BlackRock Earnings Plummeted by 60%, Falling Short of Expectations
Assets under management of BlackRock at the conclusion of the quarter totalled $5.98 trillion. This was a drop of 5% over the past year and down 7% in the last quarter. CEO Larry Fink has since revealed that since the end of the quarter BlackRock has managed to increase assets under management above the $6 trillion mark.
Worst December Since the Great Depression
Fink told CNBC’s Squawk Box on Wednesday.
US markets weathered a tough conclusion to 2018. Both the Dow Jones Industrial Average and the S&P 500 experienced a drop of more than 10 percent in the three months ending December. Corporate leaders were uneasy as both the Dow Jones and S&P 500 posted their worst December figures since the Great Depression.
BlackRock sales of $3.434 billion were announced, falling below expectations of $3.516 billion. This represented a dip of 9 percent from the fourth quarter of the previous year. Company stock is down just short of 30 percent in the past year. Job cuts are expected in the coming weeks.
The dismissal of five hundred employees is on the cards, which accounts for approximately 3 percent of BlackRock’s total workforce. In an internal memo seen by CNBC, BlackRock president Rob Kapito claims the cuts are part of a broader effort to “reallocate resources to our most critical growth opportunities.”
Difficult Decisions
Kapito continued that;
Frankfurt-based Deutsche Bank downgraded BlackRock shares from buy to hold late last week, informing clients that they shouldn’t expect much by way of return from asset manager stocks over the coming year.