnership as of December 31, 2025.

Stakeholder Impact

• Shareholders: Potential for dilution from Mandatory Convertible Preferred Stock conversion, impact of dividend policy, share repurchase program, and volatility in share price. Legal proceedings and tax changes could also affect shareholder value.
• Employees: Compensation and benefits, including equity-based awards and profit sharing, are tied to company performance. Misconduct by employees could lead to termination. Talent development and retention are crucial for continued success.
• Customers (Asset Management): Impacted by investment performance, quality of service, fund terms, and product offerings. Strong AUM growth suggests continued client confidence.
• Policyholders (Retirement Services): Financial strength ratings directly affect confidence in products. Liquidity risk and counterparty risk could impact the ability to meet obligations. Changes in interest rates affect product attractiveness and crediting rates.
• Regulators: The company faces extensive regulation across financial services and insurance industries, with potential for fines, sanctions, and increased scrutiny. Compliance with new tax regimes (Pillar Two, Bermuda CIT) is an ongoing focus.
• Creditors: Impacted by the company's debt obligations, credit ratings, and ability to meet financial covenants. Subordination of junior notes affects payment priority.

Next Steps

• AGM will pay a cash dividend of $0.51 per common stock share on February 27, 2026.
• AGM will pay a cash dividend of $0.8438 per Mandatory Convertible Preferred Stock share on April 30, 2026.
• The company expects to record a full valuation allowance of $1.7 billion against its Bermuda deferred tax assets in the first quarter of 2026.
• Briefing on Apollo's motion to dismiss a class action complaint will resume, with plaintiffs' opposition to be filed on March 6, 2026.
• The acquisition of an approximately $9 billion portfolio of commercial mortgage loans from ARI by Athene is expected to close in the second quarter of 2026.
• The Athora transaction, involving a conditional $2.0 billion investment by AAM, remains subject to closing conditions, including receipt of regulatory approvals and an anticipated capital raise by Athora.
• Management expects to include Bridge in its assessment of internal control over financial reporting for fiscal year 2026.

Key Dates

Recommendation

Apollo Global Management demonstrates strong underlying business growth in AUM and revenues across its Asset Management and Retirement Services segments, supported by strategic acquisitions and robust origination. However, the significant decline in net income, coupled with negative shifts in investment-related gains and market risk benefits, presents a mixed financial performance for 2025. While the long-term tax outlook from Bermuda CIT changes is viewed favorably, the near-term $1.7 billion reduction to equity is a notable headwind. The ongoing legal proceedings and the inherent volatility of performance fees also introduce uncertainty. Given the strong operational expansion balanced against the dip in profitability and specific financial headwinds, a 'hold' recommendation is appropriate for a seasoned investor, suggesting continued monitoring of execution on strategic initiatives and a return to consistent net income growth.

Keywords

Alternative Asset Management, Retirement Services, AUM Growth, Revenue Growth, Net Income Decline, SEC Filing, 10-K, Apollo Global Management, Athene, Bridge Investment Group, Credit Investing, Equity Investing, Annuities, Funding Agreements, Origination, Capital Solutions, Risk Management, Corporate Governance, Regulatory Compliance, Market Risk, Interest Rate Risk, Credit Risk, Cybersecurity, Taxation, Dividends, Acquisitions, Mandatory Convertible Preferred Stock