KKR & Co. Inc. (KKR) Earnings & Analysis

Latest quarter

KKR reported Q2 FY2026 revenue of $5.7 billion, compared with $5.1 billion in Q2 FY2025, a 12.5% increase. Revenue as the consensus counts it was $1.7 billion for the quarter to June 30, 2026, above the $1.5 billion consensus.

KKR reported diluted EPS of $0.70, compared with $0.50 a year earlier, a 40.0% increase. Adjusted EPS, as the consensus counts it, was $1.63, above the $1.42 consensus. Craig Larson said management fees rose 26% year over year to $1.2 billion, supported by fundraising across asset classes and continued deployment.

KKR reported a gross margin of 37.8%, versus 37.9% a year earlier, and an operating margin of 6.89%, versus 8.12%. The company reported free cash flow of $3.2 billion, compared with $371.4 million in Q2 FY2025. Larson said insurance segment operating earnings were $288 million and included approximately $40 million of net realization activity in the alternatives portfolio.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

What management said on the call

Craig Larson said KKR raised $34 billion of new capital in Q2 and deployed $24 billion, with activity diversified across its segments. Larson said management fees were supported by fundraising and deployment, while fee-related earnings were $1.2 billion and the fee-related earnings margin was just above 70%.

Rob Lewin said KKR had $72 billion of committed asset-management capital not yet earning fees, carrying a weighted-average management fee of about 90 basis points when invested or entering its investment period. Lewin said the company expected revenue to grow faster than headcount and expenses if it executed its business plan. He also said the company had raised $305 billion from the beginning of 2024 through June 30, exceeding its three-year fundraising target.

On investment realizations, Larson said Q2 was KKR’s largest monetization quarter, producing $848 million of realized performance income and $220 million of realized investment income. When asked about the quarter ahead, Lewin said KKR had plus or minus $700 million of monetization-related visibility for the quarter, with timing variability tied to take-and-carry in certain funds or partnerships.

Asked about insurance, Lewin said KKR had decided to allocate less capital to the business because of competition. He said the company could not provide a forward organic-growth outlook because liability origination depends on market conditions, while its $6 billion of third-party insurance dry powder could provide more than $60 billion of liability-side buying power. Larson said insurance operating earnings do not capture all economics generated through investment-management fees, insurance-vehicle fees and capital-markets fees.

Scott Nuttall said KKR expected a record third-party credit fundraising year and said private-wealth assets under management had risen over the prior 12 months. Lewin also said KKR changed its K-Series private-equity fee reporting so realized performance fees are included in fee-related performance revenues, which structurally increases forward earnings per share all else equal.

Guidance

KKR said it had removed its formal FY2026 adjusted net income target of $7.00 per share in the prior quarter. Before withdrawing that target, the company had said it was more likely than not to finish below $7.00 per share. Larson said KKR continued to have confidence in more than $350 million of Strategic Holdings operating earnings for 2026, with activity weighted toward the back end of the year.