Carlyle Group Inc.

1. Organization

The Carlyle Group Inc., together with its consolidated subsidiaries (“Carlyle” or the “Company”), is one of the

world’s largest global investment firms that deploys private capital across its business and conducts its operations

through three reportable segments: Global Private Equity, Global Credit, and Carlyle AlpInvest (see Note 14,

Segment Reporting). Carlyle typically serves as the general partner, investment manager, or collateral manager,

making day-to-day investment decisions concerning the assets of the products within these segments.

The Carlyle Group Inc. was formed in Delaware as a partnership on July 18, 2011. On January 1, 2020, the

Company completed its conversion from a Delaware limited partnership named The Carlyle Group L.P. into a

Delaware Corporation named The Carlyle Group Inc. (the conversion, together with such restructuring steps and

related transactions, the “Conversion”).

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying condensed consolidated financial statements are prepared in accordance with accounting

principles generally accepted in the United States (“U.S. GAAP”) and include the accounts of the Company and its

consolidated subsidiaries. In addition, certain Carlyle-affiliated funds, related co-investment entities, and certain

CLOs managed by the Company (collectively, the “Consolidated Funds”) have been consolidated in the

accompanying financial statements. Generally, the consolidation of the Consolidated Funds has a gross-up effect on

assets, liabilities and cash flows, but has no net effect on the net income attributable to the Company beyond the

capital contributed by the Company to the Consolidated Funds. The economic ownership interests of the other

investors in the Consolidated Funds are reflected as non-controlling interests in consolidated entities in the

accompanying condensed consolidated financial statements. All of the investments held by the Consolidated Funds

and notes issued by the consolidated CLOs are presented at their estimated fair values in the Company’s

condensed consolidated balance sheets. Interest and other income of the Consolidated Funds, interest expense

and other expenses of the Consolidated Funds, and net investment income (losses) of Consolidated Funds are

included in the Company’s condensed consolidated statements of operations.

Management has determined that the Company’s funds are investment companies under U.S. GAAP for the

purposes of financial reporting. U.S. GAAP for an investment company requires investments to be recorded at

estimated fair value and the unrealized gains and/or losses in an investment’s fair value are recognized on a current

basis in the statements of operations. Additionally, the funds do not consolidate their majority-owned and controlled

investments. In the preparation of these condensed consolidated financial statements, the Company has retained

the specialized accounting for the funds.

The accompanying condensed consolidated financial statements have been prepared in accordance with U.S.

GAAP for interim financial information. These statements, including notes, have not been audited, exclude some of

the disclosures required for annual financial statements, and should be read in conjunction with the audited

consolidated financial statements included in the Company’s Annual Report on Form 10-K for the year ended

December 31, 2025 filed with the U.S. Securities and Exchange Commission (“SEC”) on February 27, 2026. The

operating results presented for interim periods are not necessarily indicative of the results that may be expected for

any other interim period or for the entire year. In the opinion of management, the condensed consolidated financial

statements reflect all adjustments, consisting of normal recurring accruals, which are necessary for the fair

presentation of the financial condition and results of operations for the interim periods presented.

Principles of Consolidation

The Company consolidates all entities that it controls either through a majority voting interest or as the primary

beneficiary of variable interest entities (“VIEs”).

The Company evaluates (1) whether it holds a variable interest in an entity, (2) whether the entity is a VIE, and

(3) whether the Company’s involvement would make it the primary beneficiary. In evaluating whether the Company

holds a variable interest, fees (including management fees, incentive fees and performance allocations) that are

customary and commensurate with the level of services provided, and where the Company does not hold other

economic interests in the entity that would absorb more than an insignificant amount of the expected losses or

returns of the entity, are not considered variable interests. The Company considers all economic interests, including

indirect interests, to determine if a fee is considered a variable interest.

For those entities where the Company holds a variable interest, the Company determines whether each of

these entities qualifies as a VIE and, if so, whether or not the Company is the primary beneficiary. The assessment

of whether the entity is a VIE is generally performed qualitatively, which requires judgment. These judgments

include: (a) determining whether the equity investment at risk is sufficient to permit the entity to finance its activities

without additional subordinated financial support, (b) evaluating whether the equity holders, as a group, can make

decisions that have a significant effect on the economic performance of the entity, (c) determining whether two or

more parties’ equity interests should be aggregated, and (d) determining whether the equity investors have

proportionate voting rights to their obligations to absorb losses or rights to receive returns from an entity.

For entities that are determined to be VIEs, the Company consolidates those entities where it has concluded it

is the primary beneficiary. The primary beneficiary is defined as the variable interest holder with (a) the power to

direct the activities of a VIE that most significantly impact the entity’s economic performance and (b) the obligation

to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the

VIE. In evaluating whether the Company is the primary beneficiary, the Company evaluates its economic interests in

the entity held either directly or indirectly by the Company.

As of September 30, 2026, assets and liabilities of the consolidated VIEs reflected in the condensed

consolidated balance sheets were$15.0 billion and$12.4 billion, respectively. As of December 31, 2025, assets and

liabilities of the consolidated VIEs reflected in the consolidated balance sheets were$14.0 billion and$11.7 billion,

respectively. Except to the extent of the consolidated assets of the VIEs, the holders of the consolidated VIEs’

liabilities generally do not have recourse to the Company.

The Company’s Consolidated Funds are primarily CLOs, which are VIEs that issue loans payable that are

backed by diversified collateral asset portfolios consisting primarily of loans or structured debt. In exchange for

managing the collateral for the CLOs, the Company earns investment management fees, including in some cases

subordinated management fees and contingent incentive fees. In cases where the Company consolidates the CLOs

(primarily because of a retained interest that is significant to the CLO), those management fees and contingent

incentive fees have been eliminated as intercompany transactions. As of September 30, 2026, the Company held

$534.3 million of investments in these CLOs which represents its maximum risk of loss. The Company’s

investments in these CLOs are generally subordinated to other interests in the entities and entitle the Company to

receive a pro rata portion of the residual cash flows, if any, from the entities. Investors in the CLOs have no

recourse against the Company for any losses sustained in the CLO structure. The Company’s Consolidated Funds

also include certain investment funds in the Global Private Equity segment that are accounted for as consolidated

VIEs due to the Company providing financing to bridge investment purchases. As of September 30, 2026, the

Company held$980.0 million of notes receivable and investments related to these investment funds which

represents its maximum risk of loss. The Company’s Consolidated Funds also include certain funds in the Global

Credit and Carlyle AlpInvest segments that are accounted for as consolidated VIEs due to the Company having

either a significant direct interest in these funds or significant indirect interest via the Company’s investment in

Fortitude (see Note 4, Investments).

Entities that do not qualify as VIEs are generally assessed for consolidation as voting interest entities. Under

the voting interest entity model, the Company consolidates those entities it controls through a majority voting

interest.

All significant inter-entity transactions and balances of entities consolidated have been eliminated.

Investments in Unconsolidated Variable Interest Entities

The Company holds variable interests in certain VIEs that are not consolidated because the Company is not

the primary beneficiary, including its investments in certain credit vehicles and certain Carlyle AlpInvest vehicles, as

well as its strategic investment in NGP Management Company, L.L.C. (“NGP Management” and, together with its

affiliates, “NGP”). Refer to Note 4, Investments, for information on the strategic investment in NGP. The Company’s

involvement with such entities is in the form of direct or indirect equity interests and fee arrangements. The

maximum exposure to loss represents the loss of assets recognized by the Company relating to its variable

interests in these unconsolidated entities.

The assets recognized in the Company’s condensed consolidated balance sheets related to the Company’s

variable interests in these non-consolidated VIEs were as follows:

These amounts represent the Company’s maximum exposure to loss related to the unconsolidated VIEs as of

September 30, 2026 and December 31, 2025.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make

assumptions and estimates that affect the reported amounts of assets and liabilities and disclosure of contingent

assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of

revenues and expenses during the reporting period. Management’s estimates are based on historical experiences

and other factors, including expectations of future events that management believes to be reasonable under the

circumstances. It also requires management to exercise judgment in the process of applying the Company’s

accounting policies. Assumptions and estimates regarding the valuation of investments and their resulting impact on

performance allocations and incentive fees involve a higher degree of judgment and complexity and these

assumptions and estimates may be significant to the condensed consolidated financial statements and the resulting

impact on performance allocations and incentive fees. Actual results could differ from these estimates and such

differences could be material.

Revenue Recognition

The Company recognizes revenue in accordance with Accounting Standards Codification (“ASC”) 606,

Revenue from Contracts with Customers. Revenue is recognized when the Company transfers promised goods or

services to customers in an amount that reflects the consideration to which the Company expects to be entitled in

exchange for those goods or services. ASC 606 includes a five-step framework that requires an entity to: (i) identify

the contract(s) with a customer, which includes assessing the collectability of the consideration to which it will be

entitled in exchange for the goods or services transferred to the customer, (ii) identify the performance obligations in

the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in

the contract, and (v) recognize revenue when the entity satisfies a performance obligation.

The Company accounts for performance allocations that represent a performance-based capital allocation

from fund limited partners to the Company (commonly known as “carried interest”) as earnings from financial assets

within the scope of ASC 323, Investments—Equity Method and Joint Ventures, and therefore are not in the scope of

ASC 606. In accordance with ASC 323, the Company records equity method income (losses) as a component of

investment income based on the change in its proportionate claim on net assets of the investment fund, including

performance allocations, assuming the investment fund was liquidated as of each reporting date pursuant to each

fund’s governing agreements. See Note 4, Investments, for additional information on the components of

investments and investment income. Performance fees that do not meet the definition of performance-based capital

allocations are in the scope of ASC 606 and are included in incentive fees in the condensed consolidated

statements of operations. The calculation of unrealized performance revenues utilizes investment valuations of the

funds’ underlying investments, which are derived using the policies, methodologies and templates prepared by the

Company’s valuation group, as described in Note 3, Fair Value Measurement.

While the determination of who is the customer in a contractual arrangement will be made on a contract-by-

contract basis, the customer will generally be the investment fund for the Company’s significant management and

advisory contracts. The customer determination impacts the Company’s analysis of the accounting for contract

costs.

Fund Management Fees

The Company provides management services to funds in which it holds a general partner interest or to funds

or certain portfolio companies with which it has an investment advisory or investment management agreement. The

Company considers the performance obligations in its contracts with its funds to be the promise to provide (or to

arrange for third parties to provide) investment management services related to the management, policies and

operations of the funds.

As it relates to the Company’s performance obligation to provide investment management services, the

Company typically satisfies this performance obligation over time as the services are rendered, as the funds

simultaneously receive and consume the benefits provided as the Company performs the service. The transaction

price is the amount of consideration to which the Company expects to be entitled in exchange for transferring the

promised services to the funds. Management fees earned from each investment management contract over the

contract life represent variable consideration because the consideration the Company is entitled to varies based on

fluctuations in the basis for the management fee, for example fund net asset value (“NAV”) or assets under

management (“AUM”). Given that the management fee basis is susceptible to market factors outside of the

Company’s influence, management fees are constrained and, therefore, estimates of future period management

fees are generally not included in the transaction price. Revenue recognized for the investment management

services provided is generally the amount determined at the end of the period because that is when the uncertainty

for that period is resolved.

Management fees may be charged in advance or arrears, and at a monthly, quarterly, or semi-annual cadence

pursuant to the terms of the investment management agreement. The range of management fee rates and the base

on which they are earned vary based on the product’s strategy, expected term, and other factors, but generally

encompass the following:

•For closed-end carry funds in the Global Private Equity and Global Credit segments:

◦During the fund’s commitment period, generally 1.0% to 2.0% of limited partners’ capital

commitments in the case of Global Private Equity and invested capital in the case of Global

Credit, and

◦Following the expiration or termination of the investment period, generally 0.5% to 2.0% of the

lower of cost or fair value of invested capital.

•For carry funds and other fund vehicles in the Carlyle AlpInvest segment:

◦During the fund’s commitment period, generally 0.25% to 1.5% of the vehicle’s capital

commitments, and

◦Following the expiration of the commitment fee period, generally 0.25% to 1.5% on (i) the net

invested capital, (ii) the lower of cost or net asset value of the capital invested, or (iii) the net

asset value for unrealized investments.

•For CLOs and other structured products in the Global Credit segment,0.4% to 0.5% based on the total

par amount of assets or the aggregate principal amount of the notes in the CLO.

•For certain of the Company’s perpetual capital strategies and separately managed accounts in the Global

Credit segment,0.10% to 0.75% based on invested capital or the fair value of the underlying assets.

•For certain cross platform products as well as the Company’s business development companies in the

Global Credit segment,1.0% to 1.5% of gross assets, excluding cash and cash equivalents, or net asset

value.

•For the Company’s retail-oriented perpetual capital products, including CTAC, ETAC, CPEP, CAPM, and

CAPS funds, generally 1.0% to 1.25% of net asset value.

The Company also provides transaction advisory and portfolio advisory services to the portfolio companies,

and where covered by separate contractual agreements, recognizes fees for these services when the performance

obligation has been satisfied and collection is reasonably assured. The Company is generally required to offset its

fund management fees earned from the funds that have invested in the portfolio companies to which the service has

been provided by a percentage of the transaction and advisory fees allocable to those funds. This amount is

referred to as the “rebate offset,” and is generally 100%. Transaction and advisory fees allocable to funds that do

not pay fund management fees do not have a rebate offset. The Company also recognizes underwriting fees from

the Company’s loan syndication and capital markets business, Carlyle Global Capital Markets. Fund management

fees include transaction and portfolio advisory fees, as well as capital markets fees, of$27.7 million and$21.1

million for thethree months ended September 30, 2026 and 2025, respectively, and$185.5 million and$143.6

million for thenine months ended September 30, 2026 and 2025, respectively, net of rebate offsets as defined in the

respective fund limited partnership agreements.

Fund management fees exclude the reimbursement of any partnership expenses paid by the Company on

behalf of the Carlyle funds pursuant to the limited partnership agreements, including amounts related to the pursuit

of actual, proposed, or unconsummated investments, professional fees, expenses associated with the acquisition,

holding and disposition of investments, and other fund administrative expenses. For the professional fees that the

Company arranges for the investment funds, the Company concluded that the nature of its promise is to arrange for

the services to be provided and it does not control the services provided by third parties before they are transferred

to the customer. Therefore, the Company concluded it is acting in the capacity of an agent. Accordingly, the

reimbursement for these professional fees paid on behalf of the investment funds is presented on a net basis in

general, administrative and other expenses in the condensed consolidated statements of operations.

The Company also incurs certain costs, primarily employee travel and entertainment costs, employee

compensation and systems costs, for which it receives reimbursement from the investment funds in connection with

its performance obligation to provide investment and management services. For reimbursable travel, compensation

and systems costs, the Company concluded it controls the services provided by its employees and the resources

used to develop applicable systems before they are transferred to the customer and therefore is a principal.

Accordingly, the reimbursement for these costs incurred by the Company to manage the fund limited partnerships

are presented on a gross basis in interest and other income in the condensed consolidated statements of

operations and the expense in general, administrative and other expenses or cash-based compensation and

benefits expenses in the condensed consolidated statements of operations.

Incentive Fees

The Company is also entitled to receive performance-based incentive fees when the return on assets under

management exceeds certain benchmark returns or other performance targets. In such arrangements, the

Company is entitled to an incentive fee generally between 10.0% and 17.5% of either pre-incentive investment

income or net profits, in most instances subject to a quarterly hurdle rate and catch-up, payable quarterly. Incentive

fees are recognized when the performance benchmark has been achieved. Incentive fees are variable

consideration because they are contingent upon the investment vehicle achieving stipulated investment return

hurdles. Investment returns are highly susceptible to market factors outside of the Company’s influence.

Accordingly, incentive fees are constrained until all uncertainty is resolved. Estimates of future period incentive fees

are generally not included in the transaction price because these estimates are constrained. The transaction price

for incentive fees is generally the amount determined at the end of each accounting period to which they relate

because that is when the uncertainty for that period is resolved, as these fees are not subject to clawback.

Investment Income (Loss), including Performance Allocations

Investment income (loss) represents the unrealized and realized gains and losses resulting from the

Company’s equity method investments, including any associated general partner performance allocations, and

other principal investments, including CLOs.

General partner performance allocations consist of the allocation of profits from certain of the funds to which

the Company is entitled (commonly known as carried interest).

For closed-end carry funds in the Global Private Equity and Global Credit segments, the Company is generally

entitled to a 20% allocation (or approximately 2% to 12.5% for most of the Carlyle AlpInvest segment carry fund

vehicles) of the net realized income or gain as a carried interest after returning the invested capital, the allocation of

preferred returns of generally 7% to 9% and return of certain fund costs (generally subject to catch-up provisions as

set forth in the fund limited partnership agreement). These terms may vary on longer-dated funds, certain credit

funds, and external co-investment vehicles. Carried interest is recognized upon appreciation of the funds’

investment values above certain return hurdles set forth in each respective partnership agreement. The Company

recognizes revenues attributable to performance allocations based upon the amount that would be due pursuant to

the fund partnership agreement at each period end as if the funds were terminated at that date. Accordingly, the

amount recognized as investment income for performance allocations reflects the Company’s share of the gains

and losses of the associated funds’ underlying investments measured at their then-current fair values relative to the

fair values as of the end of the prior period. Because of the inherent uncertainty, these estimated values may differ

significantly from the values that would have been used had a ready market for the investments existed, and it is

reasonably possible that the difference could be material.

Carried interest is ultimately realized when: (i) an underlying investment is profitably disposed of, (ii) certain

costs borne by the limited partner investors have been reimbursed, (iii) the fund’s cumulative returns are in excess

of the preferred return, and (iv) the Company has decided to collect carry rather than return additional capital to

limited partner investors. Realized carried interest may be required to be returned by the Company in future periods

if the fund’s investment values decline below certain levels. When the fair value of a fund’s investments remains

constant or falls below certain return hurdles, previously recognized performance allocations are reversed. In all

cases, each fund is considered separately in this regard, and for a given fund, performance allocations can never be

negative over the life of a fund. If upon a hypothetical liquidation of a fund’s investments at their then-current fair

values, previously recognized and distributed carried interest would be required to be returned, a liability is

established for the potential giveback obligation. See Note 7, Commitments and Contingencies, for additional

information on the Company’s giveback obligations.

Principal investment income (loss) is realized when the Company redeems all or a portion of its investment or

when the Company receives or is due cash income, such as dividends or distributions. Unrealized principal

investment income (loss) results from the Company’s proportionate share of the investee’s unrealized earnings,

including changes in the fair value of the underlying investment, as well as the reversal of unrealized gain (loss) at

the time an investment is realized. As it relates to the Company’s investments in NGP (see Note 4, Investments),

principal investment income includes the related amortization of the basis difference between the Company’s

carrying value of its investment and the Company’s share of underlying net assets of the investee, as well as the

compensation expense associated with compensatory arrangements provided by the Company to employees of its

equity method investee, and impairment charges.

Interest Income

Interest income is recognized when earned. For debt securities representing non-investment grade beneficial

interests in securitizations, the effective yield is determined based on the estimated cash flows of the security.

Changes in the effective yield of these securities due to changes in estimated cash flows are recognized on a

prospective basis as adjustments to interest income in future periods. Interest income earned by the Company is

included in interest and other income in the accompanying condensed consolidated statements of operations.

Interest income of the Consolidated Funds is included in interest and other income of Consolidated Funds in the

accompanying condensed consolidated statements of operations. See Note 4, Investments, for additional

information on investments of Consolidated Funds.

Credit Losses

The Company measures all expected credit losses for financial assets held at the reporting date in

accordance with ASC 326, Financial Instruments—Credit Losses, based on historical experience, current

conditions, and reasonable and supportable forecasts. The Company assesses the collection risk characteristics of

the outstanding amounts in its due from affiliates balance into the following pools of receivables:

•Reimbursable fund expenses receivables,

•Management fee receivables,

•Incentive fee receivables,

•Transaction fee receivables,

•Portfolio fee receivables, and

•Notes receivable.

The Company generally utilizes either historical credit loss information or discounted cash flows to calculate

expected credit losses for each pool. The Company’s receivables are predominantly with its investment funds,

which have low risk of credit loss based on the Company’s historical experience. Historical credit loss data may be

adjusted for current conditions and reasonable and supportable forecasts, including the Company’s expectation of

near-term realization based on the liquidity of the affiliated investment funds.

Compensation and Benefits

Cash-Based Compensation and Benefits – Cash-based compensation and benefits includes salaries, bonuses

(discretionary awards and guaranteed amounts), performance payment arrangements, and benefits paid and

payable to Carlyle employees. Bonuses are accrued over the service period to which they relate.

Equity-Based Compensation – Compensation expense relating to the issuance of equity-based awards is

measured at fair value on the grant date. The compensation expense for awards that vest over a future service

period is recognized over the relevant service period on a straight-line basis. The compensation expense for awards

that do not require future service is recognized immediately. Cash settled equity-based awards are classified as

liabilities and are re-measured at the end of each reporting period. The compensation expense for awards that

contain performance conditions is recognized when it is probable that the performance conditions will be achieved.

The compensation expense for awards that contain market conditions is based on a grant-date fair value that

factors in the probability that the market conditions will be achieved and is recognized over the requisite service

period on a straight-line basis.

Certain equity-based awards contain dividend-equivalent rights, which are subject to the same terms and

conditions, including with respect to vesting and settlement, that apply to the related award. Dividend-equivalents

are accounted for as a reclassification from retained earnings to additional paid-in capital at the time dividends are

declared and do not result in incremental compensation expense.

Equity-based awards issued to non-employees are generally recognized as general, administrative and other

expenses, except to the extent they are recognized as part of the Company’s equity method earnings because they

are issued to employees of equity method investees.

The Company recognizes equity-based award forfeitures in the period they occur as a reversal of previously

recognized compensation expense for awards that vest based on service and/or performance conditions. The

reduction in compensation expense is determined based on the specific awards forfeited during that period.

Furthermore, the Company recognizes all excess tax benefits and deficiencies as income tax benefit or expense in

the condensed consolidated statements of operations. For awards with a market condition (e.g., achievement of

certain stock price hurdles) that are forfeited due to the market condition not being achieved, the related equity-

based compensation expense is not reversed.

Performance Allocations and Incentive Fee Related Compensation – A portion of the performance allocations

and incentive fees and certain other interests earned is due to employees and advisors of the Company. These

amounts are accounted for as profit sharing interests in compensation expense in a systematic and rational manner

in conjunction with the recognition of the related performance allocations and incentive fee revenue and, until paid,

are recognized as a component of the accrued compensation and benefits liability. The liability is measured

assuming the hypothetical liquidation of the associated funds’ underlying investments as of the measurement date.

Accordingly, upon a reversal of performance allocations or incentive fee revenue, the related compensation

expense, if any, is also reversed. As any vesting requirement is accelerated upon realization, the service period is

not considered substantive when recording the liability based on the hypothetical liquidation value. As of

September 30, 2026 and December 31, 2025, the Company recorded a liability of$4.0 billion and$5.1 billion,

respectively, related to the portion of accrued performance allocations and incentive fees due to employees and

advisors, which was included in accrued compensation and benefits in the accompanying condensed consolidated

balance sheets.

Income Taxes

The Company is a corporation for U.S. federal income tax purposes and is subject to U.S. federal, state, local,

and foreign income taxes. The Company is subject to periodic audit by U.S. federal, state, local, and foreign taxing

authorities. The interim provision for income taxes is generally calculated using an estimated annual effective tax

rate applied to year-to-date ordinary income in accordance with ASC 740, Income Taxes.

Non-controlling Interests

Non-controlling interests in consolidated entities represent the component of equity in consolidated entities

held by third-party investors. These interests are adjusted for general partner allocations which occur during the

reporting period. Any change in ownership of a subsidiary while the controlling financial interest is retained is

accounted for as an equity transaction between the controlling and non-controlling interests. Transaction costs

incurred in connection with such changes in ownership of a subsidiary are recorded as a direct charge to equity.

Earnings Per Common Share

The Company computes earnings per common share in accordance with ASC 260, Earnings Per Share. Basic

earnings per common share is calculated by dividing net income (loss) attributable to the common shares of the

Company by the weighted-average number of common shares outstanding for the period. Diluted earnings per

common share reflects the assumed conversion of all dilutive securities. The Company applies the treasury stock

method to determine the dilutive weighted-average common shares outstanding for certain equity-based

compensation awards. For certain equity-based compensation awards that contain performance or market

conditions, the number of contingently issuable common shares is included in diluted earnings per common share

based on the number of common shares, if any, that would be issuable under the terms of the awards if the end of

the reporting period were the end of the contingency period, if the result is dilutive.

Fair Value of Financial Instruments

The underlying entities that the Company manages and invests in (and in certain cases, consolidates) are

primarily investment companies which account for their investments at estimated fair value.

The fair value measurement accounting guidance under ASC 820, Fair Value Measurement, establishes a

hierarchical disclosure framework which ranks the observability of market price inputs used in measuring financial

instruments at fair value. The observability of inputs is impacted by a number of factors, including the type of

financial instrument, the characteristics specific to the financial instrument and the state of the marketplace,

including the existence and transparency of transactions between market participants. Financial instruments with

readily available quoted prices, or for which fair value can be measured from quoted prices in active markets, will

generally have a higher degree of market price observability and a lesser degree of judgment applied in determining

fair value.

Financial instruments measured and reported at fair value are classified and disclosed based on the

observability of inputs used in the determination of fair values, as follows:

Level I– inputs to the valuation methodology are quoted prices available in active markets for identical

instruments as of the reporting date. The type of financial instruments in this category include

unrestricted securities, such as equities and derivatives, listed in active markets. The Company does

not adjust the quoted price for these instruments, even in situations where the Company holds a large

position and a sale could reasonably impact the quoted price.

Level II – inputs to the valuation methodology are other than quoted prices in active markets, which are

either directly or indirectly observable as of the reporting date. The types of financial instruments in this

category include less liquid and restricted securities listed in active markets, securities traded in other

than active markets, government and agency securities, and certain over-the-counter derivatives where

the fair value is based on observable inputs.

Level III – inputs to the valuation methodology are unobservable and significant to overall fair value

measurement. The inputs into the determination of fair value require significant management judgment

or estimation. The types of financial instruments in this category include investments in privately-held

entities, non-investment grade residual interests in securitizations, collateralized loan obligations, and

certain over-the-counter derivatives where the fair value is based on unobservable inputs.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy.

In such cases, the determination of which category within the fair value hierarchy is appropriate for any given

financial instrument is based on the lowest level of input that is significant to the fair value measurement. The

Company’s assessment of the significance of a particular input to the fair value measurement in its entirety requires

judgment and considers factors specific to the financial instrument.

In certain cases, debt and equity securities (including corporate treasury investments) are valued on the basis

of prices from an orderly transaction between market participants provided by reputable dealers or pricing services.

In determining the value of a particular investment, pricing services may use certain information with respect to

transactions in such investments, quotations from dealers, pricing matrices, market transactions in comparable

investments, and various relationships between investments.

In the absence of observable market prices, the Company values its investments and its funds’ investments

using valuation methodologies applied on a consistent basis. For some investments little market activity may exist.

Management’s determination of fair value is then based on the best information available in the circumstances and

may incorporate management’s own assumptions and involve a significant degree of judgment, taking into

consideration a combination of internal and external factors, including the appropriate risk adjustments for non-

performance and liquidity risks. Investments for which market prices are not observable include private investments

in the equity and debt of operating companies and real assets, CLO investments and CLO loans payable, and fund

investments. The valuation technique for each of these investmentsis described below:

Investments in Operating Companies and Real Assets – The fair values of private investments in operating

companies and real assets are generally determined by reference to the income approach (including the

discounted cash flow method and the income capitalization method) and the market approach (including the

comparable publicly traded company method and the comparable transaction method). Valuations under

these approaches are typically derived by reference to investment-specific inputs (such as projected cash

flows, earnings before interest, taxes, depreciation and amortization (“EBITDA”), and net operating income)

combined with market-based inputs (such as discount rates, EBITDA multiples and capitalization rates). In

many cases, the investment-specific inputs are unaudited at the time received. Management may also

adjust the market-based inputs to account for differences between the subject investment and the

companies, assets or investments used to derive the market-based inputs. Adjustments to observable

valuation measures are frequently made upon the initial investment to calibrate the initial investment

valuation to industry observable inputs. Such adjustments are made to align the investment to observable

industry inputs for differences in size, profitability, projected growth rates, geography, capital structure, and

other factors as applicable. The adjustments are then reviewed with each subsequent valuation to assess

how the investment has evolved relative to the observable inputs. Additionally, the investment may be

subject to certain specific risks and/or development milestones which are also taken into account in the

valuation assessment. Option pricing models and similar tools may also be considered but do not currently

drive a significant portion of operating company or real asset valuations and are used primarily to value

warrants, derivatives, certain restrictions, and other atypical investment instruments.

Credit-Oriented Investments –Where available, the fair values of credit-oriented investments (including

corporate treasury investments) are generally determined on the basis of prices between market

participants provided by reputable dealers or pricing services. In determining the value of a particular

investment, pricing services may use certain information with respect to transactions in such investments,

quotations from dealers, pricing matrices, market transactions in comparable investments, and various

relationships between investments. Specifically, for investments in distressed debt and corporate loans and

bonds, the fair values are generally determined by valuations of comparable investments. Where such

pricing is not available or reliable, the Company may utilize other valuation techniques, including the

discounted cash flow method.

CLO Investments and CLO Loans Payable – The Company measures the financial liabilities of its

consolidated CLOs based on the fair value of the financial assets of its consolidated CLOs, as the Company

believes the fair value of the financial assets are more observable. The fair values of the CLO loan and

bond assets are primarily based on quotations from reputable dealers or relevant pricing services. In

situations where valuation quotations are unavailable, the assets are valued based on similar securities,

market index changes, and other factors. The Company performs certain procedures to ensure the reliability

of the quotations from pricing services for its CLO assets and CLO structured asset positions, which

generally includes corroborating prices with a discounted cash flow analysis. Generally, the loan and bond

assets of the CLOs are not publicly traded and are classified as Level III. The fair values of the CLO

structured asset positions are determined based on both discounted cash flow analyses and third-party

quotes. Those analyses consider the position size, liquidity, current financial condition of the CLOs, the

third-party financing environment, reinvestment rates, recovery lags, discount rates, and default forecasts

and are compared to broker quotations from market makers and third-party dealers.

The Company measures the CLO loan payables held by third-party beneficial interest holders on the basis

of the fair value of the financial assets of the CLO and the beneficial interests held by the Company. The

Company continues to measure the CLO loans payable that it holds at fair value based on relevant pricing

services or discounted cash flow analyses, as described above.

Fund Investments– The Company’s primary and secondary investments in external funds are generally

valued as its proportionate share of the most recent net asset value provided by the third-party general

partners of the underlying fund partnerships, adjusted for subsequent cash flows received from or

distributed to the underlying fund partnerships. The Company also adjusts for any changes in the market

prices of public securities held by the underlying fund partnerships and may also apply a market adjustment

to reflect the estimated change in the fair value of the underlying fund partnerships’ non-public investments

from the date of the most recent net asset value provided by the third-party general partners.

Investment professionals with responsibility for the underlying investments are responsible for preparing the

investment valuations pursuant to the policies, methodologies, and templates prepared by the Company’s valuation

group, which is a team made up of dedicated valuation professionals reporting to the Company’s Chief Accounting

Officer. The valuation group is responsible for maintaining the Company’s valuation policy and related guidance,

templates, and systems that are designed to be consistent with the guidance found in ASC 820. These valuations,

inputs, and preliminary conclusions are reviewed by the fund management teams. The valuations are then reviewed

and approved by the respective fund valuation subcommittees, which include the respective fund head(s), segment

head, Chief Financial Officer, and Chief Accounting Officer, as well as members of the valuation group. The

valuation group compiles the aggregate results and significant matters and presents them for review and approval

by the global valuation committee, which includes, among others, the Company’s Chief Financial Officer, Chief

Accounting Officer, and the business segment heads, and is observed by the Chief Compliance Officer, the Chief

Audit Executive, the Chief Risk Officer, the Company’s Audit Committee, and others. Additionally, each quarter a

sample of valuations are reviewed by external valuation firms. Valuations of the funds’ investments are used in the

calculation of accrued performance allocations.

Investments, at Fair Value

Investments include (i) the Company’s ownership interests (typically general partner interests) in the Funds,

including the Company’s investment in Fortitude held through Carlyle FRL (which are accounted for as equity

method investments), (ii) the Company’s investment in NGP (which is accounted for as an equity method

investment), (iii) the investments held by the Consolidated Funds (which are presented at fair value in the

Company’s condensed consolidated financial statements), and (iv) certain credit-oriented investments, including

investments in the CLOs and the common shares of Carlyle Secured Lending, Inc. (“CGBD,” see Note 4,

Investments, to this Quarterly Report on Form 10-Q and Note 9, Related Party Transactions, to our Annual Report

on Form 10-K for the year ended December 31, 2025 for more information), which are accounted for as trading

securities.

Upon the sale of a security or other investment, the realized net gain or loss is computed on a weighted

average cost basis, with the exception of the investments held by the CLOs, which compute the realized net gain or

loss on a first in, first out basis. Securities transactions are recorded on a trade date basis.

Equity Method Investments

The Company accounts for all investments in which it has or is otherwise presumed to have significant

influence, including investments in unconsolidated investment funds and the Company’s investment in NGP, using

the equity method of accounting. The carrying value of equity method investments is determined based on amounts

invested by the Company, adjusted for the equity in earnings or losses of the investee (including performance

allocations) allocated based on the respective partnership agreement, less distributions received. The Company

evaluates its equity method investments for impairment whenever events or changes in circumstances indicate that

the carrying amounts of such investments may not be recoverable.

Cash and Cash Equivalents

Cash and cash equivalents include cash held at banks and cash held for distributions, including investments

with original maturities of less than three months when purchased. The Company is subject to credit risk should a

financial institution be unable to fulfill its obligations and if balances held at a financial institution exceed insured

limits.

Cash and Cash Equivalents Held at Consolidated Funds

Cash and cash equivalents held at Consolidated Funds consists of cash and cash equivalents held by the

Consolidated Funds, which, although not legally restricted, is not available to fund the general liquidity needs of the

Company.

Restricted Cash

Restricted cash primarily represents cash that is subject to legal, regulatory, or contractual restrictions on its

withdrawal or use for general operating purposes, as well as certain amounts held on behalf of Carlyle funds. As of

September 30, 2026 and December 31, 2025, the Company held restricted cash of$0.8 million and$3.4 million,

respectively, which are included in Deposits and other in the condensed consolidated balance sheets.

Corporate Treasury Investments

Corporate treasury investments represent investments in U.S. Treasury and government agency obligations,

commercial paper, certificates of deposit, other investment grade securities and other investments with original

maturities of greater than three months when purchased. These investments are accounted for as trading securities

in which changes in the fair value of each investment are recorded through investment income (loss). Any interest

earned on debt investments is recorded through interest and other income.

Derivative Instruments

The Company uses derivative instruments primarily to reduce its exposure to changes in foreign currency

exchange rates. Derivative instruments are recognized at fair value in the condensed consolidated balance sheets

with changes in fair value recognized in the condensed consolidated statements of operations for all derivatives not

designated as hedging instruments.

Securities Sold Under Agreements to Repurchase

As it relates to certain European CLOs sponsored by the Company, securities sold under agreements to

repurchase (“Repurchase Agreements”) are accounted for as collateralized financing transactions. The Company

provides securities to counterparties to collateralize amounts borrowed under Repurchase Agreements on terms

that permit the counterparties to repledge or resell the securities to others. As of September 30, 2026,$358.6 million

of securities were transferred to counterparties under Repurchase Agreements and are included within investments

in the condensed consolidated balance sheets. Cash received under Repurchase Agreements is recognized as a

liability within debt obligations in the condensed consolidated balance sheets. See Note 5, Borrowings, for additional

information.

Fixed Assets

Fixed assets consist of furniture, fixtures and equipment, leasehold improvements, computer hardware and

software, and fractional shares in corporate aircraft, and are stated at cost, less accumulated depreciation and

amortization. Depreciation is recognized on a straight-line method over the assets’ estimated useful lives, which for

leasehold improvements are the lesser of the lease terms or the life of the asset, andthree toseven years for other

fixed assets. Fixed assets are reviewed for impairment whenever events or changes in circumstances indicate that

the carrying amount of an asset may not be recoverable.

Leases

The Company accounts for its leases in accordance with ASC 842, Leases, and recognizes a lease liability

and right-of-use (“ROU”) asset in the condensed consolidated balance sheets for contracts that it determines are

leases or contain a lease. The Company’s leases primarily consist of operating leases for office space in various

countries around the world. The Company also has operating leases for office equipment and vehicles, which are

not significant. The Company does not separate non-lease components from lease components for its office space

and equipment operating leases and instead accounts for each separate lease component and its associated non-

lease component as a single lease component. ROU assets represent the Company’s right to use an underlying

asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising

from the leases. The Company’s ROU assets and lease liabilities are recognized at lease commencement based on

the present value of lease payments over the lease term. Lease ROU assets include initial direct costs incurred by

the Company and are presented net of deferred rent and lease incentives. Absent an implicit interest rate in the

lease, the Company uses its incremental borrowing rate, adjusted for the effects of collateralization, based on the

information available at commencement in determining the present value of lease payments. The Company’s lease

terms may include options to extend or terminate the lease when it is reasonably certain that the Company will

exercise those options. Lease expense for lease payments is recognized on a straight-line basis over the lease

term. Lease ROU assets are reviewed for impairment whenever events or changes in circumstances indicate that

the carrying amount of the asset may not be recoverable.

The Company does not recognize a lease liability or ROU asset on the balance sheet for short-term leases.

Instead, the Company recognizes short-term lease payments as an expense on a straight-line basis over the lease

term. A short-term lease is defined as a lease that, at the commencement date, has a lease term of 12 months or

less and does not include an option to purchase the underlying asset that the lessee is reasonably certain to

exercise. When determining whether a lease qualifies as a short-term lease, the Company evaluates the lease term

and the purchase option in the same manner as all other leases.

In 2026, the Company entered into an operating lease agreement for office space in New York City, which has

a term of 10 years and is expected to commence during 2028. The total contractual minimum lease payment over

the term of the lease is approximately$255 million. The related ROU asset and operating lease liability will be

recorded on the lease commencement date and are not reflected on the Company’s condensed consolidated

balance sheets as of September 30, 2026.

Intangible Assets and Goodwill

The Company’s intangible assets consist of acquired contractual rights to earn future fee income, including

management and advisory fees, customer relationships, and acquired trademarks. Finite-lived intangible assets are

amortized over their estimated useful lives, which range from four toeight years, and are reviewed for impairment

whenever events or changes in circumstances indicate that the carrying amount of the asset may not be

recoverable. Intangible asset amortization expense was$32.8 million for both thethree months ended September

30, 2026 and 2025, and$98.4 million and$98.2 million for thenine months ended September 30, 2026 and 2025,

respectively, and is included in general, administrative, and other expenses in the condensed consolidated

statements of operations. Certain intangible assets are held by entities of which the functional currency is not the

U.S. dollar. Any corresponding currency translation is recorded in accumulated other comprehensive income (loss).

Goodwill represents the excess of cost over the identifiable net assets of businesses acquired and is recorded

in the functional currency of the acquired entity. Goodwill is recognized as an asset and is reviewed for impairment

annually as of October 1 and between annual tests when events and circumstances indicate that impairment may

have occurred.

The Company recordedno impairment losses of intangible assets or goodwill during thethree and nine

months ended September 30, 2026 and 2025.

Deferred Revenue

Deferred revenue represents management fees and other revenue received prior to the balance sheet date,

which has not yet been earned. Deferred revenue also includes transaction and portfolio advisory fees received by

the Company that are required to offset fund management fees pursuant to the related fund agreements.

Accumulated Other Comprehensive Income (Loss)

The Company’s accumulated other comprehensive income (loss)comprises foreign currency translation

adjustments and gains and losses on defined benefit plans sponsored by AlpInvest. The components of

accumulated other comprehensive income (loss) as of September 30, 2026 and December 31, 2025 were as

follows:

Foreign Currency Translation

Non-U.S. dollar denominated assets and liabilities are remeasured at period-end rates of exchange, and the

condensed consolidated statements of operations are remeasured at rates of exchange in effect throughout the

period. Foreign currency gains (losses) resulting from transactions outside of the functional currency of an entity of

$1.0 million and$2.9 million for thethree months ended September 30, 2026 and 2025, respectively, and

$3.9 million and$(22.2) million for thenine months ended September 30, 2026 and 2025, respectively, are included

in general, administrative and other expenses in the condensed consolidated statements of operations.

Recent Accounting Pronouncements

The Company considers the applicability and impact of all accounting standard updates (“ASU”) issued by the

Financial Accounting Standards Board (“FASB”). ASUs not listed below were assessed and either determined to be

not applicable or expected to have minimal impact on the Company’s condensed consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expenses, which

requires disaggregated disclosures of certain categories of expenses on an annual and interim basis including

employee compensation, depreciation, and intangible asset amortization for each income statement line item that

contains those expenses. The guidance is effective for annual periods beginning after December 15, 2026 and

interim periods beginning after December 15, 2027. The Company is currently evaluating the impact of adopting this

guidance on its condensed consolidated financial statements.

In September 2025, the FASB issued ASU 2025-06, Targeted Improvements to the Accounting for Internal-

Use Software, which clarifies the threshold for capitalizing internal-use software costs to be based on when (i)

management has authorized and committed to funding the software project and (ii) it is probable that the project will

be completed and the software will be used to perform the function intended. The guidance is effective for annual

periods beginning after December 15, 2027 and interim periods within those annual reporting periods. Early

adoption is permitted, and the amendments in this update may be applied on a prospective, retrospective or

modified basis. The Company is currently evaluating the impact of adopting this guidance on its condensed

consolidated financial statements.

In September 2026, the FASB issued ASU 2026-03, Investment Companies with Equity Securities Subject to

Contractual Sale Restrictions, which changes how investment companies in the scope of ASC 946, Financial

Services — Investment Companies, measure the fair value of an equity security that is subject to a contractual

restriction that prohibits the sale of the security. The guidance is effective for annual reporting periods beginning

after December 15, 2027, and interim periods within those annual reporting periods. Early adoption is permitted,

and the amendments in this update are required to be applied on a prospective basis. The Company is currently

evaluating the impact of adopting this guidance on its condensed consolidated financial statements.

3. Fair Value Measurement

The following table summarizes the Company’s assets and liabilities measured at fair value on a recurring

basis by the fair value hierarchy levels as disclosed in Note 2, Summary of Significant Accounting Policies, as of

September 30, 2026:

(1)This balance excludes$1.7 billion of Investments of Consolidated Funds that are included in Investments measured at

net asset value, which relate to certain consolidated investment fund of funds in the Company’s Carlyle AlpInvest

(2)This balance includes$773.6 million related to investments that have been bridged by a subsidiary of the Company to

investment funds and are accounted for as consolidated VIEs as of September 30, 2026. The Company’s subsidiary,

which is accounted for as a consolidated VIE, has entered into warehouse agreements with certain funds to transfer

certain of these investments at a price agreed upon by the parties, which may differ from fair value.

(3)The Level III balance excludes$97.8 million related tofour corporate investments in equity securities which the Company

has elected to account for under the measurement alternative for equity securities without readily determinable fair

values pursuant to ASC 321, Investments–Equity Securities. As a non-recurring fair value measurement, the fair value of

these equity securities is excluded from the tabular Level III rollforward disclosures.

(4)Senior and subordinated notes issued by CLO vehicles are valued based on the more observable fair value of the CLO

financial assets, less (i) the fair value ofany beneficial interests held by the Company and (ii) the carrying value of any

(5)Loans payable of Consolidated Funds balance excludes$926.7 million of senior notes measured at amortized cost and a

$33.9 million revolving credit balance, which relate to certain consolidated investment fund of funds in the Company’s

Carlyle AlpInvest segment.

The following table summarizes the Company’s assets and liabilities measured at fair value on a recurring

basis by the above fair value hierarchy levels as of December 31, 2025:

(1)This balance excludes$1.3 billion of Investments of Consolidated Funds that are included in Investments measured at

net asset value, which relate to certain consolidated investment fund of funds in the Company’s Carlyle AlpInvest

(2)This balance includes$989.4 million related to investments that have been bridged by a subsidiary of the Company to

investment funds and are accounted for as consolidated VIEs as of December 31, 2025. The Company’s subsidiary,

which is accounted for as a consolidated VIE, has entered into warehouse agreements with certain funds to transfer

certain of these investments at a price agreed upon by the parties, which may differ from fair value.

(3)The Level III balance excludes$63.0 million related to three corporate investments in equity securities which the

Company has elected to account for under the measurement alternative for equity securities without readily determinable

fair values pursuant to ASC 321, Investments–Equity Securities. As a non-recurring fair value measurement, the fair

value of these equity securities is excluded from the tabular Level III rollforward disclosures.

(4)Senior and subordinated notes issued by CLO vehicles are valued based on the more observable fair value of the CLO

(5)Loans payable of Consolidated Funds balance excludes$939.9 million of senior notes measured at amortized cost and a

$63.0 million revolving credit balance, which relate to certain consolidated investment fund of funds in the Company’s

Carlyle AlpInvest segment.

The changes in financial instruments measured at fair value for which the Company has used Level III inputs

to determine fair value are as follows (Dollars in millions):

(1)As a result of the initial consolidation oftwo funds during thethree months ended September 30, 2026.

(2)As a result of the initial consolidation ofthree funds and deconsolidation offive funds during thenine months ended

September 30, 2026.

(1)As a result of the initial consolidation ofthree funds and deconsolidation ofone fund during thethree months ended

September 30, 2025.

(2)As a result of the initial consolidation offour funds and deconsolidation oftwo funds during thenine months ended

September 30, 2025.

(3)Represents the exchange of the BDC Preferred Shares, which were valued using Level III inputs, for common shares of

CGBD, which were valued using Level I inputs. See Note 9, Related Party Transactions, to our Annual Report on Form 10-

K for the year ended December 31, 2025 for more information.

(1)As a result of the initial consolidation ofone fund during thethree months ended September 30, 2026, and the

initial consolidation ofthree funds and deconsolidation ofone fund during thethree months ended September 30,

(2)As a result of the initial consolidation offour funds and the deconsolidation offour funds during thenine months

ended September 30, 2026, and the initial consolidation offour fundsand deconsolidation oftwo funds during

thenine months ended September 30, 2025.

Realized and unrealized gains and losses included in earnings for Level III investments for investments in

CLOs and other investments are included in investment income (loss), and such gains and losses for investments of

Consolidated Funds and loans payable of the Consolidated Funds are included in Net investment income of

Consolidated Funds in the condensed consolidated statements of operations.

Gains and losses included in other comprehensive income for all Level III financial assets and liabilities are

included in accumulated other comprehensive loss and non-controlling interests in consolidated entities.

The following table summarizes quantitative information about the Company’s Level III inputs as of

September 30, 2026:

(1)Fair value approximates transaction price that was in close proximity to the reporting date.

(2)Senior and subordinated notes issued by CLO vehicles are classified based on the more observable fair value of the CLO

The following table summarizes quantitative information about the Company’s Level III inputs as of

December 31, 2025:

(1)Fair value approximates transaction price that was in close proximity to the reporting date.

(2)Senior and subordinated notes issued by CLO vehicles are classified based on the more observable fair value of the CLO

4. Investments

Investments consist of the following:

Accrued Performance Allocations

The components of accrued performance allocations are as follows:

Approximately 12% of accrued performance allocations at September 30, 2026 were related to Carlyle

Partners VIII, L.P., one of the Company’s Global Private Equity funds. Approximately 24% of accrued performance

allocations at December 31, 2025 were related to Carlyle Partners VII, L.P., one of the Company’s Global Private

Equity funds.

Accrued performance allocations are shown gross of the Company’s accrued performance allocations and

incentive fee related compensation (see Note 6, Accrued Compensation and Benefits) and accrued giveback

obligations, which are separately presented in the condensed consolidated balance sheets, as well as the portion

attributable to non-controlling interests.

The components of the accrued giveback obligations are as follows:

Principal Equity Method Investments, Excluding Performance Allocations

The Company’s principal equity method investments (excluding performance allocations) include its fund

investments in Global Private Equity, Global Credit, and Carlyle AlpInvest typically as general partner interests, and

its investments in Fortitude through a Carlyle-affiliated fund (included within Global Credit) and NGP (included within

Global Private Equity), which are not consolidated. Principal investments are related to the following segments:

(1)The balance includes$640.9 million and$616.0 million as of September 30, 2026 and December 31, 2025,

respectively, related to the Company’s equity method investments in NGP.

(2)The balance includes$743.0 million and$722.4 million as of September 30, 2026 and December 31, 2025,

respectively, related to the Company’s investment in Fortitude.

Investment in Fortitude

Carlyle FRL, L.P. (“Carlyle FRL”), a Carlyle-affiliated investment fund, holds a 38.5% interest in FGH Parent,

L.P. (“FGH Parent” or “Fortitude”), an insurance and reinsurance company. The Company indirectly owns 10.5% of

Fortitude, and Carlyle FRL and other strategic third-party investors collectively hold a 97.5% interest in Fortitude. As

of September 30, 2026, the carrying value of the Company’s investment in Carlyle FRL, which is an investment

company that accounts for its investment in Fortitude at fair value, was$743.0 million, relative to equity invested of

$666.8 million.

Fortitude declared and paid dividends of$300.0 million in each of September 2026 and 2025, of which

$31.3 million and$31.4 million, respectively, were distributed to the Company from Carlyle FRL and recognized as

realized principal investment income in the condensed consolidated statements of operations for thethree and nine

months ended September 30, 2026 and 2025.

The Company has an asset management relationship with Fortitude pursuant to which Fortitude committed to

allocate assets in asset management strategies and vehicles of the Company and its affiliates. As of September 30,

2026, Fortitude, its affiliates and certain Fortitude reinsurance counterparties have committed approximately

$27.4 billion of capital to-date to various Carlyle strategies. The Company has a strategic advisory services

agreement in place with certain subsidiaries of Fortitude through Carlyle Insurance Solutions Management L.L.C.

(“CISM”), an investment adviser. Under the agreement, CISM provides Fortitude with certain services, including

business development and growth, transaction origination and execution, and capital management services in

exchange for a recurring management fee based on Fortitude’s general account assets, which adjusts within an

agreed range based on Fortitude’s overall profitability.

Investment in NGP

The Company has equity interests in NGP Management Company, L.L.C. (“NGP Management”), the general

partners of certain carry funds advised by NGP, and principal investments in certain NGP funds as described below.

These investments are included in the Global Private Equity segment. NGP Management serves as the investment

advisor to the NGP Energy Funds. The Company does not control NGP and accounts for its investments in NGP

under the equity method of accounting.

The Company’s investments in NGP as of September 30, 2026 and December 31, 2025 are as follows:

See Note 4, Investments, to our Annual Report on Form 10-K for the year ended December 31, 2025 for

additional information regarding the restructuring of the terms of the Company’s strategic investment in NGP (the

“Restructuring”). As a result of the Restructuring, thenine months ended September 30, 2025 included a

$92.5 million impairment of the Company’s investment in NGP Management and a$38.0 million reduction in

accrued performance allocations, which were recorded in Principal investment income (loss) in the condensed

consolidated statements of operations and excluded from Distributable Earnings, as defined in Note 14, Segment

Reporting. The Company amortizes basis differences established in connection with the Restructuring as a

reduction to Principal investment income over their estimated useful lives.

Investment in NGP Management. The Company’s equity interests in NGP Management entitle the Company

to an allocation of income equal to 55.0% of the management fee related revenues earned by existing funds prior to

the Restructuring that held an initial closing after December 31, 2024, and up to 55.0% of management fee related

revenues on future NGP funds subsequent to the Restructuring in the aggregate, which are based on a sliding

scale, including all management fees being retained by NGP for the years 2025 through 2028 on such future NGP

funds. The Company records investment income (loss) for its equity income allocation from NGP management fee

related revenues and also records its share of any allocated expenses from NGP Management, expenses

associated with the compensatory elements of the investment, and any impairment charges. The net investment

income (loss) recognized in the Company’s condensed consolidated statements of operations for thethree and nine

months ended September 30, 2026 and 2025 related to its investment in NGP Management were as follows:

Management fee related revenues from NGP Management were primarily driven by NGP XI, NGP XII, and

NGP XIII during thethree and nine months ended September 30, 2026 and 2025. These funds calculate

management fees as 1.5% of the limited partners’ commitments less any return of capital or write-offs during the

investment period. Following the investment period, the basis on which fund management fees are generally

calculated is further reduced by a reserve for future management fees and operating costs.

Investment in the General Partners of NGP Carry Funds. The Company’s investment in the general partners

of the NGP Carry Funds entitles it to up to 47.5% of performance allocations received by NGP Fund general

partners. The Company records its equity income allocation from NGP performance allocations in principal

investment income (loss) from equity method investments rather than performance allocations in its condensed

consolidated statements of operations. The Company recognized net investment earnings(losses) related to these

performance allocations of$49.8 million and$23.8 million for thethree months ended September 30, 2026 and

2025, respectively, and$132.1 million and$22.9 million for thenine months ended September 30, 2026 and 2025,

respectively, in its condensed consolidated statements of operations. Thenine months ended September 30, 2025

included a$38.0 million reduction related to the Restructuring.

Principal Investments in NGP Funds. The Company also holds principal investments in the NGP Carry Funds.

The Company recognized net investment earnings (losses) related to these investments in principal investment

income (loss) in its condensed consolidated statements of operations of$7.0 million and$3.3 million for thethree

months ended September 30, 2026 and 2025, respectively, and$18.2 million and$8.8 million for thenine months

ended September 30, 2026 and 2025, respectively.

Principal Investments in CLOs and Other Investments

Principal investments in CLOs as of September 30, 2026 and December 31, 2025 were$293.2 million and

$349.0 million, respectively, and consisted of investments in CLO senior and subordinated notes. A portion of the

Company’s principal investments in CLOs is collateral to CLO term loans (see Note 5, Borrowings). As of

September 30, 2026 and December 31, 2025, other investments included the Company’s investment in common

shares of CGBD at fair value of$33.3 million and$37.5 million, respectively.

Investment Income (Loss)

The components of investment income (loss) are as follows:

The performance allocations included in revenues are derived from the following segments:

The following tables summarize the funds that are the primary drivers of performance allocations for thethree

and nine months ended September 30, 2026 and 2025, as well as the total revenue recognized, including

performance allocations, fund management fees and principal investment income:

Carlyle’s income (loss) from its principal equity method investments consists of:

Investments of Consolidated Funds

The Company consolidates the financial positions and results of operations of certain CLOs in which it is the

primary beneficiary. During thenine months ended September 30, 2026, the Company became the primary

beneficiary ofsix additional CLOs. Investments in Consolidated Funds as of September 30, 2026 and December 31,

2025 also included$773.6 million and$989.4 million, respectively, related to investments that have been bridged by

the Company to investment funds in the Global Private Equity and Carlyle AlpInvest segments that are accounted

for as consolidated VIEs.

There were no individual investments with a fair value greater than five percent of the Company’s total assets

for any period presented.

Interest and Other Income of Consolidated Funds

The components of interest and other income of Consolidated Funds are as follows:

Net Investment Income (Loss) of Consolidated Funds

Net investment income (loss) of Consolidated Funds includes net realized gains (losses) from sales of

investments and unrealized gains (losses) resulting from changes in fair value of the Consolidated Funds’

investments. The components of Net investment income (loss) of Consolidated Funds are as follows:

The following table presents realized and unrealized gains (losses) earned from investments of the

Consolidated Funds (including consolidated CLOs):

5. Borrowings

The Company borrows and enters into credit agreements for its general operating and investment purposes.

The Company’s debt obligations consist of the following:

Senior Credit Facility

The senior credit facility consists of a$1.0 billion revolving credit facility, which was amended in May 2025 to

extend the maturity date from April 29, 2027 to May 29, 2030. The Company is required to maintain management

fee-earning assets of at least$156.9 billion and a total leverage ratio of less than 4.0 to 1.0, in each case, tested on

a quarterly basis. The Company’s borrowing capacity is subject to the ability of the financial institutions in the

banking syndicate to fulfill their respective obligations under the revolving credit facility. Principal amounts

outstanding under the revolving credit facility accrue interest, at the option of the borrowers, either (a) at an

alternate base rate plus an applicable margin not to exceed 0.50% per annum, or (b) at SOFR (or similar

benchmark rate for non-U.S. dollar borrowings) plus a 0.10% adjustment and an applicable margin not to exceed

1.50% per annum (at September 30, 2026, the interest rate was 5.01%). The Company madeno borrowings under

the revolving credit facility during thethree and nine months ended September 30, 2026 and 2025, and there was

no amount outstanding as of September 30, 2026.

Global Credit Revolving Credit Facility

Certain subsidiaries of the Company are parties to a revolving line of credit, primarily intended to support

certain lending activities within the Global Credit segment. As currently amended, the Global Credit Revolving Credit

Facility provides for a revolving line of credit with a capacity of$300 million, which matures in September 2027, and

a second revolving line of credit with a capacity of$200 million, which the Company amended in August 2026 to

extend the maturity date to August 18, 2027. The Company’s borrowing capacity is subject to the ability of the

financial institutions in the banking syndicate to fulfill their respective obligations under the Global Credit Revolving

Credit Facility. Principal amounts outstanding accrue interest at applicable SOFR or Eurocurrency rates plus an

applicable margin of 2.00% or an alternate base rate plus an applicable margin of 1.00%. During thethree and nine

months ended September 30, 2026 and 2025, the Company madeno borrowings under the Global Credit Revolving

Credit Facility. As of September 30, 2026, there wasno borrowing outstanding under the Global Credit Revolving

Credit Facility.

CLO Borrowings

For certain of the Company’s CLOs, the Company finances a portion of its investment in the CLOs through the

proceeds received from term loans and other financing arrangements with financial institutions. The following table

provides information regarding total outstanding CLO borrowings as of September 30, 2026 and December 31,

2025 (Dollars in millions):

The CLO term loans are secured by the Company’s investments in the respective CLO, have a general

unsecured interest in the Carlyle entity that manages the CLO, and generally do not have recourse to any other

Carlyle entity. Interest expense for thethree months ended September 30, 2026 and 2025 was$4.6 million and$3.7

million, respectively. Interest expense for thenine months ended September 30, 2026 and 2025 was$12.6 million

and$11.5 million, respectively. The fair value of the outstanding balance of the CLO term loans at September 30,

2026 approximated par value based on current market rates for similar debt instruments. These CLO term loans are

classified as Level III within the fair value hierarchy.

CLO Repurchase Agreements

The Company is party to master credit facility agreements (the “CLO Financing Facilities”) to finance a portion

of the risk retention investments in certain CLOs managed by the Company. Each transaction entered into under the

CLO Financing Facilities bears interest at a rate based on the weighted average effective interest rate of each class

of securities that have been sold plus a spread agreed upon by the parties. As of September 30, 2026,

$358.6 million was outstanding under the CLO Financing Facilities, which includes€296.0 million ($335.6 million) in

borrowings made in Euro. Additional borrowings may be made on terms agreed upon by the Company and the

counterparty subject to the terms and conditions of the CLO Financing Facilities.

Each transaction entered into under the CLO Financing Facilities provides for payment netting and, in the

case of a default or similar event with respect to the counterparty to the CLO Financing Facilities, provides for

netting across transactions. Generally, upon a counterparty default, the Company can terminate all transactions

under the CLO Financing Facilities and offset amounts it owes in respect of any one transaction against collateral, if

any, or other amounts it has received in respect of any other transactions under the CLO Financing Facilities;

provided, however, that in the case of certain defaults, the Company may only be able to terminate and offset solely

with respect to the transaction affected by the default. During the term of a transaction entered into under the CLO

Financing Facilities, the Company will deliver cash or additional securities acceptable to the counterparty if the

securities sold are in default. Upon termination of a transaction, the Company will repurchase the previously sold

securities from the counterparty at a previously determined repurchase price. The CLO Financing Facilities may be

terminated at any time upon certain defaults or circumstances agreed upon by the parties.

The Repurchase Agreements may result in credit exposure in the event the counterparty to the transaction is

unable to fulfill its contractual obligations. The Company minimizes the credit risk associated with these activities by

monitoring counterparty credit exposure and collateral values. Other than margin requirements, the Company is not

subject to additional terms or contingencies which would expose the Company to additional obligations based upon

the performance of the securities pledged as collateral.

Senior Notes

The Company and certain indirect subsidiaries of the Company have issued long term borrowings in the form

of senior notes, on which interest is payable semi-annually in arrears. The following table provides information

regarding these senior notes (Dollars in millions):

(1)Including accrued interest. Fair value is based on indicative quotes and the notes are classified as Level II within

the fair value hierarchy.

(2)Issued in September 2019 at 99.841% of par.

(3)Issued in September 2025 at 99.767% of par.

(4)Issued$400.0 million in aggregate principal at 99.583% of par in March 2013. An additional$200.0 million in

aggregate principal was issued at 104.315% of par in March 2014, and is treated as a single class with the

outstanding$400.0 million in senior notes previously issued.

(5)Issued in September 2018 at 99.914% of par.

The issuers may redeem the senior notes, in whole at any time or in part from time to time, at a price equal to

the greater of (i)100% of the principal amount of the notes being redeemed and (ii) the sum of the present values of

the remaining scheduled payments of principal and interest on any notes being redeemed (less interest accrued to

the date of redemption) discounted to the redemption date on a semiannual basis at the Treasury Rate plus 40

basis points (30 basis points in the case of the 3.500% senior notes and 20 basis points in the case of the 5.050%

senior notes), plus in each case accrued and unpaid interest on the principal amounts being redeemed.

Subordinated Notes

In May 2021, an indirect subsidiary of the Company issued$435.0 million aggregate principal amount of

4.625% Subordinated Notes due May 15, 2061 (the “Subordinated Notes”), on which interest is payable quarterly

accruing from May 11, 2021. In June 2021, an additional$65.0 million aggregate principal amount of these

Subordinated Notes were issued and are treated as a single series with the already outstanding$435.0 million

aggregate principal amount. The Subordinated Notes are unsecured and subordinated obligations of the issuer, and

are fully and unconditionally guaranteed (the “Guarantees”), jointly and severally, on a subordinated basis, by the

Company, each of the Carlyle Holdings partnerships, and CG Subsidiary Holdings L.L.C., an indirect subsidiary of

the Company (collectively, the “Guarantors”). The Consolidated Funds are not guarantors, and as such, the assets

of the Consolidated Funds are not available to service the Subordinated Notes under the Guarantee. The

Subordinated Notes may be redeemed at the issuer’s option, in whole or in part, at any time and from time to time,

prior to their stated maturity, at a redemption price equal to their principal amount plus any accrued and unpaid

interest to, but excluding, the redemption date. If interest due on the Subordinated Notes is deemed to no longer be

deductible in the U.S., the Subordinated Notes may be redeemed, in whole, but not in part, within 120 days of the

occurrence of such event at a redemption price equal to their principal amount plus accrued and unpaid interest to,

but excluding, the redemption date.

As of September 30, 2026 and December 31, 2025, the fair value of the Subordinated Notes was

$301.4 million and$342.0 million, respectively. Fair value is based on active market quotes and the notes are

classified as Level I within the fair value hierarchy. For both thethree months ended September 30, 2026 and 2025,

the Company incurred$5.8 million of interest expense on the Subordinated Notes. For both thenine months ended

September 30, 2026 and 2025, the Company incurred$17.6 million of interest expense on the Subordinated Notes.

Debt Covenants

The Company is subject to various financial and non-financial covenants under its loan agreements and the

indentures governing its senior notes. The Company was in compliance with all financial and non-financial

covenants under its various loan agreements as of September 30, 2026.

Loans Payable of Consolidated Funds

Loans payable of Consolidated Funds primarily represent amounts due to holders of debt securities issued by

the CLOs. As of September 30, 2026 and December 31, 2025, the following borrowings were outstanding (Dollars in

millions):

(1)Borrowing Outstanding as of September 30, 2026 includes $937.5 million of senior secured notes that are measured at

amortized cost, which approximates fair value. Fair Value as of September 30, 2026 and December 31, 2025 includes

the carrying value of these notes of$926.7 million and$939.9 million, respectively. These senior secured notes were

classified as Level III within the fair value hierarchy.

(2)Fair Value as of September 30, 2026 and December 31, 2025 reflects the amortized cost of outstanding revolving credit

balances which approximates fair value.

(3)The subordinated notes do not have contractual interest rates, but instead receive distributions from the excess cash

flows of the CLOs.

Loans payable of the CLOs are collateralized by the assets held by the CLOs and the assets of one CLO may

not be used to satisfy the liabilities of another. This collateral consisted of cash and cash equivalents, corporate

loans, corporate bonds and other securities. The Company is not liable forany loans payable of the CLOs. As of

September 30, 2026 and December 31, 2025, total assets of the CLOs were$11.8 billion and$11.0 billion,

respectively.

6. Accrued Compensation and Benefits

Accrued compensation and benefits consist of the following:

The following table presents realized and unrealized performance allocations and incentive fee related

compensation:

7. Commitments and Contingencies

Capital Commitments

The Company and its unconsolidated affiliates have unfunded commitments totaling $4.3 billion as of

September 30, 2026, of which approximately$3.2 billion is subscribed individually by senior Carlyle professionals,

advisors and other professionals. In addition to these unfunded commitments, the Company may from time to time

exercise its right to purchase additional interests in its investment funds that become available in the ordinary

course of their operations.

Under the Carlyle Global Capital Markets platform, certain subsidiaries of the Company may act as an

underwriter, syndicator or placement agent for security offerings and loan originations. The Company earns fees in

connection with these activities and bears the risk of the sale of such securities and placement of such loans, which

may be longer dated. As of September 30, 2026, the Company had no material commitments related to the

origination and syndication of loans and securities under the Carlyle Global Capital Markets platform.

Guaranteed Loans

From time to time, the Company or its subsidiaries may enter into agreements to guarantee certain obligations

of the investment funds related to, for example, credit facilities or equity commitments. Certain consolidated

subsidiaries of the Company are the guarantors of revolving credit facilities for certain funds in the Carlyle AlpInvest

segment. The guarantee is limited to the lesser of the total amount drawn under the credit facilities or the total of net

asset value of the guarantor subsidiaries plus any uncalled capital of the applicable general partner. The

outstanding balances are secured by uncalled capital commitments from the underlying funds, and the Company

believes the likelihood of any material funding under this guarantee to be remote. As of September 30, 2026, the

Company hadno material outstanding guarantees under the credit facilities.

In February 2026, the Company entered into an agreement pursuant to which it provided support for a credit

facility of a certain fund in the Global Credit segment. The maximum aggregate amount that could be funded under

this agreement was approximately$120.0 million as of September 30, 2026. Theagreement will remain effective for

the term of the credit facility, including any extensions thereof, unless terminated earlier in accordance with the

terms of the credit facility. The Company has not funded any amounts under this agreement to date and believes the

likelihood of any material funding to be remote.

In June 2026, certain consolidated subsidiaries of the Company are the guarantors of a credit agreement for a

fund in the Carlyle AlpInvest segment, which is scheduled to expire on December 16, 2026. The maximum potential

amount to be funded under this guarantee is$30.0 million. The outstanding balances under the credit agreement

are collateralized by the investments in the fund, and the Company believes the likelihood of any material funding

under this guarantee to be remote.

In July 2026, the Company entered into an agreement with a financial institution pursuant to which it provided

the guarantee for an unsecured revolving credit facility of an investment fund that is actively fundraising in the

Global Private Equity segment. The maximum aggregate amount available under the facility is$400.0 million, with

$228.0 million outstanding as of September 30, 2026. This facility matures in April 2027 with the possibility to extend

to July 2027. The Company has not funded any amounts under this guarantee to date and believes the likelihood of

any material funding to be remote.

Contingent Obligations

Giveback

A liability for potential repayment of previously received performance allocations of$120.2 million and$72.8

million at September 30, 2026 and December 31, 2025, respectively, is shown as accrued giveback obligations in

the condensed consolidated balance sheets, representing the giveback obligation that would need to be paid if the

funds were liquidated at their current fair values at September 30, 2026 and December 31, 2025, respectively.

However, the ultimate giveback obligation, if any, generally is not paid until the end of a fund’s life or earlier if the

giveback becomes fixed and early payment is agreed upon by the fund’s partners (see Note 2, Summary of

Significant Accounting Policies). The Company had$51.7 million and$24.2 million of unbilled receivables from

former and current employees and senior Carlyle professionals as of September 30, 2026 and December 31, 2025,

respectively, related to giveback obligations. Any such receivables are collateralized by investments made by

individual senior Carlyle professionals and employees in Carlyle-sponsored funds. In addition, as of September 30,

2026 and December 31, 2025,$160.9 million and$151.5 million, respectively, have been withheld from distributions

of carried interest to senior Carlyle professionals and employees for potential giveback obligations. Such amounts

are held on behalf of the respective current and former Carlyle employees to satisfy any givebacks they may owe

and are held by entities not included in the accompanying condensed consolidated balance sheets. Current and

former senior Carlyle professionals and employees are personally responsible for their giveback obligations. As of

September 30, 2026, approximately$51.7 million of the Company’s accrued giveback obligation is the responsibility

of various current and former senior Carlyle professionals and other former limited partners of the Carlyle Holdings

partnerships, and the net accrued giveback obligation attributable to the Company is$68.5 million.

If, at September 30, 2026, all of the investments held by the Company’s Funds were deemed worthless, a

possibility that management views as remote, the amount of realized and distributed carried interest subject to

potential giveback would be$1.5 billion, on an after-tax basis where applicable, of which approximately$0.5 billion

would be the responsibility of current and former senior Carlyle professionals.

Other

In April 2026, in connection with an investment fund that is actively fundraising in the Global Private Equity

segment, the Company entered into an arrangement with a third party pursuant to which the third party subscribed

for a$500.0 million commitment in the investment fund (the “Warehoused Interests”), with the Company obligated to

acquire any unsold Warehoused Interests as of December 31, 2026. As of September 30, 2026,$450.2 million of

Warehoused Interests had been sold to other investors, and the remaining$49.8 million continued to be held by the

third party. In October 2026, the remaining Warehoused Interests were sold to other investors.

In connection with a consolidated investment fund in the Carlyle AlpInvest segment, the Company entered into

an arrangement with a third party pursuant to which the Company may be required to make payments up to

$50.0 million in the aggregate in the event the fund does not achieve a specified return. As of September 30, 2026,

the Company has concluded that the likelihood of payment under this arrangement is not probable; therefore, no

liability has been recorded.

Legal Matters

In the ordinary course of business, the Company is a party to litigation, investigations, inquiries, employment-

related matters, disputes, and other potential claims. Certain of these matters are described below. The Company is

not currently able to estimate the reasonably possible amount of loss or range of loss, in excess of amounts

accrued, for the matters that have not been resolved. Although it is not possible to predict the ultimate outcome of

these unresolved matters, the Company does not believe it is probable that the outcome of any existing litigation,

investigations, disputes, or claims will materially affect the Company or these financial statements in excess of

amounts accrued.

The Tax Receivable Agreement Matter

The Company came into existence on January 1, 2020, when its predecessor, The Carlyle Group L.P. (the

“PTP”), converted from a partnership into a corporation(the “Conversion”). On July 29, 2022, an alleged stockholder

of the Company, the City of Pittsburgh Comprehensive Municipal Trust Fund (the “original Plaintiff”), filed suit in the

Delaware Court of Chancery, alleging a direct claim against the Company for breach of its certificate of

incorporation and a derivative claim on behalf of the Company against certain current and former officers and

directors of the Company. As the original Plaintiff did not actually own shares on the date of the Conversion, it

stipulated to the dismissal of the derivative claims in October of 2025 and the Court has allowed Charles Blackburn

(together with the original Plaintiff, “Plaintiffs”) to intervene as a new plaintiff with respect to the derivative claims.

The original Plaintiff continues as a plaintiff with respect to one direct claim.

Plaintiffs challenge the receipt, by certain officers of the PTP and certain directors of the general partner of the

PTP, of a right to cash payments associated with the elimination of a tax receivable agreement in connection with

the Conversion. Plaintiffs are seeking monetary damages, restitution, and an injunction preventing the Company

from making any future cash payments for the elimination of the tax receivable agreement in connection with the

Conversion. By virtue of the derivative nature of the primary claims (i.e., that the claims are aimed primarily at

certain officers and directors), it is unlikely that the Company itself will pay material damage awards based on the

derivative claims, although the Company is expected to incur legal defense fees to the extent not covered by

insurance. The Delaware Court issued a ruling on the defendants’ motion to dismiss on April 24, 2024, dismissing

some of the original Plaintiff’s claims but allowing most of the claims to proceed to discovery and possibly to trial.

Plaintiffs filed a consolidated amended complaint on November 17, 2025. Defendants filed a motion to dismiss the

consolidated amended complaint on January 16, 2026, which remains pending. The Company intends to continue

to contest the direct claims vigorously, and the officer and director defendants intend to continue contesting the

derivative claims vigorously.

General

The Company currently is and expects to continue to be, from time to time, subject to examinations, formal

and informal inquiries, and investigations by various U.S. and non-U.S. governmental and regulatory agencies,

including but not limited to, the SEC, Department of Justice, state attorneys general, FINRA, National Futures

Association, and the U.K. Financial Conduct Authority. The Company routinely cooperates with such examinations,

inquiries and investigations, and they may result in the commencement of civil, criminal, or administrative or other

proceedings against the Company or its personnel.

It is not possible to predict the ultimate outcome of all pending investigations and legal proceedings and

employment-related matters, and some of the matters discussed above involve claims for potentially large and/or

indeterminate amounts of damages. Based on information known by management, management does not believe

that as of the date of this filing the final resolutions of the matters above will have a material effect upon the

Company’s condensed consolidated financial statements. However, given the potentially large and/or indeterminate

amounts of damages sought in certain of these matters and the inherent unpredictability of investigations and

litigations, it is possible that an adverse outcome in certain matters could, from time to time, have a material effect

on the Company’s financial results in any particular period.

The Company accrues an estimated loss contingency liability when it is probable that such a liability has been

incurred and the amount of the loss can be reasonably estimated. The Company evaluates its outstanding legal and

regulatory proceedings and other matters each quarter to assess its loss contingency accruals, and makes

adjustments in such accruals, upward or downward, as appropriate, based on management’s best judgment after

consultation with counsel. There is no assurance that the Company’s accruals for loss contingencies will not need to

be adjusted in the future or that, in light of the uncertainties involved in such matters, the ultimate resolution of these

matters will not significantly exceed the accruals that the Company has recorded.

Indemnifications

In the normal course of business, the Company and its subsidiaries enter into contracts that contain a variety

of representations and warranties and provide general indemnifications. The Company’s maximum exposure under

these arrangements is unknown as this would involve future claims that may be made against the Company that

have not yet occurred. However, based on experience, the Company believes the risk of material loss to be remote.

In connection with the sale of the Company’s interest in its local Brazilian management entity in August 2021,

the Company provided a guarantee to the acquiring company of up to BRL 100.0 million ($19.3 million as of

September 30, 2026) for liabilities arising from tax-related indemnifications. This guarantee, which will expire in

August 2027, would only come into effect after all alternative remedies have been exhausted. The Company

believes the likelihood of any material funding under this guarantee to be remote.

Risks and Uncertainties

Carlyle’s funds seek investment opportunities that offer the possibility of attaining substantial capital

appreciation. Certain events particular to each industry in which the underlying investees conduct their operations,

as well as general economic, political, regulatory, and public health conditions, may have a significant negative

impact on the Company’s investments and profitability. The funds managed by the Company may also experience a

slowdown in the deployment of capital, which could adversely affect the Company’s ability to raise capital for new or

successor funds and could also impact the management fees the Company earns on its carry funds and managed

accounts, and/or result in the impairment of intangible assets and/orgoodwill in the case of the Company’s acquired

businesses. Such events are beyond the Company’s control, and the likelihood that they may occur and the effect

on the Company cannot be predicted.

Furthermore, certain of the funds’ investments are made in private companies and there are generally no

public markets for the underlying securities at the current time. The funds’ ability to liquidate their publicly traded

investments is often subject to limitations, including discounts that may be required to be taken on quoted prices

due to the number of shares being sold. The funds’ ability to liquidate their investments and realize value is subject

to significant limitations and uncertainties, including among others currency fluctuations and natural disasters.

The Company and the funds make investments outside of the United States. Investments outside the United

States may be subject to less developed bankruptcy, corporate, partnership and other laws (which may have the

effect of disregarding or otherwise circumventing the limited liability structures potentially causing the actions or

liabilities of one fund or a portfolio company to adversely impact the Company or an unrelated fund or portfolio

company). Non-U.S. investments are subject to the same risks associated with the Company’s U.S. investments as

well as additional risks, such as fluctuations in foreign currency exchange rates, unexpected changes in regulatory

requirements, heightened risk of political and economic instability, difficulties in managing non-U.S. investments,

potentially adverse tax consequences, and the burden of complying with a wide variety of foreign laws.

Furthermore, Carlyle is exposed to economic risk concentrations related to certain large investments as well

as concentrations of investments in certain industries and geographies.

Additionally, the Company encounters credit risk. Credit risk is the risk of default by a counterparty in the

Company’s investments in debt securities, loans, leases, and derivatives that result from a borrower’s, lessee’s, or

derivative counterparty’s inability or unwillingness to make required or expected payments. The Company is subject

to credit risk should a financial institution be unable to fulfill its obligations.

The Company considers cash, cash equivalents, securities, receivables, principal equity method investments,

accounts payable, accrued expenses, other liabilities, loans, senior notes, assets, and liabilities of Consolidated

Funds and contingent and other consideration for acquisitions to be its financial instruments. Except for the senior

notes, subordinated notes, and compensatory contingent and other consideration for acquisitions, the carrying

amounts reported in the condensed consolidated balance sheets for these financial instruments equal or closely

approximate their fair values. The fair value of the senior and subordinated notes is disclosed in Note 5, Borrowings.

8. Related Party Transactions

Due from Affiliates and Other Receivables, Net

The Company had the following due from affiliates and other receivables at September 30, 2026 and

December 31, 2025:

Reimbursable expenses and other receivables from certain of the unconsolidated funds and portfolio

companies relate to advisory fees receivable and expenses paid on behalf of these entities. These costs generally

represent costs related to the pursuit of actual or proposed investments, professional fees, and expenses

associated with the acquisition, holding, and disposition of the investments. The affiliates are obligated at the

discretion of the Company to reimburse the expenses. Based on management’s determination, the Company may

accrue and charge interest on amounts due from affiliate accounts at interest rates ranging up to 7.05% as of

September 30, 2026. The accrued and charged interest to the affiliates was not significant for any period presented.

Notes receivable includes loans that the Company has provided to certain unconsolidated funds to meet short-

term obligations to purchase investments. Notes receivable as of September 30, 2026 and December 31, 2025 also

include interest-bearing loans of$39.2 million and $19.5 million, respectively, to certain eligible Carlyle employees,

which excludes Section 16 officers and other members of senior management, to finance their investments in

certain Carlyle sponsored funds. These advances accrue interest at rates which range between 5.05% and 6.00%

as of September 30, 2026.

These receivables are assessed regularly for collectability. Management fee receivable amounts determined

to be uncollectible are recorded as a reduction in revenue in the condensed consolidated statements of operations.

For all other receivables, amounts determined to be uncollectible are charged directly to general, administrative and

other expenses in the condensed consolidated statements of operations. A corresponding allowance for doubtful

accounts is recorded and such amounts were not significant for any period presented.

Due to Affiliates

The Company has recorded obligations for amounts due to certain of its affiliates. The Company periodically

offsets expenses it has paid on behalf of its affiliates against these obligations. The Company had the following due

to affiliates balances at September 30, 2026 and December 31, 2025:

In connection with the Company’s initial public offering, the Company entered into a tax receivable agreement

with the limited partners of the Carlyle Holdings partnerships whereby certain subsidiaries of the Partnership agreed

to pay to the limited partners of the Carlyle Holdings partnerships involved in any exchange transaction 85% of the

amount of cash tax savings, if any, in U.S. federal, state and local income tax realized as a result of increases in tax

basis resulting from exchanges of Carlyle Holdings Partnership units for common units of The Carlyle Group L.P.

Other Related Party Transactions

Aircraft Transactions

Entities controlled by our co-founders own aircraft that may be used for the Company’s business in the

ordinary course of its operations. The hourly rates that the Company pays for the use of these aircraft are based on

current market rates for chartering private aircraft of the same type. For thethree months ended September 30,

2026 and 2025, the Company incurred fees for the use of these aircraft of $1.0 million and $0.4 million, respectively.

For thenine months ended September 30, 2026 and 2025, the Company incurred fees for the use of these aircraft

of $1.9 million and $1.4 million, respectively. All payments were paid directly to the manager of the aircraft, and a

significant portion of the payments were ultimately paid to or were for the benefit of certain co-founders.

Other Transactions

Senior Carlyle professionals and employees are permitted to participate in co-investment entities that invest in

Carlyle funds or alongside Carlyle funds. In many cases, participation is limited by law to individuals who qualify

under applicable legal requirements. These co-investment entities generally do not require senior Carlyle

professionals and employees to pay management fees or performance allocations, however, Carlyle professionals

and employees are required to pay their portion of partnership expenses.

Carried interest income from certain funds can be distributed to senior Carlyle professionals and employees

on a current basis, but is subject to repayment by the subsidiary of the Company that acts as general partner of the

fund in the event of a realized giveback obligation. The senior Carlyle professionals and certain other investment

professionals have personally guaranteed, subject to certain limitations, the obligation of these subsidiaries in

respect of this general partner obligation. Such guarantees are several and not joint and are limited to a particular

individual’s distributions received.

The Company does business with some of its portfolio companies; all such arrangements are on a negotiated

basis.

Substantially all revenue is earned from affiliates of Carlyle.

9. Income Taxes

The effective tax rate for the three and nine months ended September 30, 2026 and 2025 primarily comprised

the 21% U.S. federal corporate income tax rate, the impact of U.S. state and foreign income taxes, the tax effects of

non-controlling interest, disallowed executive compensation, and equity-based compensation deductions. The

effective tax rate for the three months ended September 30, 2026 was 0% due to the offsetting effects of these rate

drivers and the benefit from non-taxable income. The effective tax rate for the three months ended September 30,

2025 was negative primarily due to the tax benefit from the pretax loss incurred prior to the effect of non-controlling

interest and due to the deduction related to the excess tax benefit from the vesting of restricted stock units in the

quarter. For the nine months ended September 30, 2026, the effective tax rate also included the impact of a one-

time tax expense related to a change in the tax classification of a consolidated subsidiary.

As of September 30, 2026 and December 31, 2025, the Company had federal, state, local and foreign taxes

payable of$82.7 million and$141.4 million, respectively, which is recorded as a component of accounts payable,

accrued expenses and other liabilities on the accompanying condensed consolidated balance sheets.

In the normal course of business, the Company is subject to examination by federal and certain state, local

and foreign tax regulators. As of September 30, 2026, the Company’s U.S. federal income tax returns for the years

2022 through 2025 are generally open under the normal three-year statute of limitations and therefore subject to

examination. State and local tax returns are generally subject to audit from 2020 to 2025. Foreign tax returns are

generally subject to audit from 2011 to 2025. Certain of the Company’s affiliates are currently under audit by federal,

state and foreign tax authorities. The Company does not believe that the outcome of the audits will require it to

record material reserves for uncertain tax positions or that the outcome will have a material impact on the

condensed consolidated financial statements.

On October 8, 2021, the OECD introduced a 15% global minimum tax under the Pillar Two GloBE model rules.

On January 5, 2026, the OECD announced a “side-by-side” system under which U.S.-parented groups would be

able to elect to be exempt from certain Pillar Two provisions. Additional guidance on the “side-by-side” system and

implementation of such system remain subject to further discussions and clarifications from the OECD and local

implementation by each OECD member country. Pillar Two has not had a material impact to the Company’s

provision for income taxes; however, the Company will continue to monitor as additional guidance is released by the

OECD, OECD member countries based on their enacted law changes, and other standard-setting bodies.

10. Non-controlling Interests in Consolidated Entities

The components of the Company’s non-controlling interests in consolidated entities are as follows:

The components of the Company’s non-controlling interests in income (loss) of consolidated entities are as

follows:

11. Earnings Per Common Share

Basic and diluted net income (loss) per common share are calculated as follows:

The weighted-average common shares outstanding, basic and diluted, are calculated as follows:

The Company applies the treasury stock method to determine the dilutive weighted-average common shares

represented by the unvested restricted stock units. Also included in the determination of dilutive weighted-average

common shares are issuable common shares associated with the Company’s investment in NGP and performance-

vesting restricted stock units. For thethree and nine months ended September 30, 2026, all such awards are

antidilutive and excluded from the computation of diluted earnings per share given the net loss attributable to

common shareholders.

12. Equity

Share Repurchase Program

The Board of Directors reset the total repurchase authorization of the Company’s previously approved share

repurchase program to$2.0 billion in shares of the Company’s common stock, effective as of February 26, 2026.

Under the share repurchase program, shares of the Company’s common stock may be repurchased from time to

time in open market transactions, in privately negotiated transactions, or otherwise, including through Rule 10b5-1

plans. The timing and actual number of shares of common stock repurchased will depend on a variety of factors,

including legal requirements and price, economic, and market conditions. In addition to repurchases of common

stock, the share repurchase program is used for the payment of tax withholding amounts upon net share settlement

of equity-based awards granted pursuant to our Equity Incentive Plan or otherwise based on the value of shares

withheld that would have otherwise been issued to the award holder. The share repurchase program may be

suspended or discontinued at any time and does not have a specified expiration date. As of September 30, 2026,

$1.4 billion of repurchase capacity remained under the program, which reflects both common shares repurchased

and shares retired in connection with the net share settlement of equity-based awards. The following table presents

the Company’s shares that have been repurchased or retired as a result of net share settlement of equity-based

awards during thethree and nine months ended September 30, 2026 and 2025. Dollar amounts exclude the impact

of excise taxes.

Dividends

The table below presents information regarding the quarterly dividends on the common shares, which were

made at the sole discretion of the Board of Directors of the Company.

The Board of Directors will take into account general economic and business conditions, as well as the

Company’s strategic plans and prospects, business and investment opportunities, financial condition and

obligations, legal, tax, and regulatory restrictions, other constraints on the payment of dividends by the Company to

its common shareholders or by subsidiaries to the Company, and other such factors as the Board of Directors may

deem relevant. In addition, the terms of the Company’s credit facility provide certain limits on the Company’s ability

to pay dividends.

13. Equity-Based Compensation

The Carlyle Group Inc. Amended and Restated 2012 Equity Incentive Plan (the “Equity Incentive Plan,” initially

adopted in May 2012 and as most recently amended and restated on June 3, 2026) is a source of equity-based

awards permitting the Company to grant to Carlyle employees, directors and consultants non-qualified options,

share appreciation rights, common shares, restricted stock units and other awards based on the Company’s shares

of common stock. A total of 77,800,000 shares of common stock are authorized for the grant of awards under the

Equity Incentive Plan, of which a total of 37,498,491 shares of the Company’s common stock remain available for

grant as of September 30, 2026.

A summary of the status of the Company’s unvested equity-based awards as of September 30, 2026 and a

summary of changes for thenine months ended September 30, 2026, are presented below:

(1)Includes shares reserved for issuance upon settlement of dividend-equivalent rights carried by certain restricted stock units

concurrently with the settlement of the restricted stock units for shares.

(2)Includes 4,406,553 shares that were retired in connection with the net share settlement of equity-based awards. The

Company paid$229.3 million of taxes related to the net share settlement of equity-based awards during thenine months

ended September 30, 2026, which is included within financing activities in the condensed consolidated statements of cash

flows.

The Company recorded equity-based compensation expense, net of forfeitures, for restricted stock units of

$100.8 million and$90.7 million for thethree months ended September 30, 2026 and 2025, respectively, with

$12.6 million and$15.9 million of corresponding deferred tax benefits, respectively. The Company recorded equity-

based compensation expense, net of forfeitures, for restricted stock units of$336.6 million and$287.1 million for the

nine months ended September 30, 2026 and 2025, respectively, with$45.7 million and$52.6 million of

corresponding deferred tax benefits, respectively. As of September 30, 2026, the total unrecognized equity-based

compensation expense related to unvested restricted stock units was$562.3 million, which is expected to be

recognized over a weighted-average term of 2.2 years.

14. Segment Reporting

Carlyle conducts its operations through three reportable segments:

Global Private Equity – The Global Private Equity segment advises buyout, growth, real estate, and

infrastructure & natural resources funds. The segment also includes the NGP Carry Funds advised by NGP.

Global Credit – The Global Credit segment advises funds and vehicles that pursue investment strategies

including insurance solutions, liquid credit, opportunistic credit, direct lending, asset-backed finance, aviation

finance, infrastructure credit, cross-platform credit products, and global capital markets.

Carlyle AlpInvest – The Carlyle AlpInvest segment advises global private equity programs that pursue

secondary purchases and financing of existing portfolios, managed co-investment programs, and primary

fund investments.

The Company’s reportable business segments are differentiated by their various investment focuses and

strategies. Overhead costs are generally allocated based on cash-based compensation and benefits expense for

each segment. The Company’s earnings from its investment in NGP are presented in the respective operating

captions within the Global Private Equity segment.

Distributable Earnings. Distributable Earnings, or “DE,” is a key performance benchmark used in the

Company’s industry and is evaluated regularly by the chief operating decision maker (“CODM”), which is our Chief

Executive Officer, in making resource deployment and compensation decisions and in assessing performance of the

Company’sthree reportable segments. The CODM also uses DE in budgeting, forecasting, and the overall

management of the Company’s segments. The CODM believes that reporting DE is helpful to understanding the

Company’s business and that investors should review the same supplemental financial measure that the CODM

uses to analyze the Company’s segment performance. DE is intended to show the amount of net realized earnings

without the effects of the consolidation of the Consolidated Funds. DE is derived from the Company’s segment

reported results and is used to assess performance.

Distributable Earnings differs from income (loss) before provision for income taxes computed in accordance

with U.S. GAAP in that it includes certain tax expenses associated with certain foreign performance revenues

(composed of performance allocations and incentive fees), and does not include unrealized performance allocations

and related compensation expense, unrealized principal investment income, equity-based compensation expense,

net income (loss) attributable to non-Carlyle interests in consolidated entities, or charges (credits) related to Carlyle

corporate actions and non-recurring items that affect period-to-period comparability and are not reflective of the

Company’s operational performance. Charges (credits) related to Carlyle corporate actions and non-recurring items

include: charges associated with the Conversion, charges (credits) associated with acquisitions, dispositions or

strategic investments, changes in the tax receivable agreement liability, amortization and any impairment charges

associated with acquired intangible assets, transaction costs associated with acquisitions and dispositions, charges

associated with earn-outs and contingent consideration including gains and losses associated with the estimated

fair value of contingent considerations issued in conjunction with acquisitions or strategic investments, impairment

charges associated with lease right-of-use assets, gains and losses from the retirement of debt, charges associated

with contract terminations and employee severance, and non-recurring items that affect period-to-period

comparability and are not reflective of the Company’s operating performance. Management believes the inclusion or

exclusion of these items provides investors with a meaningful indication of the Company’s core operating

performance.

Fee Related Earnings. Fee Related Earnings, or “FRE,” is a component of DE and is used to assess the ability

of the business to cover base compensation and operating expenses from total fee revenues. FRE adjusts DE to

exclude net realized performance revenues, realized principal investment income, and net interest (interest income

less interest expense). Fee Related Earnings includes fee related performance revenues and related compensation

expense. Fee related performance revenues represent the realized portion of performance revenues that are

measured and received on a recurring basis, are not dependent on realization events, and which have no risk of

giveback.

Asset information by segment is not disclosed because this information is not used by the CODM to make

resource deployment decisions or evaluate the performance of the Company’s segments.

The following tables present the financial data for the Company’sthree reportable segments for thethree and

nine months ended September 30, 2026:

(1)General, administrative, and other indirect expenses primarily comprised professional fees, rent and other office expenses, IT

expenses, travel and entertainment expenses, and fundraising costs.

The following tables present the financial data for the Company’sthree reportable segments for thethree and

nine months ended September 30, 2025:

(1)General, administrative, and other indirect expenses primarily comprised professional fees, rent and other office expenses, IT

expenses, travel and entertainment expenses, and fundraising costs.

The following tables reconcile the Total Segments to the Company’s Income (Loss) Before Provision for Taxes

for thethree months ended September 30, 2026 and 2025.

The following tables reconcile the Total Segments to the Company’s Income (Loss) Before Provision for Taxes

for thenine months ended September 30, 2026 and 2025.

(a)The Revenues adjustment principally represents unrealized performance revenues, unrealized principal

investment income (loss) (including Fortitude), revenues earned from the Consolidated Funds which were

eliminated in consolidation to arrive at the Company’s total revenues, adjustments for amounts attributable to

non-controlling interests in consolidated entities, adjustments related to expenses associated with the

investments in NGP Management and its affiliates that are included in operating captions or are excluded

from the segment results, and adjustments to reflect the reimbursement of certain costs incurred on behalf of

Carlyle funds on a net basis, as detailed below:

The following table reconciles the total segments fund level fee revenue to the most directly comparable U.S.

GAAP measure, the Company’s consolidated fund management fees, for thethree and nine months ended

September 30, 2026 and 2025.

(1)Adjustments represent the reclassification of NGP management fees from principal investment income,

the reclassification of fee related performance revenues from certain products, management fees

earned from Consolidated Funds which were eliminated in consolidation to arrive at the Company’s

fund management fees, and the reclassification of certain amounts included in portfolio advisory fees,

net and other in the segment results that are included in Interest and other income in the U.S. GAAP

results.

The following table reconciles the total segments transaction and portfolio advisory fees, net and other to the

most directly comparable U.S. GAAP measure, the Company’s consolidated transaction and portfolio

advisory fees, net for thethree and nine months ended September 30, 2026 and 2025.

(1)Adjustments represent the reclassification of other income from Interest and other income in the U.S.

GAAP results and certain underwriting fees from Principal investment income.

(b)The Expenses adjustment represents the elimination of intercompany expenses of the Consolidated Funds

payable to the Company, the inclusion of equity-based compensation, certain tax expenses associated with

realized performance revenues related compensation, unrealized performance revenues related

compensation, adjustments related to expenses associated with the investment in NGP Management that

are included in operating captions, adjustments to reflect the reimbursement of certain costs incurred on

behalf of Carlyle funds on a net basis, changes in the tax receivable agreement liability, and charges and

credits associated with Carlyle corporate actions and non-recurring items, as detailed below:

(c)Represents Other Income (Loss) of Consolidated Funds which are excluded from the Company’s segment

reporting.

(d)The following table is a reconciliation of Income (Loss) Before Provision for Income Taxes to Distributable

Earnings and to Fee Related Earnings:

(1)Equity-based compensation included amounts that are presented in principal investment income (loss) and

general, administrative and other expenses in the Company’s condensed consolidated statements of operations.

(2)Includes charges (credits) related to Carlyle corporate actions and non-recurring items that affect period-to-period

comparability and are not reflective of the Company’s operating performance.

(3)See reconciliation to most directly comparable U.S. GAAP measure below:

(4)Adjustments to performance revenues and principal investment income (loss) relate to (i) unrealized performance

allocations net of related compensation expense and unrealized principal investment income, which are excluded

from the segment results, (ii) amounts earned from the Consolidated Funds, which are eliminated in the U.S. GAAP

consolidation but are included in the segment results, (iii) amounts attributable to non-controlling interests in

consolidated entities, which are excluded from the segment results, (iv) the reclassification of NGP performance

revenues, which are included in principal investment income in the U.S. GAAP financial statements, (v) the

reclassification of fee related performance revenues, which are included in fund level fee revenues in the segment

results, and (vi) the reclassification of tax expenses associated with certain foreign performance revenues.

Adjustments to principal investment income (loss) also include the reclassification of earnings for the investments in

NGP Management and its affiliates to the appropriate operating captions for the segment results, and the exclusion

of charges associated with the investment in NGP Management and its affiliates from the segment results.

15. Subsequent Events

Subsequent events have been evaluated through the date the condensed consolidated financial statements

were issued. There have been no subsequent events that require recognition or disclosure through the date the

condensed consolidated financial statements were issued, except as disclosed below and elsewhere in these

condensed consolidated financial statements.

In October 2026, the Company’s Board of Directors declared a quarterly dividend of $0.35 per share of

common stock to common shareholders of record at the close of business on November 16, 2026, payable on

November 23, 2026.

16. Supplemental Financial Information

The following supplemental financial information illustrates the consolidating effects of the Consolidated Funds

on the Company’s financial position as of September 30, 2026 and December 31, 2025 and results of operations for

thethree and nine months ended September 30, 2026 and 2025. The supplemental statement of cash flows is

presented without effects of the Consolidated Funds.