KKR reported record second-quarter 2026 earnings as several unusually successful investment exits accelerated monetization activity across its private equity portfolio.
The firm generated Fee Related Earnings of $1.2 billion, increasing 37% year-over-year, while Total Operating Earnings rose 29% to $1.5 billion. Adjusted Net Income jumped 40% to approximately $1.5 billion, or $1.63 per adjusted share. KKR said the per-share results for all three measures reached quarterly and trailing-12-month records for the firm as a public company.
Investment realizations were a major contributor to the earnings increase. Net realized performance income nearly doubled to $211.9 million from $109.3 million, while net realized investment income increased to $191.3 million from $130.9 million. Total investing earnings rose 68% to $403.2 million.
KKR’s second-quarter exits included the final sale of Kokusai Electric at 20 times the firm’s original cost. The result represented one of the most substantial returns highlighted in the company’s earnings presentation.
KKR also completed the final sale of Hyundai Marine Solutions at 7.5 times cost, a partial sale of BrightSpring Health Services at 6.2 times cost, and the initial public offering of OHB at 5.5 times cost.
Additional transactions included the sale of OneStream Software at 4.5 times cost, the Global Medical Response initial public offering at approximately three times cost, the sale of another 2021-vintage private equity investment at approximately three times cost, and the sale of MasOrange at 2.5 times cost.
The results demonstrate how exits completed across different investment years, regions, industries, and strategies contributed to KKR’s record monetization quarter. The transactions included investments originating as far back as 2015, along with more recent holdings acquired in 2021 and 2024.
KKR also identified several announced transactions that had not closed as of June 30. These included the planned sale of CoolIT Systems at approximately 15 times cost, the sale of Viridor at approximately two times cost, and another infrastructure transaction expected to generate approximately two times cost. The firm also announced the $2.55 billion sale of CIRCOR International’s aerospace division.
The firm’s trailing-12-month gross monetization activity reached approximately $3.9 billion, compared with $2.9 billion for 2025. KKR also reported approximately $18.2 billion of embedded gains, which include unrealized carried interest and unrealized gains on its balance sheet and within Strategic Holdings.
Gross unrealized carried interest totaled $10.2 billion at the end of the quarter, providing KKR with a substantial pool of potential future performance income if portfolio investments are successfully realized.
The exit activity was supported by positive performance across most of KKR’s major investment portfolios. Traditional private equity generated a 4% gross return during the quarter and 9% over the trailing 12 months. Infrastructure returned 1% during the quarter and 8% over the trailing 12 months, while KKR’s leveraged and alternative credit composites each produced 5% trailing-12-month returns.
Opportunistic real estate was the exception, declining 1% during the quarter and increasing only 1% over the trailing 12 months.
KKR’s asset-management business also benefited from strong fundraising and expansion in fee-generating capital. Assets under management increased 16% year-over-year to approximately $796 billion, while fee-paying assets under management rose 15% to $638 billion.
The firm raised $34 billion of new capital during the second quarter and a record $133 billion over the trailing 12 months. KKR invested $24 billion during the quarter and $104 billion over the trailing 12 months.
Private Equity assets under management increased 19% year-over-year to approximately $255 billion. New capital raised during the quarter was driven partly by Asian Fund V, Arctos Keystone Partners Fund I, and K-Series Private Equity. Private Equity management fees increased to $491.3 million from $372.1 million, while realized performance income more than doubled to $830.7 million.
KKR also had $143 billion of uncalled commitments, commonly known as dry powder, at the end of the quarter. Another $72 billion of committed capital was not yet paying management fees but is expected to begin generating fees when invested or when the applicable investment periods begin. That capital carries a weighted-average management fee rate of approximately 0.9%.
The firm’s capital base remains heavily weighted toward long-duration vehicles. Approximately 93% of KKR’s assets under management consisted of perpetual capital or capital with an initial duration of at least eight years. About 53% was perpetual or had an initial duration of at least 15 years.
This long-duration structure provides KKR with a relatively stable source of management fees while allowing the firm to choose when to monetize investments rather than relying on frequent capital renewals.
One factor investors should consider when comparing Fee Related Earnings with the prior year is a reporting-classification change. Approximately $160 million of performance revenue from K-Series Private Equity vehicles was included within Fee Related Performance Revenues during the second quarter of 2026.
Approximately $80 million from those vehicles was reported within net realized performance income during the comparable 2025 period. KKR said the reclassification did not affect total segment earnings, consolidated net income, or Adjusted Net Income.
On a GAAP basis, net income attributable to KKR common shareholders increased to $660.1 million from $472.4 million. Diluted earnings per share increased to $0.70 from $0.50, while total revenue rose to approximately $5.73 billion from $5.09 billion.
The quarter highlights the combination of KKR’s growing recurring fee base and its ability to generate substantial returns from mature investments. Strong realizations produced immediate performance and investment income, while record fundraising, long-duration capital, and embedded gains created additional opportunities for future earnings growth.
KEY QUOTE:
“Our second quarter results reflect the strength and breadth of KKR’s global franchise. We reported record Fee Related Earnings, Total Operating Earnings and Adjusted Net Income per share on both a quarterly and trailing twelve-month basis. Our continued return of capital to clients led to our strongest monetization quarter ever and helped drive record new capital inflows over the past 12 months. As we look ahead, we remain confident in our long-term positioning and our ability to deliver differentiated outcomes for our clients and shareholders.”
Joseph Y. Bae and Scott C. Nuttall, Co-Chief Executive Officers
