Tom Wojcik, Investor Relations

Brian Beades, Media Relations

212.810.8127

212.810.5596

▪

Record $367 billion of full year total net inflows reflects continued strength of diversified business model

▪

$103 billion of fourth quarter net inflows, positive across active, index and iShares^® and cash management

▪

12% full year revenue growth driven by growth in base fees, performance fees, and technology and risk management revenue

▪

15% increase in full year operating income (13% as adjusted) reflects operating margin expansion

▪

59% increase in full year diluted EPS reflects net tax benefit from Tax Cuts and Jobs Act (17% as adjusted)

▪

Returned $2.8 billion to shareholders in 2017

▪

Board of Directors approves 15% increase in quarterly cash dividend to $2.88 per share

Q4

Q4

Q3

Full Year

(in millions, except per share data)

2017

2016

Change

2017

Change

2017

2016

Change

AUM

$

6,288,195

$

5,147,852

22

%

$

5,976,892

5

%

$

6,288,195

$

5,147,852

22

%

Total net flows

$

102,929

$

98,050

$

96,112

$

367,254

$

202,191

GAAP basis:

Revenue

$

3,469

$

2,890

20

%

$

3,233

7

%

$

12,491

$

11,155

12

%

Operating income

$

1,489

$

1,225

22

%

$

1,394

7

%

$

5,272

$

4,570

15

%

Operating margin

42.9

%

42.4

%

50

bps

43.1

%

(20

) bps

42.2

%

41.0

%

120

bps

Net income^{(1) (2)}

$

2,304

$

851

171

%

$

947

143

%

$

4,970

$

3,172

57

%

Diluted EPS

$

14.07

$

5.13

174

%

$

5.78

143

%

$

30.23

$

19.04

59

%

Weighted average diluted shares

163.8

165.9

(1

)%

163.8

-

%

164.4

166.6

(1

)%

As Adjusted:

Operating income⁽³⁾

$

1,492

$

1,232

21

%

$

1,398

7

%

$

5,287

$

4,674

13

%

Operating margin⁽³⁾

44.8

%

44.4

%

40

bps

45.0

%

(20

) bps

44.1

%

43.7

%

40

bps

Net income^{(1) (3)}

$

1,022

$

852

20

%

$

969

5

%

$

3,716

$

3,214

16

%

Diluted EPS⁽³⁾

$

6.24

$

5.14

21

%

$

5.92

5

%

$

22.60

$

19.29

17

%

⁽¹⁾

Net income represents net income attributable to BlackRock, Inc.  

⁽²⁾

GAAP net income for fourth quarter and full year 2017 reflects $1.2 billion of net tax benefit related to the Tax Cuts and Jobs Act.  See page 10 for more information.

⁽³⁾

See notes (1) through (3) to the Condensed Consolidated Statements of Income and Supplemental Information on pages 12 and 13 for more information on as adjusted items and the reconciliation to GAAP.

RESULTS BY CLIENT TYPE

December 31, 2017

Q4 2017

Q4 2017

December 31, 2017

Q4 2017

AUM

Base fees⁽¹⁾

(in millions), (unaudited)

Net flows

AUM

Base fees⁽¹⁾

% of Total

% of Total

Retail

$

11,391

$

628,377

$

858

10

%

29

%

iShares ETFs

54,800

1,752,239

1,123

28

%

39

%

Institutional:

Active

2,187

1,139,308

508

18

%

18

%

Index

12,202

2,316,807

257

37

%

9

%

Total institutional

14,389

3,456,115

765

55

%

27

%

Long-term

80,580

5,836,731

2,746

93

%

95

%

Cash management

23,406

449,949

150

7

%

5

%

Advisory

(1,057

)

1,515

-

-

-

Total

$

102,929

$

6,288,195

$

2,896

100

%

100

%

RESULTS BY PRODUCT TYPE

December 31, 2017

Q4 2017

Q4 2017

December 31, 2017

Q4 2017

AUM

Base fees⁽¹⁾

(in millions), (unaudited)

Net flows

AUM

Base fees⁽¹⁾

% of Total

% of Total

Equity

$

35,782

$

3,371,641

$

1,493

53

%

51

%

Fixed income

42,951

1,855,465

754

30

%

26

%

Multi-asset

4,923

480,278

305

8

%

11

%

Alternatives

(3,076

)

129,347

194

2

%

7

%

Long-term

80,580

5,836,731

2,746

93

%

95

%

Cash management

23,406

449,949

150

7

%

5

%

Advisory

(1,057

)

1,515

-

-

-

Total

$

102,929

$

6,288,195

$

2,896

100

%

100

%

RESULTS BY INVESTMENT STYLE

December 31, 2017

Q4 2017

Q4 2017

December 31, 2017

Q4 2017

AUM

Base fees⁽¹⁾

(in millions), (unaudited)

Net flows

AUM

Base fees⁽¹⁾

% of Total

% of Total

Active

$

12,962

$

1,696,005

$

1,353

27

%

47

%

Index and iShares ETFs

67,618

4,140,726

1,393

66

%

48

%

Long-term

80,580

5,836,731

2,746

93

%

95

%

Cash management

23,406

449,949

150

7

%

5

%

Advisory

(1,057

)

1,515

-

-

-

Total

$

102,929

$

6,288,195

$

2,896

100

%

100

%

⁽¹⁾

Base fees include investment advisory, administration fees and securities lending revenue.

▪

Retail long-term net inflows of $11.4 billion reflected net inflows of $7.4 billion in the United States and $4.0 billion internationally. Fixed income net inflows of $8.0 billion were diversified across our top-performing active platform, led by net inflows into unconstrained, short duration and municipals categories. Multi-asset net inflows of $2.0 billion were largely due to inflows into the Multi-asset Income fund family. Equity net inflows of $1.1 billion were paced by flows into international equities.

▪

iShares ETFs long-term net inflows of $54.8 billion reflected strength in iShares Core, precision exposure and financial instrument ETFs. Equity net inflows of $44.9 billion were driven by both U.S. and international equity market exposures. Fixed income net inflows of $8.7 billion reflected inflows into broad fixed income and investment grade corporate funds. Commodities iShares generated $1.0 billion of net inflows.

▪

Institutional active long-term net inflows of $2.2 billion were led by multi-asset net inflows of $2.9 billion, reflecting ongoing demand for our LifePath^® target-date series and factors strategies, and fixed income net inflows of $2.3 billion. Equity net outflows of $1.2 billion were primarily due to outflows in fundamental active equities. Alternatives net inflows were $2.1 billion, excluding $3.9 billion of capital return associated with real estate and private equity fund-of-funds, or $1.8 billion of total net outflows. Momentum in illiquid alternatives fundraising continued, with $17 billion of committed capital available to invest on behalf of clients.

▪

Institutional index long-term net inflows of $12.2 billion included fixed income net inflows of $24.0 billion, led by demand for liability-driven solutions, partially offset by equity net outflows of $9.0 billion. Alternatives net outflows of $2.5 billion were primarily due to outflows from passive currency overlays.

One-year period

Three-year period

Five-year period

  Fixed income:

  Actively managed AUM above benchmark or peer median

Taxable

81%

73%

90%

Tax-exempt

52%

68%

72%

  Index AUM within or above applicable tolerance

96%

93%

99%

  Equity:

  Actively managed AUM above benchmark or peer median

Fundamental

70%

72%

73%

Systematic

83%

87%

90%

  Index AUM within or above applicable tolerance

96%

99%

98%

⁽¹⁾

Past performance is not indicative of future results. The performance information shown is based on preliminary available data. Please refer to page 14 for performance disclosure detail.

Three Months

Three Months Ended

Ended

December 31,

September 30,

2017

2016

Change

2017

Change

Revenue

Investment advisory, administration fees and

  securities lending revenue

$

2,896

$

2,486

$

410

$

2,792

$

104

Investment advisory performance fees

285

129

156

191

94

Technology and risk management revenue^(a)

180

156

24

175

5

Distribution fees

7

9

(2

)

5

2

Advisory and other revenue^(a)

101

110

(9

)

70

31

Total revenue

3,469

2,890

579

3,233

236

Expense

Employee compensation and benefits

1,147

987

160

1,088

59

Distribution and servicing costs

131

109

22

123

8

Amortization of deferred sales commissions

4

7

(3

)

4

-

Direct fund expense

238

183

55

234

4

General and administration

448

355

93

363

85

Amortization of intangible assets

12

24

(12

)

27

(15

)

Total expense

1,980

1,665

315

1,839

141

Operating income

1,489

1,225

264

1,394

95

Nonoperating income (expense)

Net gain (loss) on investments

33

6

27

41

(8

)

Interest and dividend income

14

7

7

15

(1

)

Interest expense

(46

)

(51

)

5

(46

)

-

Total nonoperating income (expense)

1

(38

)

39

10

(9

)

Income before income taxes

1,490

1,187

303

1,404

86

Income tax expense (benefit)

(820

)

336

(1,156

)

445

(1,265

)

Net income

2,310

851

1,459

959

1,351

Less:

Net income (loss) attributable to noncontrolling interests

6

-

6

12

(6

)

Net income attributable to BlackRock, Inc.

$

2,304

$

851

$

1,453

$

947

$

1,357

Weighted-average common shares outstanding

Basic

161,272,950

163,441,552

(2,168,602

)

161,872,716

(599,766

)

Diluted

163,777,534

165,854,167

(2,076,633

)

163,773,546

3,988

Earnings per share attributable to BlackRock, Inc.

   common stockholders (3)

Basic

$

14.29

$

5.21

$

9.08

$

5.85

$

8.44

Diluted

$

14.07

$

5.13

$

8.94

$

5.78

$

8.29

Cash dividends declared and paid per share

$

2.50

$

2.29

$

0.21

$

2.50

$

-

Supplemental information:

AUM (end of period)

$

6,288,195

$

5,147,852

$

1,140,343

$

5,976,892

$

311,303

Shares outstanding (end of period)

161,046,825

163,121,291

(2,074,466

)

161,597,770

(550,945

)

GAAP:

Operating margin

42.9

%

42.4

%

50

bps

43.1

%

(20

) bps

Effective tax rate

(55.2

)%

28.3

%

(8,350

) bps

32.0

%

(8,720

) bps

As adjusted:

Operating income (1)

$

1,492

$

1,232

$

260

$

1,398

$

94

Operating margin (1)

44.8

%

44.4

%

40

bps

45.0

%

(20

) bps

Nonoperating income (expense), less net income

  (loss) attributable to noncontrolling interests

$

(5

)

$

(38

)

$

33

$

(2

)

$

(3

)

Net income attributable to BlackRock, Inc. (2)

$

1,022

$

852

$

170

$

969

$

53

Diluted earnings attributable to BlackRock, Inc.

     common stockholders per share (2) (3)

$

6.24

$

5.14

$

1.10

$

5.92

$

0.32

Effective tax rate

31.3

%

28.6

%

270

bps

30.6

%

70

bps

See pages 12-13 for the reconciliation to GAAP and notes (1) through (3) for more information on as adjusted items.

Year Ended

December 31,

2017

2016

Change

Revenue

Investment advisory, administration fees and securities

      lending revenue

$

10,893

$

9,880

$

1,013

Investment advisory performance fees

594

295

299

Technology and risk management revenue^(a)

677

595

82

Distribution fees

24

41

(17

)

Advisory and other revenue^(a)

303

344

(41

)

Total revenue

12,491

11,155

1,336

Expense

Employee compensation and benefits

4,255

3,880

375

Distribution and servicing costs

492

429

63

Amortization of deferred sales commissions

17

34

(17

)

Direct fund expense

904

766

138

General and administration

1,462

1,301

161

Restructuring charge

-

76

(76

)

Amortization of intangible assets

89

99

(10

)

Total expense

7,219

6,585

634

Operating income

5,272

4,570

702

Nonoperating income (expense)

Net gain (loss) on investments

161

55

106

Interest and dividend income

49

40

9

Interest expense

(205

)

(205

)

-

Total nonoperating income (expense)

5

(110

)

115

Income before income taxes

5,277

4,460

817

Income tax expense

270

1,290

(1,020

)

Net income

5,007

3,170

1,837

Less:

Net income (loss) attributable to noncontrolling interests

37

(2

)

39

Net income attributable to BlackRock, Inc.

$

4,970

$

3,172

$

1,798

Weighted-average common shares outstanding

Basic

162,160,601

164,425,858

(2,265,257

)

Diluted

164,415,035

166,579,752

(2,164,717

)

Earnings per share attributable to BlackRock, Inc.

   common stockholders (3)

Basic

$

30.65

$

19.29

$

11.36

Diluted

$

30.23

$

19.04

$

11.19

Cash dividends declared and paid per share

$

10.00

$

9.16

$

0.84

Supplemental information:

AUM (end of period)

$

6,288,195

$

5,147,852

$

1,140,343

Shares outstanding (end of period)

161,046,825

163,121,291

(2,074,466

)

GAAP:

Operating margin

42.2

%

41.0

%

120

bps

Effective tax rate

5.2

%

28.9

%

(2,370

) bps

As adjusted:

Operating income (1)

$

5,287

$

4,674

$

613

Operating margin (1)

44.1

%

43.7

%

40

bps

Nonoperating income (expense), less net income (loss)

     attributable to noncontrolling interests

$

(32

)

$

(108

)

$

76

Net income attributable to BlackRock, Inc. (2)

$

3,716

$

3,214

$

502

Diluted earnings attributable to BlackRock, Inc.

     common stockholders per share (2) (3)

$

22.60

$

19.29

$

3.31

Effective tax rate

29.3

%

29.6

%

(30

) bps

See pages 12-13 for the reconciliation to GAAP and notes (1) through (3) for more information on as adjusted items.

Current Quarter Component Changes by Client Type and Product Type

Net

September 30,

inflows

Market

December 31,

2017

(outflows)

change

FX impact ⁽¹⁾

2017

Average AUM ⁽²⁾

Retail:

Equity

$

225,668

$

1,135

$

5,706

$

709

$

233,218

$

229,625

Fixed income

248,348

8,006

652

565

257,571

252,740

Multi-asset

118,062

1,990

682

121

120,855

119,514

Alternatives

16,443

260

(17

)

47

16,733

16,562

Retail subtotal

608,521

11,391

7,023

1,442

628,377

618,441

iShares ETFs:

Equity

1,228,395

44,888

54,910

1,417

1,329,610

1,284,240

Fixed income

386,267

8,672

(608

)

921

395,252

390,409

Multi-asset

3,491

262

8

-

3,761

3,670

Alternatives

22,284

978

341

13

23,616

22,874

iShares ETFs subtotal

1,640,437

54,800

54,651

2,351

1,752,239

1,701,193

Institutional:

Active:

Equity

130,366

(1,236

)

7,658

397

137,185

133,465

Fixed income

562,027

2,313

4,832

878

570,050

565,001

Multi-asset

327,733

2,910

15,635

1,547

347,825

336,773

Alternatives

85,098

(1,800

)

749

201

84,248

84,400

Active subtotal

1,105,224

2,187

28,874

3,023

1,139,308

1,119,639

Index:

Equity

1,588,036

(9,005

)

89,810

2,787

1,671,628

1,634,336

Fixed income

591,778

23,960

13,835

3,019

632,592

609,295

Multi-asset

7,741

(239

)

328

7

7,837

7,826

Alternatives

7,146

(2,514

)

101

17

4,750

5,404

Index subtotal

2,194,701

12,202

104,074

5,830

2,316,807

2,256,861

Institutional subtotal

3,299,925

14,389

132,948

8,853

3,456,115

3,376,500

Long-term

5,548,883

80,580

194,622

12,646