Apollo Global Management Inc.

Company Overview

Business Model: Apollo Global Management, Inc. is a high-growth, global alternative asset manager and a retirement services provider. Its Asset Management segment focuses on credit and equity investing strategies, generating revenue primarily through management fees, advisory and transaction fees, investment income (including performance allocations and principal investment income), and incentive fees. The Retirement Services segment, conducted by Athene, specializes in issuing, reinsuring, and acquiring retirement savings products, generating revenue from premiums, product charges, net investment income, and investment-related gains.

Market Position: Apollo Global Management, Inc. operates with a contrarian, value-oriented investment approach in its Asset Management segment, emphasizing downside protection and capital preservation. It is willing to pursue investments in industries competitors typically avoid, employ complex structures, invest during uncertainty/distress, and undertake transactions with substantial business, regulatory or legal complexity. Athene, a leading financial services company specializing in retirement services, generates spread income by taking measured liquidity and complexity risk to achieve higher net investment earned rates. Athene's significant insurance subsidiaries are rated "A+" or "A1" by four rating agencies. The company operates in highly competitive industries, competing for investor capital, talent, and market share based on investment performance, service quality, brand recognition, and financial strength.

Recent Strategic Developments:

• On January 1, 2022, Apollo Global Management, Inc. completed its merger with Athene, making Apollo Asset Management, Inc. and Athene Holding Ltd. consolidated subsidiaries.
• The company completed a corporate recapitalization from an Up-C structure to a C-corporation.
• In March 2022, Apollo Global Management, Inc. acquired Griffin Capital’s U.S. wealth distribution business, followed by the acquisition of Griffin Capital’s U.S. asset management business in May 2022.
• The Apollo Opportunity Foundation was launched in February 2022 to invest in non-profit organizations focused on expanding opportunities for underrepresented individuals.
• On February 6, 2024, the Iowa Insurance Division identified Apollo Global Management, Inc. as an Internationally Active Insurance Group (IAIG) and Athene as the head of the IAIG.
• Subsequent to year-end, on February 23, 2025, Apollo Global Management, Inc. entered into a definitive agreement to acquire Bridge Investment Group Holdings Inc. in an all-stock transaction, expected to close in Q3 2025.

Geographic Footprint: Apollo Global Management, Inc. primarily conducts its business in the United States. Its Asset Management segment leases offices in major global financial centers including New York, Los Angeles, London, Frankfurt, Luxembourg, Mumbai, New Delhi, Singapore, Hong Kong, Shanghai, Seoul, Tokyo, and Sydney. Athene owns its headquarters in West Des Moines, Iowa, and leases its head office for Bermuda operations in Hamilton, Bermuda. In 2024, 88% of Asset Management GAAP revenues from external customers were generated in the Americas, 11% in Europe, Middle East and Africa, and 1% in Asia-Pacific.

Financial Performance

Revenue Analysis

Profitability Metrics:

• Net Margin: 17.15% (2024)
• Net Margin: 15.32% (2023)

Investment in Growth:

• Strategic Investments:
  • Acquisition of Griffin Capital’s U.S. wealth distribution business and U.S. asset management business in 2022 for $213 million in closing consideration and $64 million in contingent consideration.
  • Unfunded capital commitments of $564 million as of December 31, 2024.
  • Athene had approximately $8.8 billion in deployable capital as of December 31, 2024, generally seeking mid-teen or higher returns on capital deployment.

Business Segment Analysis

Asset Management

Financial Performance:

• Revenue: $4,176 million (+19.1% YoY)
• Fee Related Earnings (FRE): $2,063 million (+16.7% YoY)
• Total Assets Under Management (AUM): $751.0 billion (+15.4% YoY)
• Fee-Generating AUM: $568.7 billion (+15.4% YoY)
• Key Growth Drivers: Growth in fee-related revenues, including management fees (up $127 million to $1.9 billion, driven by Atlas, ADS, and S3 Equity and Hybrid Solutions, L.P.), advisory and transaction fees (up $199 million to $822 million), and investment income (up $273 million to $1,305 million, primarily from performance allocations). Net flows of $93.1 billion, including $90.4 billion in credit strategy funds and $2.6 billion in equity strategy funds.

Product Portfolio:

• Credit: $616.4 billion of AUM. Includes Direct Origination ($251.3 billion AUM), Asset-Backed Finance ($229.1 billion AUM), Opportunistic Credit ($40.3 billion AUM), and Multi-Credit ($25.2 billion AUM).
• Equity: $134.7 billion of AUM. Includes Corporate Private Equity ($76.8 billion AUM), Hybrid Value ($14.7 billion AUM), Apollo Aligned Alternatives Aggregator, LP ($19.5 billion AUM), Real Estate Equity ($16.6 billion AUM), and Infrastructure Equity ($13.6 billion AUM).
• Traditional private equity funds generated a 39% gross IRR and a 24% net IRR on a compound annual basis from inception through December 31, 2024.
• $446.5 billion of total AUM is perpetual capital.

Market Dynamics:

• Apollo Global Management, Inc. provides asset management and advisory services to Athene, managing or advising $331.5 billion of AUM (of which $325.7 billion was Fee-Generating AUM) as of December 31, 2024.
• Apollo Global Management, Inc. also provides investment advisory services to Athora, managing or advising $52.4 billion of AUM (of which $50.5 billion was Fee-Generating AUM) as of December 31, 2024.

Retirement Services

Financial Performance:

• Revenue: $21,938 million (-24.7% YoY, primarily due to a $11.4 billion decrease in premiums from pension group annuity and whole life block reinsurance transactions in 2023).
• Spread Related Earnings (SRE): $3,224 million (+3.7% YoY)
• Net Invested Assets: $248.6 billion (+14.3% YoY)
• Net Investment Spread: 1.78% (-15 bps YoY)
• Key Growth Drivers: $25.3 billion growth in Athene’s average net invested assets, higher rates on new deployment, and increased alternative net investment income. Strategic capital management fees increased $33 million due to increased ownership in ACRA 2 by ADIP II.

Product Portfolio:

• Annuities: Fixed Indexed Annuities, Fixed Rate Annuities, Registered Index-Linked Annuities, Private Placement Variable Annuities, Payout Annuities, and Group Annuities.
• Funding Agreements: Issued to institutions via direct issuances, special-purpose unaffiliated trusts (FABN, FABR programs), and the Federal Home Loan Bank.

Market Dynamics:

• Athene’s investment philosophy focuses on generating spread income by taking measured liquidity and complexity risk.
• Manages interest rate risk through ALM modeling, purchasing floating rate investments ($50.6 billion, 20% of net invested assets), and hedging activities.
• Distribution channels include Retail (through independent marketing organizations, banks, broker-dealers), Flow Reinsurance, Institutional, and Acquisitions and Block Reinsurance.
• As of December 31, 2024, Athene had approximately $8.8 billion in deployable capital.

Principal Investing

Financial Performance:

• Principal Investing Income (PII): $271 million (+226.5% YoY)
• Key Growth Drivers: Increases in realized performance fees ($179 million, primarily from Fund IX, Freedom Parent Holdings, and ANRP III) and realized investment income ($76 million, benefiting from realized gains on transfer of general partner investments to Athene).

Product Portfolio:

• Comprised of realized performance fee income and realized investment income from balance sheet investments.
• Includes growth capital and liquidity resources at Apollo Global Management, Inc. that may be deployed into strategic investments to accelerate Asset Management growth.

Capital Allocation Strategy

Shareholder Returns:

• Share Repurchases: $890 million in 2024 (7,845,000 shares). In Q4 2024, 750,336 shares were repurchased at an average price of $173.67 per share.
• Dividend Payments: $1,032 million in common stock dividends in 2024. $97 million in preferred stock dividends in 2024.
• Future Capital Return Commitments: The board of directors approved a new share repurchase program on February 8, 2024, authorizing repurchases of up to $3.0 billion of common stock. The company intends to pay an annual cash dividend of $2.04 per share of common stock.

Balance Sheet Position:

• Cash and Equivalents: $17,112 million (total cash and cash equivalents, restricted cash, and cash held at consolidated variable interest entities) as of December 31, 2024. Unrestricted cash and cash equivalents were $15.4 billion.
• Total Debt: $10,588 million (outstanding balance) as of December 31, 2024.
• Net Cash Position: $6,524 million (calculated as total cash and equivalents less total debt outstanding).
• Debt Maturity Profile: Asset Management debt maturities range from 2026 to 2054. Retirement Services debt maturities range from 2028 to 2064. Total debt obligations of $10,500 million as of December 31, 2024.

Cash Flow Generation:

• Operating Cash Flow: $3,253 million in 2024.

Operational Excellence

Production & Service Model:

• Asset Management: Provides investment management and advisory services across credit and equity strategies, employing a contrarian, value-oriented approach.
• Retirement Services (Athene): Specializes in issuing, reinsuring, and acquiring retirement savings products. Its investment philosophy focuses on generating spread income by managing liquidity and complexity risk, and it actively manages interest rate risk through asset-liability management (ALM) modeling, floating rate investments, and hedging.

Supply Chain Architecture: Key Suppliers & Partners:

• Reinsurance Partners: Athene’s U.S. insurance subsidiaries reinsure substantially all existing and new deposits to its Bermuda reinsurance subsidiaries. Key reinsurance partners include Catalina, Global Atlantic, and Protective Life Insurance Company.
• Investment Partners: Apollo/Athene Dedicated Investment Programs (ACRA), ADIP I, and ADIP II are significant investment vehicles.

Facility Network:

• Headquarters: Principal executive offices are leased at 9 West 57th Street, New York, New York. Athene owns its headquarters in West Des Moines, Iowa, and leases its Bermuda head office in Hamilton, Bermuda.
• Global Offices: Asset Management leases offices in major financial hubs across the Americas, Europe, Middle East, Africa, and Asia-Pacific, including London, Frankfurt, Luxembourg, Mumbai, Singapore, Hong Kong, Seoul, Tokyo, and Sydney.

Operational Metrics:

• Athene’s U.S. Risk-Based Capital (RBC) ratio was 419% as of December 31, 2024.
• Athene’s Bermuda RBC ratio was 450% as of December 31, 2024.
• Athene’s consolidated RBC ratio was 430% as of December 31, 2024.

Market Access & Customer Relationships

Go-to-Market Strategy: Distribution Channels:

• Asset Management: Leverages its global office network and institutional relationships to attract investor capital.
• Retirement Services (Athene): Utilizes a multi-channel distribution approach including:
  • Retail: Through 41 independent marketing organizations, 19 banks, and 151 broker-dealers, representing approximately 140,000 independent agents across all 50 U.S. states.
  • Flow Reinsurance: Ongoing reinsurance agreements.
  • Institutional: Direct issuances of funding agreements to institutions and special-purpose unaffiliated trusts (FABN, FABR programs), and to the Federal Home Loan Bank.
  • Acquisitions and Block Reinsurance: Strategic transactions to acquire or reinsure blocks of insurance business.

Customer Portfolio: Enterprise Customers:

• Strategic Partnerships: Athene and Athora are significant clients for Apollo Global Management, Inc.'s Asset Management segment, with Apollo Global Management, Inc. managing or advising $331.5 billion and $52.4 billion of AUM for Athene and Athora, respectively, as of December 31, 2024.
• Customer Concentration: Not explicitly quantified beyond the significant relationships with Athene and Athora.

Geographic Revenue Distribution:

• Americas: 88% of Asset Management GAAP revenues from external customers in 2024.
• Europe, Middle East and Africa: 11% of Asset Management GAAP revenues from external customers in 2024.
• Asia-Pacific: 1% of Asset Management GAAP revenues from external customers in 2024.

Competitive Intelligence

Market Structure & Dynamics

Industry Characteristics: Apollo Global Management, Inc. operates in highly competitive industries. The Asset Management segment competes for investor capital based on investment performance, investor perception, service quality, business reputation, and fees/expenses, as well as for attracting and retaining qualified employees. The Retirement Services segment (Athene) competes with diversified financial institutions and other insurance/reinsurance companies on factors such as initial crediting rates, product features, brand recognition, customer service, distribution capabilities, financial strength ratings, pricing, terms, reputation, service, and experience.

Competitive Positioning Matrix:

Direct Competitors

Primary Competitors:

• Asset Management: Other global alternative asset managers.
• Retirement Services (Athene): Diversified financial institutions and other insurance and reinsurance companies.

Emerging Competitive Threats:

• The company identifies artificial intelligence as a factor increasing competitive, operational, legal, and regulatory risks.
• General risks include new entrants, disruptive technologies, and alternative solutions.

Competitive Response Strategy:

• Apollo Global Management, Inc. aims to expand into new investment strategies, geographic markets, and businesses, and to increase the number and type of products offered to individual investors.
• The company focuses on professional development, fostering an entrepreneurial culture, and utilizing pay-for-performance compensation and equity-based programs to attract and retain talent.
• It integrates financially material environmental, social, and/or governance considerations into its investment, lending, and firm operations.

Risk Assessment Framework

Strategic & Market Risks

Market Dynamics:

• Economic Conditions: Exposure to difficult political, market, or economic conditions, which can lead to variability in revenues, earnings, and cash flow. The U.S. inflation rate was 2.9% as of December 31, 2024, and the U.S. Federal Reserve benchmark interest rate target range was 4.25% to 4.50%.
• Climate Change: Risks include transition and physical risks, potential impacts on asset prices, increased insurance costs, and decreased real estate values.
• Technology Disruption: Artificial intelligence is noted as increasing competitive, operational, legal, and regulatory risks.

Operational & Execution Risks

Supply Chain Vulnerabilities:

• Illiquid Assets: As of December 31, 2024, approximately 60% of the value of the funds’ investments was determined using comparable company/industry multiples or discounted cash flow models, indicating reliance on less liquid valuation methods.
• Key Personnel Dependency: The business is dependent on certain key personnel, and misconduct by employees, directors, or affiliates poses a risk.
• Technology Reliance: Significant reliance on technology and information systems, which introduces operational risks.

Financial & Regulatory Risks

Market & Financial Risks:

• Foreign Exchange: A 10% decline in foreign currencies against the U.S. dollar would decrease management fees by approximately $29 million and investment income (loss) by $3 million in 2024.
• Liquidity Risk (Athene): Athene estimates approximately $8.8 billion in deployable capital as of December 31, 2024, consisting of excess equity capital, untapped leverage capacity, and available undrawn capital at ACRA.
• Individual Investor Products (Athene): Approximately 26% of Athene’s deferred annuity account value contained rider benefits, and the weighted average surrender charge for deferred annuities was 6% as of December 31, 2024.

Regulatory & Compliance Risks:

• Extensive Regulation: Subject to extensive global regulation by numerous authorities including the Investment Advisers Act, Investment Company Act, Dodd-Frank Act, Commodity Exchange Act, U.K. Financial Services and Markets Act 2000, EU/U.K. Alternative Investment Fund Managers Directive, FSOC, Federal Reserve, SEC, FINRA, CFTC, NFA, U.S. Department of Labor, IRS, OCC, FCC, and various international banking and financial regulators.
• Taxation: The tax treatment of the company's structure is complex and subject to change, including new minimum tax regimes such as the U.S. Base Erosion and Anti-Abuse Tax (BEAT), the Bermuda Corporate Income Tax Act 2023 (15% effective January 1, 2025), and the U.S. Inflation Reduction Act of 2022 (15% minimum corporate income tax and excise tax on stock repurchases).
• Litigation: Exposure to third-party litigation, including putative class actions, shareholder derivative complaints, and regulatory investigations. An SEC investigation regarding record retention was settled in January 2025 with an $8.5 million civil monetary penalty.

Geopolitical & External Risks

Geopolitical Exposure:

• Geographic Dependencies: The company has reported insignificant direct exposure of its investment portfolios to Russia, Ukraine, or the Middle East to date.
• Pandemics: Risks include adverse impacts on valuations, increased volatility, supply chain disruptions, and increased policyholder withdrawals.

Innovation & Technology Leadership

Research & Development Focus: Core Technology Areas:

• While not explicitly detailed as a separate R&D function, the company acknowledges its reliance on technology and information systems as a risk factor.
• Artificial intelligence is identified as a technology that is increasing competitive, operational, legal, and regulatory risks, suggesting an awareness of its evolving role.

Intellectual Property Portfolio:

• No specific details on patent strategy, licensing programs, or IP litigation were provided in the filing.

Technology Partnerships:

• No specific technology partnerships were explicitly detailed in the filing.

Leadership & Governance

Executive Leadership Team

Leadership Continuity:

• The company's success is instrumental on its talent. Equity-based compensation programs, including one-time grants to Co-Presidents of Apollo Asset Management, Inc., are used to incentivize leadership.

Board Composition:

• The board of directors includes an Independent Chair, Walter (Jay) Clayton, and a diverse group of directors including Marc Beilinson, Jessica Bibliowicz, Michael Ducey, Kerry Murphy Healey, Mitra Hormozi, Pamela Joyner, AB Krongard, Pauline Richards, David Simon, Lynn Swann, and Patrick Toomey.
• The board oversees the company’s cybersecurity risk management program and reviews corporate responsibility and sustainability matters through a dedicated committee.

Human Capital Strategy

Workforce Composition:

• Total Employees: 5,108 as of December 31, 2024, including 1,983 employees of Athene.
• Geographic Distribution: Employees are distributed across the company's global office footprint.

Talent Management: Acquisition & Retention:

• Hiring Strategy: Focuses on professional development and fostering an entrepreneurial culture.
• Employee Value Proposition: Employs a pay-for-performance compensation philosophy, with all employees granted stock through equity-based programs, such as the One Apollo stock program.

Diversity & Development:

• Development Programs: Emphasizes professional development.
• Culture & Engagement: Fosters an entrepreneurial culture and uses annual employee surveys to gauge engagement.
• The Apollo Opportunity Foundation, launched in February 2022, invests in non-profit organizations to expand opportunities for underrepresented individuals in career education, workforce development, and economic empowerment.

Environmental & Social Impact

Environmental Commitments: Climate Strategy:

• Climate change-related risks, including transition and physical risks, are identified as principal risks. The company integrates financially material environmental considerations into its investment, lending, and firm operations.

Supply Chain Sustainability:

• The company has a supplier code of conduct.

Social Impact Initiatives:

• Community Investment: The Apollo Opportunity Foundation invests in non-profit organizations to expand opportunity for underrepresented individuals in career education, workforce development, and economic empowerment.
• Human Rights: The company has a human rights policy.
• Reporting: An annual sustainability report is published.

Business Cyclicality & Seasonality

Demand Patterns:

• Economic Sensitivity: The company's revenues, earnings, and cash flow are subject to variability due to difficult political, market, or economic conditions.
• Industry Cycles: Not explicitly detailed in the filing.

Planning & Forecasting:

• No specific details on demand forecasting approach, inventory management, or capacity planning were provided in the filing.

Regulatory Environment & Compliance

Regulatory Framework: Industry-Specific Regulations:

• Investment Management: Apollo Global Management, Inc. is subject to extensive regulation globally, including by the Investment Advisers Act, Investment Company Act, Dodd-Frank Act, Commodity Exchange Act, U.K. Financial Services and Markets Act 2000, EU/U.K. Alternative Investment Fund Managers Directive, EU/U.K. Markets in Financial Instruments Directive, FSOC, Federal Reserve, SEC, FINRA, CFTC, NFA, U.S. Department of Labor, IRS, OCC, and FCC.
• Insurance Regulation: Athene, Athora, and Catalina are regulated by the Bermuda Monetary Authority (BMA). The Iowa Insurance Division (IID) identified Apollo Global Management, Inc. as an Internationally Active Insurance Group (IAIG) and Athene as the head of the IAIG. State guaranty fund laws require member insurers to participate in guaranty associations.

Trade & Export Controls:

• No specific details on export restrictions or sanctions compliance were provided in the filing, beyond general risk factors.

Legal Proceedings:

• The company is involved in various legal proceedings, including putative class actions, shareholder derivative complaints, and regulatory investigations. A notable settlement in January 2025 involved an $8.5 million civil monetary penalty related to an SEC investigation into record retention.
• Guaranty association expenses related to the Bankers Life Insurance Company and Colorado Bankers Life Insurance Company insolvencies amounted to $152 million in 2024.

Tax Strategy & Considerations

Tax Profile:

• Effective Tax Rate: 14.3% in 2024, compared to (16.5)% in 2023. The change was primarily related to increased pretax income subject to income tax and a one-time deferred tax benefit from the Bermuda Corporate Income Tax Act 2023 enactment in Q4 2023.
• Geographic Tax Planning: Athene Holding Ltd. changed its domicile from Bermuda to the U.S., effective December 31, 2023, becoming a U.S. taxpayer for 2024 and future years. Bermuda enacted a 15% corporate income tax (Bermuda CIT) commencing January 1, 2025.
• Tax Reform Impact: The company is subject to the U.S. Base Erosion and Anti-Abuse Tax (BEAT) (10% before 2026, 12.5% thereafter) and the U.S. Inflation Reduction Act of 2022 (including a 15% minimum corporate income tax and an excise tax on stock repurchases).

Insurance & Risk Transfer

Risk Management Framework:

• Insurance Coverage: No specific details on insurance coverage types or limits were provided.
• Risk Transfer Mechanisms: Athene utilizes derivatives to manage various risks, including interest rate, equity, and foreign currency exposures. Reinsurance is a key risk transfer mechanism for Athene, with substantially all existing and new deposits of its U.S. insurance subsidiaries reinsured to its Bermuda reinsurance subsidiaries, typically through 80% to 100% quota shares.