Brookfield Asset Management Ltd.

Operator: Good day, and thank you for standing by. Welcome to the Brookfield Asset Management Ltd. First Quarter 2026 Earnings Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today’s conference is being recorded. I would now like to hand the conference over to Jason Fooks, Managing Director, Investor Relations. Please go ahead. Jason Fooks: Thank you for joining us today for Brookfield Asset Management Ltd.’s first quarter 2026 earnings call. On the call today, we have Connor Teskey, our Chief Executive Officer; Armen Panossian, Co-CEO of Credit; and Hadley Peer Marshall, our Chief Financial Officer. Before we begin, I would like to remind you that in today’s comments, including in responding to questions and in discussing new initiatives, we may make forward-looking statements. Future events and results may differ materially from such statements. For further information on these risks and their potential impacts on our company, please see our filings with the securities regulators in the U.S. and Canada, and the information available on our website. On the call today, Connor will begin with an overview of the quarter and highlight the strategic momentum across our business. We are also pleased to have Armen join us to provide an update on the Oaktree integration and share his perspective on how our combined platform is positioned to be opportunistic in today’s market. And finally, Hadley will discuss our financial and operating results and balance sheet. After our formal remarks, we will open the line for questions. To ensure we can hear from as many participants as possible, we are asking everyone to please limit themselves to one question. If you have additional questions, please rejoin the queue, and we will be happy to take more questions if time permits. With that, I will turn the call over to Connor. Connor Teskey: Thank you, Jason. Good morning to everyone on the call. 2026 will not only be a record year for Brookfield Asset Management Ltd., but one where we expect to exceed our long-term growth targets, and we are already off to a great start with a strong first quarter. Fee-related earnings for the quarter were up 11% to $772 million and distributable earnings were $702 million. We raised $21 billion of capital this quarter and fee-bearing capital increased 12% over the last twelve months to $614 billion, including the fundraising we have announced associated with the Just Group mandate and our flagship private equity fund. Year-to-date fundraising stands at $67 billion, more than half of the $112 billion we raised in all of 2025. More important than the numbers is what they reflect: the continued strength of our franchise, the quality of our client relationships, and the increasing importance of the areas where we invest. We are operating from a position of strength with scale, liquidity, and a portfolio centered on essential assets and businesses that form the backbone of the global economy. This year is being supported by a number of important strategic developments across the broader platform. In early April, Brookfield Wealth Solutions completed its purchase of Just Group, a leading pension risk transfer platform in the U.K., and through that, Brookfield Asset Management Ltd. was awarded an additional $40 billion asset management mandate, further extending our presence in retirement and insurance-related capital. We are also very close to completing our acquisition of Oaktree, which we expect to close in the second quarter, and which will further strengthen and integrate our global credit franchise. In a few minutes, Hadley will speak more specifically to the financial impact of both those transactions. At the same time, this year, we have one of the broadest product sets in the market. This includes our flagship private equity strategy, which has already closed $6 billion and will be holding its first close in the coming months. It also includes our flagship infrastructure fund—in fact, all of our infrastructure funds—alongside a growing number of complementary strategies. We are also seeing excellent momentum across our partner managers, where each of Primary Wave, 17Capital, and Pine Grove recently held fund closes that not only exceeded their targets, but in all three cases represented the largest fund of their kind. That breadth is driving strong fundraising momentum and setting us up well for the balance of the year. Against this backdrop, we continue to expect 2026 to be Brookfield Asset Management Ltd.’s largest fundraising year ever. One of the clearest ways our platform is evolving is in how we engage with our largest clients. For some time, we have said that investors are consolidating more of their business with fewer managers, particularly with firms that can invest at scale across asset classes, geographies, and products, up and down the capital structure. Our partners are not only asking us for a view on one sector or one fund, but rather they are asking what we are seeing across the $1.2 trillion of assets in our ecosystem, how capital is moving across markets, and how those linkages are shaping investment opportunities. More and more, those conversations are leading to broader strategic relationships where we start with the client’s objectives—across income, appreciation, duration, diversification, and liquidity—and then build customized solutions across our strategies to help meet those goals. We are seeing tangible momentum for multibillion-dollar partnerships across multiple strategies, and we are investing behind it through our Investment Solutions Group, a dedicated team focused on delivering those insights and tailored solutions at greater scale. While this capability has long been a differentiator for our business, its importance has become more acute in recent years, and we expect it to be a key competitive advantage as alternatives continue to expand into retirement, insurance, and individual markets. In the near term, geopolitical uncertainty remains elevated. Trade and energy markets continue to adjust, and investors are assessing what that means for growth, inflation, and rates, while also considering how quickly AI may disrupt certain business models. Those issues matter, and they can move sentiment and market prices in the short run. But our view is that those movements are temporary and manageable, while the long-term trends we invest behind remain firmly in favor and continue to accelerate. Our job is to own good businesses, operate them well, protect downside, and compound cash flows over time. That discipline has served us well through many cycles, and today we are seeing it in the continued performance of our assets, and we believe that this period will be no different. It is also worth reiterating something we have said before. We are fortunate to have outsized exposure to the largest and most attractive segments of the alternatives market, and limited exposure to the areas where investor concern is currently the most concentrated. We have very limited exposure to software across our strategies. Sponsor-oriented direct lending is an immaterial part of our business. And our listed private wealth credit vehicles are disproportionately small, with our private BDC representing less than 1% of fee-bearing capital. But we would caution against viewing our position as simply defensive. Limited downside does not fully capture where we sit today. In our view, we are not only protected from many of the areas under pressure, we are positively exposed to the areas that should outperform in this environment. The first reason is that in this environment, real assets win. When there is uncertainty around growth, rates, or the durability of earnings, investors move toward high-quality, cash-generative assets and essential service businesses. That is exactly where we are concentrated. In real estate, we are clearly seeing the recovery accelerate. Sentiment is improving, financing markets are materially stronger, new supply remains muted in many sectors, and in a number of cases, assets can still be acquired well below replacement cost. In private equity, our strategy has always been focused on essential industrial and service businesses, where value creation comes from operations, not financial engineering. That approach is particularly well suited to the current market. And lastly, infrastructure, where digitalization, rising energy demand, and deglobalization are all creating sustained demand for capital—we continue to see exceptional client interest and a very large opportunity set. The second reason is that concerns regarding AI disruption are equally balanced by accelerating AI adoption. That is not a headwind for Brookfield Asset Management Ltd.; it is a very significant tailwind. AI requires enormous physical infrastructure: data centers, power generation, transmission, fiber, computing, cooling systems, and industrial capacity across the supply chain. We are already deeply invested across those areas. We have leadership positions in data centers and renewable power. We can combine real estate, infrastructure, and energy into integrated solutions at scale. And increasingly that is exactly what the largest hyperscalers, governments, and enterprise customers are looking for. This is also why all of our infrastructure, energy, and AI infrastructure strategies are seeing such significant interest. As AI adoption accelerates, Brookfield Asset Management Ltd.’s market-leading position in a very large portion of our assets becomes increasingly valuable. The third reason is credit. If current concerns in select pockets of credit persist, or the natural credit cycle continues to turn, that is precisely the type of environment where our platform should be at its best. We have been disciplined in how we built our credit business. We have always preferred areas where underwriting matters, where structure matters, and where there is real downside protection—notably real asset credit, asset-backed finance, and opportunistic credit. And lastly, we could not be more thrilled with the timing of our integration with Oaktree. Through the combined Brookfield Asset Management Ltd. and Oaktree platform, we have what we believe is the preeminent opportunistic credit franchise in the world. When liquidity becomes scarce and capital is repriced, that is when disciplined investors with flexible capital and deep experience have historically generated some of their best returns. I will turn the call over to Armen in a moment, who will speak more specifically about the current credit environment and how Oaktree is seeing the opportunity set today. In conclusion, our message is simple. We are entering this period with strong results, significant strategic momentum, limited exposure to the areas causing the most concern, and meaningful exposure to where capital should continue to flow. We are positioned not just to navigate this backdrop, but to outperform through it. Armen? Armen Panossian: Thank you, Connor. It is a pleasure to join you at such an exciting and dynamic time at the firm, taking on the role of Co-CEO of Brookfield’s Credit Business. The integration of Oaktree and Brookfield will meaningfully strengthen our already differentiated platform, allowing us to bring more of the combined firm’s capabilities to clients across asset classes and up and down the capital structure. Over the past six years, this partnership has already proven itself, and our cultures and investing principles are already well aligned. We share a long-term vision, a deep respect for disciplined capital allocation, and a focus on building client relationships over years and cycles, not quarters. But there have also been natural limitations to how much we could do as two separate companies. Bringing the platforms together eliminates those barriers and creates immediate benefits: simplification, better alignment, and broader access to the combined capabilities of our firms. While this combination creates clear operating and financial benefits, its greatest significance and most meaningful impact will be on the strategic side. As an example, clients increasingly want broader solutions—whether that means flagship strategies, complementary strategies, customized multi-asset portfolios, or co-investment opportunities delivered at scale. Our combined platform positions us to meet that demand more effectively, to serve clients more comprehensively, and to compete for larger and more complex opportunities than either firm could do on its own. And that matters especially in the market we are in today. Over the past five years, credit markets have undergone an extraordinary transformation. As economies reopened in 2021 and governments injected significant stimulus, inflation surged, prompting one of the most aggressive rate-hiking cycles in modern history. Short-term rates moved from near zero to over 5%, fundamentally reshaping capital markets. That shift created a meaningful dislocation and subsequently immense investment opportunity. Traditional bank lending and broadly syndicated markets pulled back, particularly for middle-market borrowers, and private credit stepped in to fill the gap, offering capital at initially wider spreads, which helped drive very attractive returns—often in the 10% to 12% range. Those returns attracted capital, fundraising accelerated, competition increased, and spreads compressed back towards pre-pandemic levels. In response, parts of the market leaned into higher leverage, looser covenants, non-cash-pay interest loans or PIK structures, and greater exposure to certain sectors like software to gain higher returns. Today, we are entering a new phase. Recent headlines have raised legitimate concerns around certain parts of private credit: rising impairments, questions over valuations, the use of leverage, liquidity mismatches, refinancing risk, and software exposure in an increasingly AI-driven world. It is important to separate the fundamentals of private credit from the excesses in select parts of direct lending. Private credit itself—tailored, nonbank financing—is a proven model in which Oaktree has been actively involved for over three decades. It works, providing capital to help businesses grow and delivering fair and attractive returns across the cycle. The issue is that in a period of abundant capital and low rates, underwriting standards in the market become looser. Risk tends to build in strong markets and only becomes visible as conditions turn and become more stressed. What we are seeing now is less a systemic issue and more a period of recalibration. Taken together, today’s environment is characterized by tighter spread, higher leverage in certain segments, and increasing dispersion in credit quality. That creates both risk and opportunity, and it is exactly the kind of environment in which we thrive. Both Oaktree and Brookfield have a long history of investing through cycles. Our approach has always been grounded in discipline, patience, and a willingness to prioritize risk management and long-term value over short-term growth. We did not maximize deployment during the recent years of heightened competition. Instead, we maintained conservative leverage in our funds and remained selective in underwriting, even when that meant sacrificing near-term growth. As a result, we entered this period with a resilient platform, ample dry powder, and the flexibility to act as opportunities emerge. And that flexibility matters today. Because as rates come off their peak and spread becomes a larger driver of returns, credit selection matters more than ever. We are already seeing greater differentiation across vintages, sectors, and structures, and the winners will continue to differentiate themselves as time progresses. We do not view private credit in isolation. We constantly compare relative value across performing credit, liquid markets, asset-backed finance, and opportunistic strategies. When we see early signs of stress in one area, it informs how we position elsewhere, both defensively and offensively. That perspective is even more valuable in collaboration with the Brookfield ecosystem. Together, we will have a fully integrated information network across credit and equity teams, industries and geographies, and public and private markets. We are already tracking dozens of emerging opportunities in real time, sharing notes across teams, and identifying dislocations earlier through direct exposure to underlying businesses, assets, and capital structures. Brookfield’s strength as an owner-operator combined with Oaktree’s leadership in credit creates a differentiated platform for sourcing and executing complex capital solutions. While today’s market presents real risks, it is also creating exactly the kind of environment where our experience, discipline, and scale can drive meaningful outperformance. Thank you for having me on today’s call. With that, I will pass it over to Hadley. Hadley Peer Marshall: Thank you, Armen. I will cover our quarterly results, capital positioning, and why we are on track to deliver a record 2026. Fee-related earnings, or FRE, in the first quarter were up 11% from the prior-year period to $772 million, or $0.48 per share. Over the last twelve months, FRE has grown to $3.1 billion, up 18% from the prior-year period. Distributable earnings, or DE, were $702 million, or $0.43 per share in the quarter, up 7% from the prior-year period, bringing DE over the last twelve months to $2.7 billion. Growth in DE continues to closely track growth in FRE, reflecting the high-quality, recurring, and stable nature of our revenue base. Turning to margins, we have maintained strong levels alongside this growth, with margins at 57% for the quarter and 58% over the last twelve months. As previously discussed, once the Oaktree acquisition closes—likely in the second quarter—we will report a consolidated margin that includes 100% of Oaktree. We will also provide more transparency in our partner managers, which will impact the presentation of our margin but will not reflect any change in the underlying economics of the business. Importantly, while our partner managers operate at lower margins, they are highly accretive and strategically beneficial to our platform. As Connor mentioned, they are also expected to be meaningful growth contributors to Brookfield Asset Management Ltd. As they continue to scale, we will benefit from their inherent operating leverage, further expanding their margins as well as our consolidated margin. Before turning to fundraising, I want to touch on share repurchases. Historically, share repurchases have not been a primary use of capital as we have had compelling opportunities to invest in the growth of the business, including acquiring partner managers’ interests and seeding complementary strategies. However, given recent public market volatility, we believe our shares are meaningfully undervalued, so we have been more active in repurchases. In the first quarter, we opportunistically repurchased $375 million of stock and have so far repurchased an additional $200 million in the second quarter. This brings our total buyback activity over the past seven months to nearly $800 million. We also remain committed to our objective of broader index inclusion. The continued growth and scale of our U.S. business, including the acquisition of Angel Oak and our increased ownership of Oaktree, further support our path toward broader U.S. equity index eligibility over time. Now let me turn to the details of the $21 billion we raised in the quarter, which was driven by our complementary strategies and insurance inflows. Within our infrastructure business, we raised $3.4 billion, including $800 million for our super-core infrastructure strategy, which now has over $20 billion of capital, and $800 million for our infrastructure private wealth strategy, which now has over $8 billion of capital. Within our private equity business, we raised $1.4 billion, including $1 billion for our private equity special situations strategy, which held its first close of $2.4 billion. Within our credit business, we continue to see broad-based demand. We raised $13 billion of capital, including $4.7 billion of long-term private funds and $3.8 billion from Brookfield Wealth Solutions. 17Capital completed the final close of Credit Fund II, adding $2.5 billion in the quarter and bringing the strategy to $7.5 billion, the largest NAV lending strategy raised to date. Our fundraising benefits from strong performance and our disciplined approach focused on fundamentals and risk-adjusted returns. That approach has led both Brookfield and Oaktree, independently, to limit exposure to areas such as direct lending and software where we saw less compelling risk-adjusted opportunities. This discipline has reinforced our clients’ confidence in our capabilities and continues to support fundraising. Fundraising is also well diversified geographically. We continue to see strong traction around our high-conviction strategies, and the trend we have previously discussed—large clients concentrating commitments with fewer strategic managers that can offer a broad range of strategies at scale—appears to have become even more pronounced. These drivers, together with our flagship fundraising and the recently awarded Just Group investment mandate, position us well for a record year of fundraising. Turning to deployment and monetization, we invested or committed $34 billion and generated approximately $8 billion of equity proceeds from monetizations. Based on our deep pipeline, we expect activity to further build as the year progresses. Overall, M&A has picked up, particularly in larger strategic transactions where buyers are moving with greater conviction. Despite pockets of uncertainty, both corporates and sponsors are increasingly willing to transact. In many cases, that uncertainty is driving activity rather than constraining it, as companies are using stronger access to capital to reposition portfolios in response to structural shifts including AI, geopolitics, and evolving supply chains. At the same time, sponsors are seeking to return capital, which is contributing to increased deal supply. While a normalized rate environment requires discipline on valuations and greater operating expertise to drive returns, we are seeing markets adjust to this environment. This creates opportunities for us. Our focus on high-quality real assets and essential services businesses aligns where demand is strongest, particularly where durability and cash flow visibility are at a premium. In addition, our scale, global platform, operating capabilities, and access to capital position us to be both an active acquirer and a disciplined seller in today’s environment. As M&A activity broadens, we expect to benefit from both increased deployment opportunities and an improving backdrop for monetizations. Turning to our balance sheet, we continue to operate with a strong, asset-light financial profile that provides flexibility to support growth while maintaining healthy liquidity. Subsequent to quarter-end, we took advantage of an opening in the market and issued $1 billion of senior unsecured notes, comprised of $550 million of five-year notes at a coupon of 4.832% and $450 million of ten-year notes at a coupon of 5.298%. We ended the quarter with $2.5 billion of corporate liquidity, providing ample flexibility to support ongoing operations, strategic initiatives, and growth across the business. We are off to a great start in 2026 and remain well positioned for a record year. While markets remain uncertain, our scale and expertise position us to navigate the environment and execute effectively. With that, let us open up the line for questions. Operator: We will now open the call for questions. To ask a question, please press star 11. To withdraw your question, please press star 11 again. Our first question comes from Kenneth Worthington with JPMorgan. Kenneth Worthington: Hi, good morning, and thanks for taking the question. Armen, thanks so much for your comments. I wanted to dig further into Oaktree and the distressed market. I think, as you stated, we have been in a very strong credit environment for an extended period. How much money does Oaktree have to invest, and how much could Oaktree reasonably deploy if a distressed window opens briefly, or for a more extended period? And what does that mean for Brookfield Asset Management Ltd.’s credit business? And then, Connor, you mentioned that partner manager companies have raised their largest vintages ever. Can you quantify how Brookfield Asset Management Ltd.’s acquisitions of these businesses are impacting that fundraising and to what extent strong fundraising has been influenced by Brookfield Asset Management Ltd.’s bigger sales force and broader client relationships? Armen Panossian: Thanks, Kenneth. I appreciate the question. Oaktree does have funds under management and relationships with LPs that are considerable. I want to hesitate to answer questions specifically about fundraising, but we have a lot of dry powder to invest into the market currently and have a long-term track record of really leaning into the markets when distressed opportunities present themselves. Today, we do not see a broad-based macro condition that would result in meaningfully higher deployment patterns than what we have seen over the last five years, but we always see sector-specific distress. Today, we see distress in software, building products, chemicals, autos, and packaging. That sector-specific distress, I would say, gives a more normal pattern of vintage years. It numbers in the billions, but it does not number in the tens of billions with our kind of risk-control way of investing. Now, if we do see a dislocation, our deployment capabilities measured in a 12- to 24-month period would be in the tens of billions. We have done that in the past. We are prepared to do that in the future. We are right now watching what is unfolding in a variety of respects globally. We are looking at inflation caused by energy prices. We are looking at the software industry. We have a target list of credits that we are watching closely and willing to buy at the right prices. We are constantly boiling the ocean and looking for the opportunities. We do not think at this moment it is the time to really lean hard, but we are seeing the beginnings of a real opportunity set developing. A part of that has to do with the maturities that we see in a lot of LBOs—some software, some outside of software—really coming to play in 2027 and 2028. So we are getting ready for a big opportunity. It is probably not measured in the immediate quarters to come, but in the next couple of years, we would expect to deploy a considerable amount of capital. Connor Teskey: Thanks, Ken. There is no doubt, whenever we acquire a partner manager, we specifically pick market leaders in a given sector where we think we can accelerate the growth profile of that business as part of the Brookfield Asset Management Ltd. platform. We are really beginning to see that play out. We had three partner managers raise new funds this year that were not only the biggest of their kind, but the biggest in their industry. Partner managers are increasingly driving earnings growth across the consolidated business. Operator: Our next question comes from Cherilyn Radbourne with TD Cowen. Cherilyn Radbourne: Thanks very much, and good morning. I was hoping that you could touch on a few aspects of AI: how fundraising is going for your fund; in what respects you think you are differentiated versus peers; and, more strategically, how you manage the balancing act of leaning in enough to AI without getting over-allocated to it? Connor Teskey: Thanks, Cherilyn. AI—which for Brookfield Asset Management Ltd. really means a focus on AI infrastructure—is undoubtedly the largest and fastest-growing theme across our broader business. This is derived from the fact that we have always been a leader in the historical inputs into AI—real estate, energy, and digital infrastructure—but we have also recently expanded into leadership positions in the new forms of AI infrastructure, sovereign AI, and actually selling the compute itself. To your questions around growth and what we are seeing, maybe to point to something tangible—and it is very representative of what we are seeing in the market—is the first deal we did in our AI Infrastructure Fund was our partnership with Bloom Energy. That was announced, I want to say, six or nine months ago, a $5 billion partnership. We are already in conversations to expand that partnership not by percentages, but by multiples. That is very reflective of the opportunity set and the scale at which we expect to play. On remaining balanced, it is important to recognize that while there is a significant amount of capital flowing into the sector, the investment opportunity set is incredibly vast. As a result, we can be incredibly selective. We can focus on the best assets and the best markets with the best revenue constructs and the best corporate credit counterparties. Even being that selective, we can still deploy very significant sums of capital. We do see all the activity, but in terms of some of the risk-adjusted returns that we are actually executing on, they are certainly some of the most attractive opportunities we are seeing in the market. Operator: Our next question comes from Alexander Blostein with Goldman Sachs. Alexander Blostein: Hi, good morning everybody. Was hoping we can start with a question on the broader outlook for the rest of the year. Clearly, the business is facing a number of structural tailwinds—you mentioned energy, AI, many other things—so it is encouraging to hear you reaffirm expectations to exceed your Investor Day goals for 2026. A couple of questions here. First, just a point of clarification: are we talking fee-related earnings per share for 2026 up off the 2025 base? And then more importantly, how has the fundraising backdrop evolved in the last three to four months given the changes in the landscape to build on that momentum? What is feeling better, what is feeling worse, and what is feeling the same? Connor Teskey: Thank you for the question, Alex. You are absolutely right. We have an incredibly positive outlook for 2026. We expect it to be a record year for fundraising—not by a little bit. We expect it to be a significant record year for fundraising. In response to your question, outperformance will be largely on the FRE side, and that outperformance for the remainder of the year feels largely secured, other than the limited market exposure we have through our listed affiliates. That is driven by run-rating of strong performance through the end of last year, very strong growth in our partner managers, and then some big step-change revenue adders that start this year and will, candidly, carry into next year as well: our flagship PE fund, our flagship infrastructure fund, the Just Group mandate, and the Oaktree acquisition. In terms of the big things that will drive that FRE growth, it is exactly those. We expect to see incredibly strong demand for our two flagships. PE is off to a great start; we expect that to be the largest vintage of its kind. We are in a very fortunate position that we have all of our funds in the market right now at a time when we are in the greatest infrastructure capital deployment environment in history. Those are the biggest drivers. We are seeing growth across everything on the infrastructure and energy side, and then outperformance relative to past precedent on the private equity side. Operator: Our next question comes from Bart Dziarski with RBC Capital Markets. Bart Dziarski: Great, thanks for taking the question and good morning everyone. Wanted to ask around capital allocation. Nice to see you stepping in on the buyback to take advantage of dislocation. How are you thinking about buybacks going forward? And related to that, you issued debt in the quarter—the commercial paper program and the senior notes. Maybe just an update in terms of your funded position and, more broadly, philosophically how you think about the buyback and issuing more debt? Hadley Peer Marshall: Thanks for the question. When we think about our options, obviously, when it comes to liquidity, we have a lot of attractive opportunities within Brookfield Asset Management Ltd.—around our partner managers and seeding our complementary strategies—and so we are always assessing those attractive opportunities to grow our business. When we see irrationally undervalued stock prices associated with Brookfield Asset Management Ltd., that is an opportunistic time for us to take our under-levered position as an asset manager and use that capital to generate attractive returns for us. That is something that we do opportunistically. We have been active starting in the fourth quarter up until now, and that is about $800 million of buybacks that we have executed. In terms of our liquidity, we accessed the bond market earlier this year—back in April—when we saw an opening in the market that was quite constructive to add liquidity. We issued $1 billion with strong execution. That puts us in a position where we have $2 billion-plus of excess debt capacity. Remember that as our DE grows, our debt capacity grows as well. That positions us to continue to be opportunistic with the opportunities that we see within Brookfield Asset Management Ltd. holistically, as well as continuing to support buying our partner managers’ remaining stakes and our complementary strategies. Operator: Our next question comes from Sohrab Movahedi with BMO Capital Markets. Sohrab Movahedi: Thank you. Connor, you highlighted a bunch of issues that have been hurting the sector, one of which was retail redemptions. In the past, you have highlighted the importance of retail both from a fundraising perspective and individual participation and probably a big, important source of growth for you on the funding side. As you have been watching what has been happening—you are always methodical and disciplined—are you rethinking your retail ambitions based on what we have seen more recently? To the extent you are not rethinking those ambitions, is this one of those cases where the second mouse gets the cheese—an opportunity where you get to run in as folks are running out? And maybe, like the Oaktree acquisition that you had done has aged well, an opportunity may present itself. How willing would you be to expedite those retail plans? Hadley Peer Marshall: Thank you for the question. Connor Teskey: In terms of what we are seeing and what that leads to in terms of our approach going forward, we are very proud of how we have built the private wealth, retail, and individual market, and we think our approach is paying dividends now and the market is coming to us. Private wealth is a smaller portion of our business relative to some of our peers as we have been very methodical and thoughtful in how we built that business for the long term. Our private wealth business grew versus this point last year. Despite concerns in private wealth credit, we continue to see tremendous inflows to our private wealth products on the real asset side. This continues to be a more modest part of our business today, but one that is growing very quickly—it has been growing at about 40% for the last couple of years—and we expect that growth to continue, particularly as investors in that market continue to pivot increasingly toward real assets. I would also mention the individual retirement market. We think our growth and penetration of the individual market is perhaps accelerating faster than people appreciate. On the 401(k) and retiree market side, we are in advanced discussions with some of the largest target-date fund providers who are interested in putting Brookfield Asset Management Ltd.’s real asset products into some of their default portfolios. They are recognizing the role that long-duration, inflation-linked, cash-generative, downside-protected investments can play. We are also the market leader in introducing real asset exposure into insurance policy and annuity portfolios through our partnership with Brookfield Wealth Solutions. Our approach is working. It plays very well in this market. We are going to continue to lean in, but it is more of the same as opposed to a major shift in strategy. Operator: Our next question comes from Brian Bedell with Deutsche Bank. Brian Bedell: Great, thanks. Good morning. Thanks for taking my question. Maybe just shift to the topic of energy transition. You are a leader in that space, and the energy platform broadly has been rebranded from the renewables side. Does that change any of your marketing within those products? How do you link energy and infrastructure—many of those themes are similar, and I would imagine the LP investor base has similar ambitions. How do you sell those products as a solution to LP investors? And then your view on the demand for energy transition given the power needs for AI and the disruption of supply chains amid the geopolitical backdrop. Connor Teskey: I will address that in reverse order. The demand for energy is at an unprecedented high and will continue to be at an unprecedented high throughout the end of this decade and well into the next one, and perhaps beyond. This is going to require—pick your slogan—an “all of the above” type of energy solution, and we are fortunate to be a leading player across all of them. The big ones are obviously going to be low-cost renewables, flexible gas, and dependable nuclear. Where we [inaudible]. It changed nothing in terms of our allocation strategies and [inaudible]. On linking energy and infrastructure for clients, increasingly we are packaging solutions—power plus data center plus grid upgrades, for example—and delivering them through our flagship strategies and tailored mandates, so clients can access integrated outcomes rather than isolated products. Operator: Our next question comes from Daniel Fannon with Jefferies. Daniel Fannon: Thanks, good morning. Following up on the strength in fundraising, could you give a little help around the management fee cadence given timing, and also catch-up fees as we think about first and final closes as the year progresses? Any timing or guidance around that would be helpful. Hadley Peer Marshall: Sure. We have already closed for our flagship private equity strategy—we had an initial first close of $6 billion—and we will have the final first close later this year. We anticipate with our infrastructure flagship fundraising to have a meaningful first close also in 2026. Fees should be turning on for both of those strategies very shortly. As an example, this quarter we did not have any catch-up fees, but you will see that build throughout the year. Operator: Our next question comes from Craig Siegenthaler with Bank of America. Craig Siegenthaler: Hey, good morning, everyone. Brookfield Asset Management Ltd.’s stock-based comp payout is the lowest in the U.S. peer group, but it does jump around a little bit. I know part of this is seasonal, but could you refresh us on the seasonal drivers and how stock-based comp fits into your overall employee compensation program? This is an important input for a lot of us with valuation. Connor Teskey: Sure. Perhaps I can take it from a corporate side. We use stock-based compensation as our primary form of compensation for the entirety of the senior leadership team at Brookfield Asset Management Ltd. Beyond that, we include stock-based comp as a component for every single investment professional across the firm. We think that is unique in that it aligns the broader firm such that investment professionals are not only focused on driving value in their individual strategy, but driving value across the entire firm. Whenever we see an opportunity—regardless of vertical, group, or geography—if someone can add value to a transaction or initiative, they get brought in. We use stock-based comp extremely widely across the firm—in our view, far wider than almost anyone in the peer group. Operator: Our next question comes from Mario Saric with Scotiabank. Mario Saric: Maybe for Armen, coming back to the Oaktree integration. As you mentioned, the relationship between Brookfield and Oaktree has been in effect for some time now. Can you provide some examples of low-hanging fruit that may not be as apparent from the outside that comes from owning 100% and the integration that may have a direct incremental impact on FRE for Brookfield Asset Management Ltd., more so than existing as separate entities? Armen Panossian: Thanks for the question. A couple of things. Brookfield Asset Management Ltd. and Oaktree established their partnership in 2019, and that partnership and the relationships between the two institutions have grown and become a lot closer. We have gotten to know each other very well. We are very aligned. The foundation is very strong, and we share a lot of the same cultures and investment principles, including taking a long-term view through the cycle. It is not early days; it is several years in the making now. We have had a chance to think about the synergies. The synergies are largely revenue synergies, in that the combination gives us the ability to offer more tailored solutions to some of the biggest clients in the market—a broader solution base that taps into the strength of Brookfield Asset Management Ltd. as an owner-operator and the strength of Oaktree as a credit manager, having invested through many cycles with distressed as our single largest strategy over 30-plus years. That tailored solution opportunity is executed through a new group at Brookfield Asset Management Ltd. called the Investment Solutions Group that has portfolio analytical capabilities to advise clients on how to adjust their portfolios over time, and how possibly Brookfield Asset Management Ltd., Oaktree, and partner manager solutions could be brought to bear. The breadth and depth we have as a combined institution is really unmatched, and being able to offer those products in a seamless, one-firm way is new and exciting. Another benefit is balance sheet optimization. Oaktree had a balance sheet on its own; Brookfield Asset Management Ltd. had a balance sheet on its own. Optimizing two balance sheets separately was not as efficient as it could have been. Bringing them together helps us maximize value for shareholders under a single platform, rather than having disparate ownership between one balance sheet and the other. Finally, Oaktree has a very large and built-out credit platform with a substantial middle and back office able to support our strategy and more. As we grow our credit capabilities in partnership with Brookfield Asset Management Ltd. in a more integrated way, we can layer on additional revenue and AUM with only a modest increase in cost. We do not need to step up costs in a meaningful way because we are already a scale player. So there is a cost benefit, but it is not about taking a big knife to cost structures; it is about using the platform in a scaled manner to drive profitability as we grow. Operator: Our next question comes from Kristen Love with Piper Sandler. Kristen Love: Thank you. Good morning. I appreciate you taking my question. First, on real estate—Connor, you hit on the recovery accelerating in your prepared remarks. Can you dig into that a bit further? Which areas of real estate are you seeing the most opportunities today to put capital to work, and then relatedly, your outlook on office? Connor Teskey: In addressing that, two things. The real estate recovery—and its very rapid acceleration—is a part of our business where what we are seeing on the ground is far ahead of what you are reading in the headlines. We are seeing very significant increases in transaction activity, deal volumes, and valuations. Across our real estate platform on the asset side, we are looking to do about $20 billion of real estate transactions in a two-month period here, just to give a sense of the pace and breadth of deal volume. In terms of where we are seeing that activity, it is primarily in what I will call the “growth” forms of real estate: hospitality, logistics, and housing. We have seen lower deal activity to date in office and retail, but we think that is coming because the fundamentals for office are absolutely flying—and it comes down to one thing. On a relative basis, nobody started new construction. There was no new supply generated starting in 2020 because of the pandemic, then following 2020 because of the rise in rates, and then because of work-from-home concerns. We have now seen a recovery in demand that is being matched by zero new supply in the market. In tier-one markets, we are seeing the top come off rents—rents legitimately 50%, 70%, 80% higher than they were five years ago—and that is beginning to flow through the numbers. If that continues, it is only logical that we are going to see deal activity return to that sector as well. Operator: Our next question comes from Michael Cyprys with Morgan Stanley. Michael, please check your mute button. Our next question comes from Michael Brown with UBS. Michael Brown: Great, thanks for taking my question. A lot has already been covered, but I wanted to ask two that are impactful for the model. Margins have expanded to the high-50s, but you will be consolidating Oaktree, and that is at kind of a cyclical low in terms of margins, so it would be dilutive. Can you talk about the medium-term margin trajectory as you think about 2Q and then, as Oaktree normalizes and you have more operating leverage to the platform, how does that margin continue to rebuild? And then on fee rates, because there is an implication for margin there too, talk about some of the puts and takes—in 1Q some fee rates came in lower than expected, and for 2Q there is going to be a bit of noise around some of the partner buy-ins as well. Any implications for 2Q as well? Hadley Peer Marshall: Sure. On the margin front, in the second quarter, assuming we close Oaktree—which is the anticipated timing—we will adjust our margins to show our partner managers in a more transparent way. We will also have 100% of Oaktree flowing through, which, given they operate at a slightly lower margin, will be an offset. What is important to note is that across all of our businesses, when we look at our projections for the year and going forward, there is operating leverage for each of the businesses. That will continue to be evident on an apples-to-apples basis, which is important to emphasize around our margins. In terms of fee rates, overall we are seeing no spread compression around fee rates. We continue to see strong fundraising. Transaction fees play a part of that. When you look at our 2026 numbers, as Connor explained, this is going to be a record year in all categories. Operator: That concludes today’s question and answer session. I would like to turn the call back to Jason Fooks for closing remarks. Jason Fooks: If you have any additional questions on today’s release, please feel free to contact me directly. Thank you, everyone, for joining us. Operator: Today’s conference call has concluded. Thank you for participating. You may now disconnect.