KKR & Co. Inc.

Previous wording

Our asset management business offers a broad range of investment management services to fund investors around the world. Throughout our history, we have consistently been a leader in the private equity industry, having completed more than 780 private equity investments in portfolio companies with a total transaction value in excess of $800 billion as of March 31, 2025. Since the inception of our firm in 1976, we have expanded our investment strategies and product offerings from traditional private equity to areas such as leveraged credit, alternative credit, infrastructure, energy, real estate, growth equity (including technology, health care, and impact strategies), and core private equity. We also provide capital markets services for our firm, our portfolio companies, and third parties. Our balance sheet provides a significant source of capital for the growth and expansion of our business, which has allowed us to further align our interests with those of our investment vehicle investors. Building on these efforts and leveraging our industry expertise and intellectual capital have allowed us to capitalize on a broader range of the opportunities we source.

Current wording

Our asset management business offers a broad range of investment management services to fund investors around the world. Throughout our history, we have consistently been a leader in the private equity industry, having completed more than 790 private equity investments in portfolio companies with a total transaction value in excess of $815 billion as of June 30, 2025. Since the inception of our firm in 1976, we have expanded our investment strategies and product offerings from traditional private equity to areas such as leveraged credit, alternative credit, infrastructure, energy, real estate, growth equity (including technology, health care, and impact strategies), and core private equity. We also provide capital markets services for our firm, our portfolio companies, and third parties. Our balance sheet provides a significant source of capital for the growth and expansion of our business, which has allowed us to further align our interests with those of our investment vehicle investors. Building on these efforts and leveraging our industry expertise and intellectual capital have allowed us to capitalize on a broader range of the opportunities we source.

Previous wording

Our insurance business is operated by our wholly-owned subsidiary Global Atlantic, which is a leading retirement and life insurance company that provides a broad suite of protection, legacy and savings products, and reinsurance solutions to clients across individual and institutional markets. Global Atlantic primarily offers individuals fixed-rate annuities, fixed-indexed annuities, and targeted life products through a network of banks, broker-dealers, and independent marketing organizations. Global Atlantic provides its institutional clients customized reinsurance solutions, including block, flow, and pension risk transfer reinsurance, as well as funding agreements. Global Atlantic primarily generates income by earning a spread between its investment income and the cost of policyholder benefits. As of March 31, 2025, Global Atlantic served over three and a half million policyholders.

Current wording

Our insurance business is operated by our wholly-owned subsidiary Global Atlantic, which is a leading retirement and life insurance company that provides a broad suite of protection, legacy and savings products, and reinsurance solutions to clients across individual and institutional markets. Global Atlantic primarily offers individuals fixed-rate annuities, fixed-indexed annuities, and targeted life products through a network of banks, broker-dealers, and independent marketing organizations. Global Atlantic provides its institutional clients customized reinsurance solutions, including block, flow, and pension risk transfer, as well as funding agreements. Global Atlantic primarily generates income by earning a spread between its investment income and the cost of policyholder benefits. As of June 30, 2025, Global Atlantic served over three and a half million policyholders.

Previous wording

Our asset management business offers a broad range of investment management services to fund investors around the world. In our asset management business, we have five business lines: (1) Private Equity, (2) Real Assets, (3) Credit and Liquid Strategies, (4) Capital Markets, and (5) Principal Activities. In addition to the overviews of each of these business lines provided in this report, please also refer to our Annual Report. As an asset management firm, we earn fees, including management fees and incentive fees, and carried interest for providing investment management and other services to our investment vehicles, CLOs, managed accounts, portfolio companies, and certain operating companies, and we generate transaction fees from capital markets transactions. We earn additional investment income by investing our own capital alongside investors in our investment vehicles and from other assets on our balance sheet. Carried interest we receive from our funds and certain other investment vehicles entitles us to a specified percentage of investment gains that are generated on third-party capital that is invested.

Current wording

Our asset management business offers a broad range of investment management services to fund investors around the world. In our asset management business, we have five business lines: (1) Private Equity, (2) Real Assets, (3) Credit and Liquid Strategies, (4) Capital Markets, and (5) Principal Activities. In addition to the overviews of each of these business lines provided in this report, please also refer to our Annual Report. As an asset management firm, we earn fees, including management fees and incentive fees, and carried interest for providing investment management and other services to our investment vehicles, CLOs, managed accounts, portfolio companies, and certain operating companies, and we generate transaction fees from capital markets transactions. We earn additional investment income by investing our own capital alongside investors in our investment vehicles and from other assets on our balance sheet. Carried interest we receive from our funds and certain other investment vehicles entitles us to a specified percentage of investment gains that are generated on third-party capital that is invested. Subsequent to June 30, 2025, KKR acquired a majority ownership stake in HealthCare Royalty Partners, a middle-market biopharma royalty acquisition company, which manages approximately $3 billion of assets.

Previous wording

Through our Private Equity business line, we manage and sponsor a group of private equity funds that invest capital for long-term appreciation, either through controlling ownership of a company or strategic non-controlling minority positions. In addition to our traditional private equity funds that invest in large and mid-sized companies, we sponsor funds that invest in core private equity, growth equity, and impact investments. Our Private Equity business line includes separately managed accounts that invest in multiple strategies, which may include our credit and real assets strategies, as well as our private equity strategies. These funds and accounts are managed by Kohlberg Kravis Roberts & Co. L.P., an SEC-registered investment adviser. As of March 31, 2025, our Private Equity business line had $209.4 billion of AUM, consisting of $151.6 billion in traditional private equity, $39.1 billion in core private equity and $18.7 billion in growth equity, which includes $4.4 billion of impact investments.

Current wording

Through our Private Equity business line, we manage and sponsor a group of private equity investment vehicles that invest capital for long-term appreciation, either through controlling ownership of a company or strategic non-controlling minority positions. In addition to our traditional private equity funds that invest in large and mid-sized companies, we sponsor funds that invest in core private equity and growth equity, which includes technology, health care, and impact strategies. Our Private Equity business line includes separately managed accounts that invest in multiple strategies, which may include our credit and real assets strategies, as well as our private equity strategies. These funds and accounts are managed by Kohlberg Kravis Roberts & Co. L.P., an SEC-registered investment adviser. As of June 30, 2025, our Private Equity business line had $214.6 billion of AUM, consisting of $156.9 billion in traditional private equity, $39.6 billion in core private equity and $18.1 billion in growth equity, which includes $4.5 billion of impact investments.

Previous wording

(8)"Unallocated Commitments" represent commitments received from our strategic investor partnerships that have yet to be allocated to a particular investment strategy.

Current wording

(6)"Unallocated Commitments" represent commitments received from our strategic investor partnerships that have yet to be allocated to a particular investment strategy.

Previous wording

Through our Real Assets business line, we manage and sponsor a group of real assets funds and accounts that invest capital in infrastructure, real estate, or energy. These funds and accounts are managed by Kohlberg Kravis Roberts & Co. L.P. or one of its subsidiaries. As of March 31, 2025, our Real Assets business line had $171.3 billion of AUM, consisting of $83.4 billion in infrastructure, $81.3 billion in real estate (of which $43.6 billion is real estate credit and $37.7 billion is real estate equity), $5.2 billion in energy, and $1.4 billion of unallocated commitments from a strategic investment partnership.

Current wording

Through our Real Assets business line, we manage and sponsor a group of real assets funds and accounts that invest capital in infrastructure, real estate, or energy. These funds and accounts are managed by Kohlberg Kravis Roberts & Co. L.P. or one of its subsidiaries. As of June 30, 2025, our Real Assets business line had $179.4 billion of AUM, consisting of $90.5 billion in infrastructure, $82.5 billion in real estate (of which $43.6 billion is real estate credit and $38.9 billion is real estate equity), $5.0 billion in energy, and $1.4 billion of unallocated commitments from a strategic investment partnership.

Previous wording

Through our Credit and Liquid Strategies business line, we report our credit and hedge funds platforms on a combined basis. As of March 31, 2025, our Credit and Liquid Strategies business line had $283.6 billion of AUM, comprised of $129.1 billion of assets managed in our leveraged credit strategies, $74.2 billion of assets in asset-based finance, $42.8 billion in direct lending, $7.7 billion of assets managed in our SIG strategy, and $29.8 billion of assets managed through our hedge fund platform, which we refer to as the liquid strategies component of our credit and liquid strategies business. Asset-based finance and direct lending together represent our private credit strategy. We manage $145.9 billion of credit investments for our Global Atlantic insurance companies. Our BDCs have approximately $16.2 billion in assets under management, which is reflected in the AUM of our credit strategies above. We report all of the assets under management of our BDCs in our AUM, but we report only a pro rata portion of the assets under management of our hedge fund partnerships based on our percentage ownership in them.

Current wording

Through our Credit and Liquid Strategies business line, we report our credit and hedge funds platforms on a combined basis. As of June 30, 2025, our Credit and Liquid Strategies business line had $291.8 billion of AUM, comprised of $134.0 billion of assets managed in our leveraged credit strategies, $75.0 billion of assets in asset-based finance, $44.8 billion in direct lending, $7.6 billion of assets managed in our SIG strategy, and $30.4 billion of assets managed through our hedge fund platform, which we refer to as the liquid strategies component of our credit and liquid strategies business. Asset-based finance and direct lending together represent our private credit strategy. We manage $149.2 billion of credit investments for our Global Atlantic insurance companies. Our BDCs have approximately $16.2 billion in assets under management, which is reflected in the AUM of our credit strategies above. We report all of the assets under management of our BDCs in our AUM, but we report only a pro rata portion of the assets under management of our hedge fund partnerships based on our percentage ownership in them.

Previous wording

Global Atlantic also sponsors co-investment vehicles (the "sponsored reinsurance vehicles") to participate alongside Global Atlantic in certain block, flow, PRT and other reinsurance transactions that Global Atlantic enters into during the vehicles’ respective investment periods. The sponsored reinsurance vehicles provide third-party capital to support reinsurance transactions and generally are not consolidated into our financial statements. As of March 31, 2025, third parties have committed capital to the sponsored reinsurance vehicles of approximately $7.2 billion, of which $3.1 billion has been deployed.

Current wording

Global Atlantic also sponsors co-investment vehicles ("Ivy and other co-investment vehicles") that provide third-party capital to support Global Atlantic’s business. Ivy and other co-investment vehicles participate alongside Global Atlantic, primarily in certain block, flow, PRT, and other reinsurance transactions that Global Atlantic enters into during the vehicles’ respective investment periods. Ivy and other co-investment vehicles generally are not consolidated into our financial statements. As of June 30, 2025, third parties have committed capital to Ivy and other co-investment vehicles of approximately $7.5 billion, of which $3.2 billion has been deployed. Following the end of the quarter, on July 30, 2025, Global Atlantic announced an additional $2 billion commitment to a co-investment vehicle that, subject to regulatory approvals, is expected to access certain insurance, reinsurance, and strategic transactions of Global Atlantic.

Previous wording

In addition to the overview of our insurance business operated by Global Atlantic provided in this report, please also refer to our Annual Report. The following table represents Global Atlantic’s new business volumes by business and product for the three months ended March 31, 2025 and 2024:

Current wording

In addition to the overview of our insurance business operated by Global Atlantic provided in this report, please also refer to our Annual Report. The following table represents Global Atlantic’s new business volumes by business and product for the three and six months ended June 30, 2025 and 2024:

Previous wording

(1)As of March 31, 2025, 82% of the account value in Global Atlantic's general account associated with its fixed-rate and fixed-indexed annuity products, and 40% of account value in its general account associated with universal life products was protected by surrender charges.

Current wording

(1)As of June 30, 2025, 83% of the account value in Global Atlantic's general account associated with its fixed-rate and fixed-indexed annuity products, and 39% of account value in its general account associated with universal life products was protected by surrender charges.

Previous wording

(4)Institutional market reserves are sourced using customized reinsurance solutions such as block, flow and PRT. As of March 31, 2025, reserves sourced through block, flow and PRT transactions were $62.4 billion, $32.6 billion and $6.3 billion, respectively.

Current wording

(4)Institutional market reserves are sourced using customized reinsurance solutions such as block, flow and PRT. As of June 30, 2025, reserves sourced through block, flow and PRT transactions were $61.3 billion, $34.5 billion and $6.5 billion, respectively.

Previous wording

As of March 31, 2025, our Strategic Holdings segment consisted of our ownership stakes in 18 companies that we acquired through our core private equity strategy. Based on certain information made available to management as of March 31, 2025, approximately 69% of these companies are based in the Americas, 25% in Europe, and 6% in the Asia-Pacific (based on the geographic location of their headquarters). In addition, based on such information, these companies are primarily engaged in the following business sectors: approximately 36% in Business Services, 29% in Consumer, 13% in technology-media-telecommunications (TMT), 13% in Healthcare, and 9% in Infrastructure. We currently expect our Strategic Holdings segment to generate income from the receipt of dividends from our ownership stakes in these businesses, and if any ownership stake were to be sold, we would recognize realized investment income from such sale.

Current wording

As of June 30, 2025, our Strategic Holdings segment consisted of our ownership stakes in 18 companies that we acquired through our core private equity strategy. Based on certain information made available to management as of June 30, 2025, approximately 70% of these companies are based in the Americas, 25% in Europe, and 5% in the Asia-Pacific (based on the geographic location of their headquarters). In addition, based on such information, these companies are primarily engaged in the following business sectors: approximately 36% in Business Services, 28% in Consumer, 14% in Healthcare, 13% in technology-media-telecommunications (TMT), and 9% in Infrastructure. We currently expect our Strategic Holdings segment to generate income from the receipt of dividends from our ownership stakes in these businesses, and if any ownership stake were to be sold, we would recognize realized investment income from such sale.

Previous wording

The United States, during the first quarter of 2025, experienced a contraction in economic growth while also continuing to experience persistent inflation in excess of the U.S. Federal Reserve Board’s target rate. The U.S. Federal Reserve Board decided to maintain the target range unchanged at 4.25% to 4.50% for the federal funds rate noting inflation, including potential increases in inflation relating to trade and tariff policies, as a consideration in deciding to leave the target range unchanged.

Current wording

The United States, during the second quarter of 2025, experienced an expansion in economic growth while also continuing to experience persistent inflation in excess of the U.S. Federal Reserve Board’s target rate. The U.S. Federal Reserve Board decided to maintain the target range unchanged at 4.25% to 4.50% for the federal funds rate noting inflation, including potential increases in inflation relating to trade and tariff policies, as a consideration in deciding to leave the target range unchanged.

Previous wording

GDP growth in the Eurozone during the first quarter of 2025 was moderately positive. In Europe during the first quarter 2025, the European Central Bank lowered rates for the sixth time since June 2024, lowering the deposit rate to 2.5% as Eurozone inflation slowed as compared to the prior quarter albeit remaining above the European Central Bank’s 2% inflation target.

Current wording

GDP growth in the Eurozone during the second quarter of 2025 was moderately positive. In Europe during the second quarter 2025, the European Central Bank continued to lower rates with two rate decreases in the quarter, lowering the deposit rate to 2.0% as Eurozone inflation slowed as compared to the prior quarter albeit remaining above the European Central Bank’s 2% inflation target.

Previous wording

In Asia, the two largest economies continued to experience divergent economic conditions during the first quarter of 2025. Japan’s economy is expected to have experienced positive growth in the first quarter of 2025. The Bank of Japan raised interest rates during the first quarter of 2025, ultimately up to 0.50%. In China, the economy grew during the first quarter of 2025, but Chinese growth remains subject to various headwinds including in the property sector and uncertainty relating to a potential trade war with the United States as discussed further below.

Current wording

In Asia, Japan’s economy is expected to have experienced positive growth in the second quarter of 2025. The Bank of Japan kept interest rates flat during the second quarter of 2025, leaving its policy rate at 0.50%. In China, the economy grew during the second quarter of 2025 but continued to experience divergent economic conditions and headwinds as compared to Japan as Chinese growth remains subject to various headwinds including in the property sector and uncertainty relating to a potential trade war with the United States as discussed further below.

Previous wording

•GDP. In the United States, real gross domestic product (“GDP”) contracted by -0.3% for the quarter ended March 31, 2025, compared to an expansion of 2.4% for the quarter ended December 31, 2024. Eurozone real GDP increased by 0.4% for the quarter ended March 31, 2025, up from 0.2% expansion for the quarter ended December 31, 2024. In Japan, real GDP is estimated to have increased by 0.3% for the quarter ended March 31, 2025, down from a 2.2% expansion for the quarter ended December 31, 2024. Real GDP in China increased by 4.8% for the quarter ended March 31, 2025, compared to an expansion of 6.4% reported for the quarter ended December 31, 2024.

Current wording

•GDP. In the United States, real gross domestic product (“GDP”) expanded by 3.0% for the three months ended June 30, 2025, compared to a contraction of -0.5% for the three months ended March 31, 2025. Eurozone real GDP expanded by 0.1% for the three months ended June 30, 2025, down from a 0.6% expansion for the three months ended March 31, 2025. In Japan, real GDP is estimated to have increased by 0.3% for the three months ended June 30, 2025, up from a -0.2% contraction for the three months ended March 31, 2025. Real GDP in China increased by 4.4% for the three months ended June 30, 2025, compared to an expansion of 4.8% reported for the three months ended March 31, 2025.

Previous wording

•Interest Rates. The effective federal funds rate set by the U.S. Federal Reserve Board was 4.33% as of March 31, 2025, unchanged from December 31, 2024. The short-term benchmark interest rate set by the European Central Bank was 2.65% as of March 31, 2025, down from 3.15% as of December 31, 2024. The short-term benchmark interest rate set by the Bank of Japan was 0.50% as of March 31, 2025, up from 0.25% as of December 31, 2024. The short-term benchmark interest rate set by The People's Bank of China was 3.10% as of March 31, 2025, unchanged from December 31, 2024.

Current wording

•Interest Rates. The effective federal funds rate set by the U.S. Federal Reserve Board was 4.33% as of June 30, 2025, unchanged from March 31, 2025. The short-term benchmark interest rate set by the European Central Bank was 2.15% as of June 30, 2025, down from 2.65% as of March 31, 2025. The short-term benchmark interest rate set by the Bank of Japan was 0.50% as of June 30, 2025 with no change as compared with the rate as of March 31, 2025. The benchmark interest rate set by The People's Bank of China was 3.0% as of June 30, 2025, down from 3.1% as of March 31, 2025.

Previous wording

•Inflation. The U.S. core consumer price index rose 2.8% on a year-over-year basis as of March 31, 2025, down from 3.2% on a year-over-year basis as of December 31, 2024. Eurozone core inflation was 2.4% as of March 31, 2025, down from 2.7% as of December 31, 2024. In Japan, core inflation rose 1.6% on a year-over-year basis as of March 31, 2025, flat from 1.6% on a year-over-year basis as of December 31, 2024. Core inflation in China was 0.5% on a year-over-year basis as of March 31, 2025, up from 0.4% as of December 31, 2024.

Current wording

•Inflation. The U.S. core consumer price index rose 2.9% on a year-over-year basis as of June 30, 2025, up from 2.8% on a year-over-year basis as of March 31, 2025. Eurozone core inflation was 2.3% as of June 30, 2025, down from 2.4% as of March 31, 2025. In Japan, core inflation rose 1.6% on a year-over-year basis as of June 30, 2025, flat from 1.6% on a year-over-year basis as of March 31, 2025. Core inflation in China was 0.7% on a year-over-year basis as of June 30, 2025, up from 0.5% as of March 31, 2025.

Previous wording

•Unemployment. The U.S. unemployment rate was 4.2% as of March 31, 2025, up from 4.1% as of December 31, 2024. Eurozone unemployment was 6.1% as of March 31, 2025, down from 6.2% as of December 31, 2024. The unemployment rate in Japan was 2.4% as of March 31, 2025, down from 2.5% as of December 31, 2024. The unemployment rate in China was 5.2% as of March 31, 2025, up from 5.0% as of December 31, 2024.

Current wording

•Unemployment. The U.S. unemployment rate was 4.1% as of June 30, 2025, down from 4.2% as of March 31, 2025. Eurozone unemployment was 6.3% as of June 30, 2025, down from 6.4% as of March 31, 2025. The unemployment rate in Japan was 2.5% as of June 30, 2025, unchanged from March 31, 2025. The unemployment rate in China was 5.2% as of June 30, 2025, up from 5.0% as of March 31, 2025.

Previous wording

•Equity Markets. For the quarter ended March 31, 2025, the S&P 500 was down 4.7%, the MSCI Europe Index was up 12.4%, the MSCI Asia Index was up 0.6% and the MSCI World Index was down -2.0%% on a total return basis including dividends. Equity market volatility as evidenced by the Chicago Board Options Exchange Market Volatility Index (VIX), a measure of volatility, ended at 22.3 as of March 31, 2025, increasing from 17.4 as of December 31, 2024.

Current wording

•Equity Markets. For the three months ended June 30, 2025, the S&P 500 was up 10.9%, the MSCI Europe Index was up 13.3%, the MSCI Asia Index was up 12.5% and the MSCI World Index was up 11.6% on a total return basis including dividends. Equity market volatility as evidenced by the Chicago Board Options Exchange Market Volatility Index (VIX), a measure of volatility, ended at 16.7 as of June 30, 2025, decreasing from 22.3 as of March 31, 2025.

Previous wording

•Credit Markets. During the quarter ended March 31, 2025, U.S. investment grade corporate bond spreads (BofA Merrill Lynch US Corporate Index) widened by 15 basis points. The non-investment grade credit indices were up during the quarter ended March 31, 2025 with the S&P/LSTA Leveraged Loan Index up 0.5% and the BofAML HY Master II Index up 1.0%. During the quarter ended March 31, 2025, the 10-year government bond yields fell 36 basis points in the United States, rose 37 basis points in Germany, rose 39 basis points in Japan, rose 11 basis points in the UK and rose 15 basis points in China.

Current wording

•Credit Markets. During the three months ended June 30, 2025, U.S. investment grade corporate bond spreads (BofA Merrill Lynch US Corporate Index) widened by 15 basis points. The non-investment grade credit indices were up during the three months ended June 30, 2025 with the S&P/LSTA Leveraged Loan Index up 2.3% and the BofAML HY Master II Index up 3.6%. During the three months ended June 30, 2025, the 10-year government bond yields rose 2 basis points in the United States, fell 13 basis points in Germany, fell 6 basis points in Japan, fell 19 basis points in the UK and fell 16 basis points in China.

Previous wording

•Commodity Markets. During the quarter ended March 31, 2025, the 3-year forward price of WTI crude oil decreased approximately 2.3%, and the 3-year forward price of natural gas decreased from approximately $4.46 per MMBtu as of December 31, 2024 to $3.59 per MMBtu as of March 31, 2025. The Japan spot LNG import price increased to approximately $15.31 per MMBtu as of March 31, 2025 from approximately $13.82 per MMBtu as of December 31, 2024.

Current wording

•Commodity Markets. During the three months ended June 30, 2025, the 3-year forward price of WTI crude oil decreased approximately 2.9%, and the 3-year forward price of natural gas decreased from approximately $3.59 per MMBtu as of March 31, 2025 to $3.25 per MMBtu as of June 30, 2025. The Japan spot LNG import price decreased to approximately $11.48 per MMBtu as of June 30, 2025 from approximately $15.31 per MMBtu as of March 31, 2025.

Previous wording

•Foreign Exchange Rates. For the quarter ended March 31, 2025, the euro rose 4.5%, the British pound rose 3.2%, the Japanese yen rose 4.8%, and the Chinese renminbi rose 0.6%, respectively, relative to the U.S. dollar.

Current wording

•Foreign Exchange Rates. For the three months ended June 30, 2025, the euro rose 9.0%, the British pound rose 6.3%, the Japanese yen rose 4.1%, and the Chinese renminbi rose 1.3%, respectively, relative to the U.S. dollar.

Previous wording

Beginning in March 2025 and continuing through the date of the filing of this report, the United States and countries around the world have experienced elevated levels of market volatility and uncertainty driven principally by geopolitical and global trade concerns, including, in particular, the announcements of the imposition of tariffs by the United States on certain of its trading partners in April 2025 and certain retaliation by such trade partners. This volatility and uncertainty adds to the various risks and uncertainties in the business environment in which we operate and may have various impacts, including on the valuations of certain of our and our investment vehicles' investments, the pace and volume of our capital market transactions, deployments, and realizations, and our fundraising activities.

Current wording

Beginning in March 2025 and continuing through the date of the filing of this report, the United States and countries around the world have experienced elevated levels of market volatility and uncertainty driven principally by geopolitical and global trade concerns, including, in particular, the announcements of the imposition of tariffs by the United States on certain of its trading partners since April 2025 and certain retaliation by such trade partners. This volatility and uncertainty adds to the various risks and uncertainties in the business environment in which we operate and may have various impacts, including on the valuations of certain of our and our investment vehicles' investments, the pace and volume of our capital market transactions, deployments, and realizations, and our fundraising activities.

Previous wording

Total Segment Earnings is a performance measure that KKR believes is useful to stockholders as it provides a supplemental measure of our operating performance without taking into account items that KKR does not believe arise from or relate directly to KKR's operations. Total Segment Earnings excludes: (i) equity-based compensation charges, (ii) amortization of acquired intangibles, and (iii) transaction-related and non-operating items, if any. Transaction-related and non-operating items arise from corporate actions and non-operating items, which consist of: (i) impairments, (ii) transaction costs from acquisitions, (iii) depreciation on real estate that KKR owns and occupies, (iv) contingent liabilities, net of any recoveries, and (v) other gains or charges that affect period-to-period comparability and are not reflective of KKR's ongoing operational performance. Inter-segment transactions are not eliminated from segment results when management considers those transactions in assessing the results of the respective segments. These transactions include (i) management fees earned by our Asset Management segment as the investment adviser for Global Atlantic insurance companies, (ii) management and performance fees earned by our Asset Management segment for acquiring and managing the companies included in our Strategic Holdings segment, and (iii) interest income and expense based on lending arrangements where our Asset Management segment borrows from our Insurance segment. All these inter-segment transactions are recorded by each segment based on the applicable governing agreements. Additionally, due to the integrated nature of our segment operations and as part of our strategic capital allocation decisions, intersegment asset transfers may occur. In these cases in segment reporting, the assets are transferred at their fair value, and no gain or loss is recognized at the time of transfer. Earnings are recognized upon realization events and transactions with third parties. Total Segment Earnings represents the total segment earnings of KKR’s Asset Management, Insurance and Strategic Holdings segments.

Current wording

Total Segment Earnings is a performance measure that KKR believes is useful to stockholders as it provides a supplemental measure of our operating performance without taking into account items that KKR does not believe arise from or relate directly to KKR's operations. Total Segment Earnings excludes: (i) equity-based compensation charges, (ii) amortization of acquired intangibles, and (iii) transaction-related and non-operating items, if any. Transaction-related and non-operating items arise from corporate actions and non-operating items, which consist of: (i) impairments, (ii) transaction costs from acquisitions, (iii) depreciation on real estate that KKR owns and occupies, (iv) contingent liabilities, net of any recoveries, and (v) other gains or charges that affect period-to-period comparability and are not reflective of KKR's ongoing operational performance. Inter-segment transactions are not eliminated from segment results when management considers those transactions in assessing the results of the respective segments. These transactions include (i) management fees earned by our Asset Management segment as the investment adviser for Global Atlantic insurance companies, (ii) management and performance fees earned by our Asset Management segment for acquiring and managing the companies included in our Strategic Holdings segment, and (iii) interest income and expense based on lending arrangements where our Asset Management segment borrows from our Insurance segment. All these inter-segment transactions are recorded by each segment based on the applicable governing agreements. Additionally, due to the integrated nature of our segment operations and as part of our strategic capital allocation decisions, intersegment asset transfers have and may continue to occur. In these cases in segment reporting, the assets are transferred at their fair value, and no gain or loss is recognized at the time of transfer. Earnings are recognized upon realization events and transactions with third parties. Total Segment Earnings represents the total segment earnings of KKR’s Asset Management, Insurance and Strategic Holdings segments.

Previous wording

Total Fees and Other for the three months ended March 31, 2025 increased compared to the three months ended March 31, 2024 primarily as a result of the increase in transaction fees and management fees, partially offset by an increase in fee credits.

Current wording

Total Fees and Other for the three months ended June 30, 2025, increased compared to the three months ended June 30, 2024, primarily as a result of an increase in management fees and transaction fees, which were partially offset by an increase in fee credits.

Previous wording

The increase in management fees was primarily attributable to (i) management fees commencing at Global Infrastructure Investors V in the third quarter of 2024 and (ii) management fees earned on new capital raised over the past twelve months by our private equity and infrastructure K-Series vehicles. The increase was partially offset by (i) a lower level of management fees earned from Ascendant (our U.S. middle market traditional private equity strategy fund) due to management fees earned on new capital raised in the first quarter of 2024 that were retroactive to the start of the fund's investment period and no such retroactive fees were earned in the current period, (ii) a decrease in management fees earned from Global Infrastructure Investors IV as a result of entering its post-investment period in the third quarter of 2024, and now pays fees based on invested capital rather than committed capital, and (iii) a lower level of management fees from Asian Fund III due to a step-down in the management fee rate and a decrease in invested capital subsequent to the first quarter of 2024.

Current wording

The increase in management fees was primarily attributable to (i) management fees commencing at North America Fund XIV in the second quarter of 2025 (ii) management fees commencing at Global Infrastructure Investors V in the third quarter of 2024, and (iii) management fees earned on new capital raised over the past twelve months by our private equity and infrastructure K-Series vehicles. The increase was partially offset by (i) a lower level of management fees earned from Ascendant (our U.S. middle market traditional private equity strategy fund) due to management fees earned on new capital raised in the second quarter of 2024 that were retroactive to the start of the fund’s investment period and no such retroactive fees were earned for the three months ended June 30, 2025, (ii) a decrease in management fees earned from North America Fund XIII and Global Infrastructure Investors IV as a result of entering its post-investment period in the second quarter of 2025 and in the third quarter of 2024, respectively, and now paying fees based on invested capital rather than committed capital, and (iii) a lower level of management fees from Asian Fund III due to a step-down in the management fee rate and a decrease in invested capital subsequent to the second quarter of 2024.

Previous wording

Fee credits increased compared to the prior period as a result of a higher level of transaction fees in our Private Equity and Real Assets business lines in the current period. Fee credits owed to consolidated investment funds and other investment vehicles are eliminated upon consolidation under GAAP. However, because these amounts are owed to noncontrolling interests, upon consolidation under GAAP, KKR's allocated share of the net income from the consolidated investment funds and other investment vehicles is decreased by the amount of fee credits that are eliminated. Accordingly, net income (loss) attributable to KKR would be unchanged if such investment funds and other investment vehicles were not consolidated. Transaction and monitoring fees earned from our portfolio companies are not eliminated upon consolidation because those fees are earned from companies which are not consolidated. Furthermore, transaction fees earned in our capital markets business are not shared with fund investors. Accordingly, certain transaction fees are reflected in our revenues without a corresponding fee credit.

Current wording

Fee credits increased compared to the prior period as a result of a higher level of transaction fees in our Private Equity business line. Fee credits owed to consolidated investment funds and other investment vehicles are eliminated upon consolidation under GAAP. However, because these amounts are owed to noncontrolling interests, upon consolidation under GAAP, KKR's allocated share of the net income from the consolidated investment funds and other investment vehicles is decreased by the amount of fee credits that are eliminated. Accordingly, net income (loss) attributable to KKR would be unchanged if such investment funds and other investment vehicles were not consolidated. Transaction and monitoring fees earned from our portfolio companies are not eliminated upon consolidation because those fees are earned from companies which are not consolidated. Furthermore, transaction fees earned in our capital markets business are not shared with fund investors. Accordingly, certain transaction fees are reflected in our revenues without a corresponding fee credit.

Previous wording

Capital Allocation-Based Income (Loss) for the three months ended March 31, 2025 was positive primarily due to the net appreciation of the underlying investments at our unconsolidated carry earning investment funds, most notably Asian Fund IV, North America Fund XIII, and Global Infrastructure Fund IV. Capital Allocation-Based Income (Loss) for the three months ended March 31, 2024 was positive primarily due to the net appreciation of the underlying investments at our unconsolidated carry earning investment funds, most notably Asian Fund III, Americas Fund XII, and Global Infrastructure Investors IV.

Current wording

Capital Allocation-Based Income (Loss) for the three months ended June 30, 2025, was positive primarily due to the net appreciation of the underlying investments at our unconsolidated carry earning investment funds, most notably Asian Fund IV, Americas Fund XII, and Asian Fund III. Capital Allocation-Based Income (Loss) for the three months ended June 30, 2024, was positive primarily due to the net appreciation of the underlying investments at our unconsolidated carry earning investment funds, most notably Asian Fund IV, Asian Fund III, and North America Fund XIII.

Previous wording

For the three months ended March 31, 2025, net unrealized gains were driven primarily by (i) mark-to-market gains primarily relating to USI, Inc. (financial services sector), PO Söderberg & Partner Holding AB (financial services sector), and IVI-RMA Global, S.L. (health care sector) and (ii) the reversal of previously recognized unrealized losses relating to the realized losses described above. The unrealized gains were partially offset by (i) unrealized losses on certain foreign exchange forward contracts, (ii) unrealized losses on certain investments held in consolidated CLOs, and (iii) a mark-to-market loss relating to PetVet Care Centers, LLC (health care sector).

Current wording

For the three months ended June 30, 2025, net unrealized gains were driven by (i) mark-to-market gains primarily relating to Exact Holdings B.V. (technology sector), 1-800 Contacts Inc. (healthcare sector), and Arnott's Biscuit Limited (consumer products sector) and (ii) the reversal of previously recognized unrealized losses relating to the realization activity described above. The unrealized gains were partially offset by (i) unrealized losses on certain foreign exchange forward contracts, (ii) mark-to-market losses relating to PetVet Care Centers, LLC (health care sector) and Crescent Energy Company (NYSE: CRGY) (“Crescent”) and (iii) the reversal of previously recognized unrealized gains relating to the realization activity described above.

Previous wording

For the three months ended March 31, 2024, net unrealized gains were driven primarily by (i) mark-to-market gains primarily relating to PO Söderberg & Partner Holding AB, 1-800 Contacts, Inc. (health care sector) and foreign exchange forward contracts, and (ii) the reversal of previously recognized unrealized losses relating to the realization activity described above. These unrealized gains were partially offset by mark-to-market losses primarily relating to BridgeBio Pharma, Inc., Accell Group N.V. (consumer products sector), and certain real estate and credit consolidated funds.

Current wording

For the three months ended June 30, 2024, net unrealized gains were driven by (i) mark-to-market gains primarily relating to USI, Inc. (financial services sector), Barracuda Networks, Inc. (technology sector), and Arnott's Biscuit Limited. These unrealized gains were partially offset by (i) mark-to-market losses primarily relating to BridgeBio Pharma, Inc. and Accell Group N.V. (consumer products sector), and (ii) the reversal of previously recognized unrealized gains relating to the realization activity described above.

Previous wording

For a discussion of other factors that affected KKR's dividend income, see "—Analysis of Asset Management Segment Operating Results."

Current wording

Significant dividends from portfolio companies and consolidated funds are generally not recurring quarterly dividends, and while they may occur in the future, their size and frequency are variable. For a discussion of other factors that affected KKR's dividend income, see "—Analysis of Asset Management Segment Operating Results."

Previous wording

The decrease in interest income during the three months ended March 31, 2025 compared to the three months ended March 31, 2024 was primarily due to the impact of lower interest rates during the period on floating rate credit investments held in consolidated CLOs and certain of our consolidated private credit funds. The decrease was partially offset by the impact of closing CLOs that are consolidated subsequent to March 31, 2024. For a discussion of other factors that affected KKR's interest income, see "—Analysis of Asset Management Segment Operating Results."

Current wording

The decrease in interest income during the three months ended June 30, 2025, compared to the three months ended June 30, 2024, was primarily due to the impact of lower market interest rates during the current period on floating rate credit investments held in consolidated CLOs and certain of our consolidated private credit funds. The decrease was partially offset by the impact of closing CLOs that are consolidated subsequent to June 30, 2024. For a discussion of other factors that affected KKR's interest income, see "—Analysis of Asset Management Segment Operating Results."

Previous wording

The decrease in interest expense during the three months ended March 31, 2025 compared to the three months ended March 31, 2024 was primarily due to the impact of lower interest rates during the period on floating rate debt obligations held in consolidated CLOs and at certain consolidated funds and other investment vehicles. This decrease was partially offset by (i) the impact of closing CLOs that were consolidated subsequent to March 31, 2024 and (ii) an increase in the amount of borrowings outstanding at certain consolidated funds and other investment vehicles. For a discussion of other factors that affected KKR's interest expense, see "—Key Segment and Non-GAAP Performance Measures."

Current wording

The decrease in interest expense during the three months ended June 30, 2025, compared to the three months ended June 30, 2024, was primarily due to the impact of lower market interest rates during the current period on floating rate debt obligations held in consolidated CLOs and at certain consolidated funds and other investment vehicles. The decrease was partially offset by (i) the impact of closing CLOs that were consolidated subsequent to June 30, 2024, and (ii) an increase in the amount of borrowings outstanding. For a discussion of other factors that affected KKR's interest expense, see "—Key Segment and Non-GAAP Performance Measures."

Previous wording

The increase in compensation and benefits expense during the three months ended March 31, 2025, compared to the three months ended March 31, 2024, was primarily due to an increase in accrued discretionary cash compensation resulting from a higher level of asset management segment revenues in the current period.

Current wording

The increase in compensation and benefits expense during the three months ended June 30, 2025, compared to the three months ended June 30, 2024, was primarily due to a higher level of accrued carried interest compensation driven by a higher level of carried interest income earned in the current period and (ii) accrued discretionary cash compensation resulting from a higher level of asset management fee related segment revenues in the current period.

Previous wording

The increase in occupancy and related charges during the three months ended March 31, 2025, compared to the three months ended March 31, 2024, was primarily due to the commencement of new office leases.

Current wording

The increase in occupancy and related charges during the three months ended June 30, 2025, compared to the three months ended June 30, 2024, was primarily due to the commencement of new office leases subsequent to June 30, 2024.

Previous wording

Net premiums decreased for the three months ended March 31, 2025, as compared to the three months ended March 31, 2024, primarily due to a decrease in initial premiums assumed from fewer reinsurance transactions with life contingencies or morbidity risk during the three months ended March 31, 2025, as compared to the three months ended March 31, 2024. The initial premiums on assumed reinsurance were offset by a comparable decrease in policy reserves reported within net policy benefits and claims (as discussed below under “Expenses—Net policy benefits and claims”).

Current wording

Net premiums decreased for the three months ended June 30, 2025, as compared to the three months ended June 30, 2024, primarily due to a decrease in initial premiums assumed from fewer reinsurance transactions with life contingencies or morbidity risk during the three months ended June 30, 2025, as compared to the three months ended June 30, 2024. The initial premiums on assumed reinsurance were offset by a comparable decrease in policy reserves reported within net policy benefits and claims (as discussed below under “Expenses—Net policy benefits and claims”). Offsetting these decreases in part were new premiums earned on preneed insurance.

Previous wording

The decrease in the fair value of equity index options was primarily driven by the performance of the underlying indices. Global Atlantic purchases equity index options to hedge the market risk of embedded derivatives in indexed universal life and fixed-indexed annuity products (the change in which is accounted for in net policy benefits and claims). The majority of Global Atlantic's equity index options are based on the S&P 500 Index, which decreased during the three months ended March 31, 2025, and increased during the three months ended March 31, 2024.

Current wording

The increase in the fair value of equity index options was primarily driven by the performance of the underlying indices. Global Atlantic purchases equity index options to hedge the market risk of embedded derivatives in indexed universal life and fixed-indexed annuity products (the change in which is accounted for in net policy benefits and claims). The majority of Global Atlantic's equity index options are based on the S&P 500 Index, which had a comparatively larger increase during the three months ended June 30, 2025, than during the three months ended June 30, 2024.

Previous wording

The decrease in the fair value of foreign exchange and other derivative contracts was primarily driven by a combination of a decrease due to depreciation of the U.S. dollar (primarily against the euro) during the three months ended March 31, 2025 and an increase in the notional amount of foreign exchange derivatives.

Current wording

The decrease in the fair value of foreign exchange and other derivative contracts was primarily driven by a combination of foreign exchange losses due to the depreciation of the U.S. dollar (primarily against the euro) during the three months ended June 30, 2025 and an increase in the notional amount of foreign exchange derivatives outstanding.

Previous wording

The decrease in the fair value of embedded derivatives on funds withheld at interest payable for the three months ended March 31, 2025 was primarily driven by the change in fair value of the underlying investments in the funds withheld at interest payable portfolio, which is primarily comprised of fixed maturity securities (designated as trading for accounting purposes), mortgage and other loan receivables, and real asset investments. The underlying investments in the funds withheld at interest payable portfolio increased in value during the three months ended March 31, 2025, and decreased during the three months ended March 31, 2024, primarily due to a decrease in market interest rates during the three months ended March 31, 2025 as compared to an increase in market interest rates during the three months ended March 31, 2024.

Current wording

The decrease in the fair value of embedded derivatives on funds withheld at interest payable for the three months ended June 30, 2025 was primarily driven by the change in fair value of the underlying investments in the funds withheld at interest payable portfolio, which is primarily comprised of certain fixed maturity securities (designated as trading for accounting purposes), mortgage and other loan receivables, and real asset investments. The underlying investments in the funds withheld at interest payable portfolio increased in value during the three months ended June 30, 2025, and decreased during the three months ended June 30, 2024, primarily due to comparatively unchanged market interest rates during the three months ended June 30, 2025, as compared to an increase in market interest rates during the three months ended June 30, 2024.