Carlyle Group Faces Challenges as Buoyed Performance Slips

Carlyle Group's Performance Review

The Carlyle Group Inc. (NASDAQ: CG) is navigating some turbulent waters lately as its shares experience a dip following the release of third-quarter results that fell short of market expectations. This decline has raised concerns among investors and analysts regarding the company's future performance.

Q3 Financial Highlights

In the latest financial report, the Carlyle Group reported an adjusted EPS of $0.96, which is notably lower than the anticipated $1.01. Additionally, revenues hit $782.5 million, also missing the consensus expectations of $1.01 billion. These figures highlight a challenging quarter for the company.

As of September 30, the company recorded Net Accrued Performance Revenues of $2.6 billion, reflecting an 8% decline from the previous quarter. This downturn mainly stems from price declines in certain investments within Carlyle's seventh U.S. buyout fund and fifth Asia buyout fund. Meanwhile, the Realized Net Performance Revenues were $19.1 million, a significant decrease from the previous quarter's $87.7 million.

Positive Aspects Amidst Challenges

Despite the disappointing earnings, there are still positive aspects to consider. Fee-related earnings rose by 12% year-over-year, amounting to $312 million this quarter. Furthermore, the total Assets Under Management (AUM) stood robust at $474 billion as of the end of September.

Insights from the Leadership

Carlyle's Chief Executive Officer, Harvey M. Schwartz, expressed optimism about the company's growth trajectory. In his comments, he noted, "We generated $17 billion of organic quarterly inflows, continued to scale strategic areas like Carlyle AlpInvest and Insurance Solutions, and raised significant capital across our Global Wealth platform." He added that these growth drivers position the company well as it enters 2026, aiming to exceed its updated financial targets.

Dividend Insights

The company's Board of Directors has announced a quarterly common dividend per share of $0.35, which is payable on November 10 to shareholders of record by November 19. The consistent dividend payout reflects Carlyle's commitment to returning value to its shareholders, even in challenging times.

Stock Repurchase Program

In a move to support its stock price, the Carlyle Group has also been active in its stock repurchase program. The company repurchased or withheld 3.3 million shares of common stock, totaling $0.2 billion. As per the latest figures, Carlyle has a repurchase capacity of $0.4 billion remaining under its extensive $1.4 billion buyback authorization.

Market Reaction

As a result of these developments, Carlyle Group shares saw a decline of approximately 7.11%, trading at $52.55. Such fluctuations reflect how sensitive the market can be to earnings reports, particularly when they diverge from analyst forecasts.

Looking Ahead

The current challenges faced by the Carlyle Group serve as a reminder of the volatile nature of investment firms. As the company works to navigate these headwinds, stakeholders will be keenly observing how its strategic initiatives unfold in the coming quarters.

Frequently Asked Questions

What were Carlyle Group's third-quarter earnings?

The Carlyle Group reported an adjusted EPS of $0.96 and revenues of $782.5 million in the third quarter, both missing estimates.

How much is Carlyle's dividend per share?

The Board of Directors declared a quarterly common dividend of $0.35 per share.

What is the total Assets Under Management for Carlyle Group?

Carlyle Group reported total Assets Under Management of $474 billion as of September 30.

Is Carlyle Group active in repurchasing shares?

Yes, Carlyle Group has repurchased 3.3 million shares, totaling $0.2 billion, as part of its stock repurchase program.

What impact did the Q3 results have on Carlyle's stock price?

The shares of Carlyle Group fell approximately 7.11% after the release of the disappointing third-quarter earnings report.

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