Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis should be read in conjunction with Blackstone Inc.’s condensed consolidated financial statements and the related notes included within this Quarterly Report on

Form 10-Q.

In this report, references to “Blackstone,” the “Company,” “we,” “us” or “our” refer to Blackstone Inc. and its consolidated subsidiaries.

Our Business

Blackstone is one of the world’s leading investment firms. Our business is organized into four segments:

Real Estate

Our real estate business is a global leader in real estate investing. Our Real Estate segment operates as one globally integrated business, with investments in the Americas, Europe and Asia. Our real estate investment teams seek to utilize our global expertise and presence to generate attractive risk-adjusted returns for our investors.

Our Blackstone Real Estate Partners (“BREP”) business is geographically diversified and targets a broad range of opportunistic real estate and real estate-related investments. The BREP funds include global funds as well as funds focused specifically on Europe or Asia investments. BREP seeks to invest thematically in high-quality assets, focusing where we see outsized growth potential driven by global economic and demographic trends. BREP has made significant investments in logistics, office, rental housing, hospitality and retail properties around the world, as well as in a variety of real estate operating companies.

Our Core+ strategy invests in substantially stabilized real estate globally with long-term growth potential. Our institutional North America, Europe and Asia Core+ strategies, Blackstone Property Partners (“BPP”), focus on logistics, residential, office, life science office and retail assets in global gateway cities. The Core+ Real Estate business also comprises strategies tailored for income-focused individual investors including, Blackstone Real Estate Income Trust, Inc. (“BREIT”), a U.S.

non-listed

REIT, and Blackstone European Property Income (“BEPIF”) funds.

Our Blackstone Real Estate Debt Strategies (“BREDS”) vehicles primarily target real estate-related debt investment opportunities. BREDS invests in both public and private markets, primarily in the U.S. and Europe. BREDS’ scale and investment mandates enable it to provide a variety of lending options for our borrowers and investment options for our investors, including commercial real estate and mezzanine loans, residential mortgage loan pools and liquid real estate-related debt securities. The BREDS platform includes high-yield real estate debt funds, liquid real estate debt funds and Blackstone Mortgage Trust, Inc. (“BXMT”), a NYSE-listed real estate investment trust (“REIT”).

Private Equity

Our Private Equity segment includes our corporate private equity business, which consists of (a) our global private equity funds, Blackstone Capital Partners (“BCP”), (b) our sector-focused funds, including our energy-focused funds, Blackstone Energy Partners (“BEP”), (c) our Asia-focused private equity funds, Blackstone Capital Partners Asia and (d) our core private equity funds, Blackstone Core Equity Partners (“BCEP”). Our Private Equity segment also includes (a) our opportunistic investment platform that invests globally across asset classes, industries and geographies, Blackstone Tactical Opportunities (“Tactical Opportunities”), (b) our secondary fund of funds business, Strategic Partners Fund Solutions (“Strategic Partners”), (c) our infrastructure-focused funds, Blackstone Infrastructure Partners (“BIP”), (d) our life sciences investment platform, Blackstone Life Sciences (“BXLS”), (e) our growth equity investment platform, Blackstone Growth (“BXG”), (f) our multi-asset investment program for eligible high net worth investors offering exposure to certain of Blackstone’s key illiquid investment strategies through a single commitment, Blackstone Total Alternatives Solution (“BTAS”) and (g) our capital markets services business, Blackstone Capital Markets (“BXCM”).

We are a global leader in private equity investing. Our corporate private equity business pursues transactions across industries on a global basis. It strives to create value by investing in great businesses where our capital, strategic insight, global relationships and operational support can drive transformation. Our corporate private equity business’s investment strategies and core themes continually evolve in anticipation of, or in response to, changes in the global economy, local markets, regulation, capital flows and geopolitical trends. We seek to construct a differentiated portfolio of investments with a well-defined, post-acquisition value creation strategy. Similarly, we seek investments that can generate strong unlevered returns regardless of entry or exit cycle timing. Blackstone Core Equity Partners pursues control-oriented investments in high-quality companies with durable businesses and seeks to offer a lower level of risk and a longer hold period than traditional private equity.

Tactical Opportunities pursues a thematically driven, opportunistic investment strategy. Our flexible, global mandate enables us to find differentiated opportunities across asset classes, industries, and geographies and invest behind them with the frequent use of structure to generate attractive risk-adjusted returns. With a focus on businesses and/or asset-backed investments in market sectors that are benefitting from long-term transformational tailwinds, Tactical Opportunities seeks to leverage the full power of Blackstone to help those businesses grow and improve. Tactical Opportunities’ ability to dynamically shift focus to the most compelling opportunities in any market environment, combined with the business’ expertise in structuring complex transactions, enables Tactical Opportunities to invest behind attractive market areas often with securities that provide downside protection and maintain upside return.

Strategic Partners, our secondary fund of funds business, is a total fund solutions provider. As a secondary investor it acquires interests in high-quality private funds from original holders seeking liquidity. Strategic Partners focuses on a range of opportunities in underlying funds such as private equity, real estate, infrastructure, venture and growth capital, credit and other types of funds, as well as general

partner-led

transactions and primary investments and

co-investments

with financial sponsors. Strategic Partners also provides investment advisory services to separately managed account clients investing in primary and secondary investments in private funds and

co-investments.

BIP targets a diversified mix of core+, core and public-private partnership investments across all infrastructure sectors, including energy infrastructure, transportation, digital infrastructure, and water and waste with a primary focus in the U.S. BIP applies a disciplined, operationally intensive investment approach to investments, seeking to apply a long-term

buy-and-hold

strategy to large-scale infrastructure assets with a focus on delivering stable, long-term capital appreciation together with a predictable annual cash flow yield.

BXLS is our investment platform with capabilities to invest across the life cycle of companies and products within the life sciences sector. BXLS primarily focuses on investments in life sciences products in late stage clinical development within the pharmaceutical and biotechnology sectors.

BXG is our growth equity platform that seeks to deliver attractive risk-adjusted returns by investing in dynamic, growth-stage businesses, with a focus on the consumer, enterprise solutions, financial services and healthcare sectors.

Hedge Fund Solutions

The principal component of our Hedge Fund Solutions segment is Blackstone Alternative Asset Management (“BAAM”). BAAM is the world’s largest discretionary allocator to hedge funds, managing a broad range of commingled and customized fund solutions since its inception in 1990. The Hedge Fund Solutions segment also includes (a) our GP Stakes business (“GP Stakes”), which targets minority investments in the general partners of private equity and other private-market alternative asset management firms globally, with a focus on delivering a combination of recurring annual cash flow yield and long-term capital appreciation, (b) investment platforms that invest directly, including our Blackstone Strategic Opportunity Fund, which seeks to produce attractive long-term, risk-adjusted returns by investing in a wide variety of securities, assets and instruments, often sourced and/or managed by third party subadvisors or affiliated Blackstone managers, (c) our hedge fund seeding business and (d) registered funds that provide alternative asset solutions through daily liquidity products. Hedge Fund Solutions’ overall investment philosophy is to grow investors’ assets through both commingled and custom-tailored investment strategies designed to deliver compelling risk-adjusted returns. Diversification, risk management and due diligence are key tenets of our approach.

Credit & Insurance

Our Credit & Insurance segment includes Blackstone Credit (“BXC”). BXC is one of the largest credit-oriented managers in the world. The investment portfolios of the funds BXC manages or

sub-advises

consist of loans and securities of

non-investment

and investment grade companies spread across the capital structure including senior debt, subordinated debt, preferred stock and common equity.

BXC is organized into two overarching strategies: private credit and liquid credit. BXC’s private credit strategies include mezzanine and direct lending funds, private placement strategies, stressed/distressed strategies and energy strategies (including our sustainable resources platform). BXC’s direct lending funds include Blackstone Private Credit Fund (“BCRED”) and Blackstone Secured Lending Fund (“BXSL”), both of which are business development companies (“BDCs”). BXC’s liquid credit strategies consist of collateralized loan obligations (“CLOs”), closed-ended funds, open-ended funds, systematic strategies and separately managed accounts.

Our Credit & Insurance segment also includes our insurer-focused platform, Blackstone Insurance Solutions (“BIS”). BIS focuses on providing full investment management services for insurers’ general accounts, seeking to deliver customized and diversified portfolios that include allocations to Blackstone managed products and strategies across asset classes and Blackstone’s private credit origination capabilities. BIS provides its clients tailored portfolio construction and strategic asset allocation, seeking to generate risk-managed, capital-efficient returns, diversification and capital preservation that meets clients’ objectives. BIS also provides similar services to clients through separately managed accounts or by

sub-managing

assets for certain insurance-dedicated funds and special purpose vehicles.

In addition, our Credit & Insurance segment includes our asset-based finance platform and our publicly traded midstream energy infrastructure, listed infrastructure and master limited partnership (“MLP”) investment platform, which is managed by Harvest Fund Advisors LLC (“Harvest”). Harvest primarily invests capital raised from institutional investors in separately managed accounts and pooled vehicles, investing in publicly traded energy infrastructure, listed infrastructure, renewables and MLPs holding primarily midstream energy assets in North America.

Revenue

We generate revenue from fees earned pursuant to contractual arrangements with funds, fund investors and fund portfolio companies (including management, transaction and monitoring fees), and from capital markets services. We also invest in the funds we manage and we are entitled to a

pro-rata

share of the results of the fund

(a “pro-rata

allocation”). In addition to a

pro-rata

allocation, and assuming certain investment returns are achieved, we are entitled to a disproportionate allocation of the income otherwise allocable to the limited partners, commonly referred to as carried interest (“Performance Allocations”). In certain structures, we receive a contractual incentive fee from an investment fund in the event that specified cumulative investment returns are achieved (an “Incentive Fee,” and together with Performance Allocations, “Performance Revenues”). The composition of our revenues will vary based on market conditions and the cyclicality of the different businesses in which we operate. Net investment gains and investment income generated by the Blackstone Funds are driven by value created by our operating and strategic initiatives as well as overall market conditions. Fair values are affected by changes in the fundamentals of our portfolio company and other investments, the industries in which they operate, the overall economy and other market conditions.

Business Environment

Blackstone’s businesses are materially affected by conditions in the financial markets and economic conditions in the U.S., Europe, Asia and, to a lesser extent, elsewhere in the world.

The second quarter of 2022 was characterized by steep declines and significant volatility in global markets, driven by investor concerns over inflation, rising interest rates, slowing economic growth and geopolitical uncertainty. Inflation across many key economies reached generational highs, prompting central banks to take monetary policy tightening actions that are likely to create headwinds to economic growth. Continued global supply chain disruption, including due to China’s recurrent

COVID-19

restrictions and the ongoing war between Russia and Ukraine, are also contributing to mounting inflationary pressure. In the U.S., annual inflation rose to 9.1% in June, the highest level in over 40 years, up from 8.3% in April. Concurrently, Europe experienced 8.6% year-over-year inflation in June. In response to rising inflation, the Federal Reserve raised the fed funds target range to

2.25-2.50%

and the European Central Bank raised rates for the first time in 11 years by 0.50%. Both central banks reiterated expectations for additional increases in the coming months. While several key economic factors, including employment, wage growth and household savings, have demonstrated resilience, the U.S. economic contraction in the first and second quarters of 2022 has opened a debate among economists as to whether the U.S. has entered, or in the near term will enter, a recession.

For the first six months of 2022, the S&P 500 declined 20% — the largest first-half decline since 1970, with declines in every sector except energy. The consumer discretionary sector experienced the largest decline, down 33%

year-to-date,

driven in part by margin pressures, including due to persistent inflation and supply chain issues. Energy was the best performing sector

year-to-date,

up 32%, and among the most resilient in the second quarter, down 5%. The price of West Texas Intermediate crude oil increased 5% to $106 per barrel in the second quarter, marking a 41% jump since the start of the year.

Volatility increased in the second quarter, with the CBOE Volatility Index rising 40%, contributing to a material slowdown in capital markets activity. U.S. IPO volumes decreased 93% compared to the second quarter of 2021 while U.S. announced merger and acquisition deal volumes declined 37% over the same period.

The

ten-year

Treasury yield increased 67 basis points to 3.01% in the second quarter. Three-month LIBOR increased 132 basis points to 2.29% in the second quarter and has since climbed to 2.80% as of August 1, 2022.

In credit markets, the S&P leveraged loan index declined by 4.5% and the Credit Suisse high yield bond index declined by 9.7% in the second quarter. High yield spreads expanded by 217 basis points, while issuance decreased 82% compared to the second quarter of 2021.

The U.S. unemployment rate remained stable since the first quarter at 3.6% as of June 2022. Wages, however continued to rise, increasing 5.1% year-over-year in June and exceeding the

15-year

average of 2.9%. Retail sales increased 8.4% in June 2022 compared to June 2021, on a seasonally adjusted basis, driven in part by higher prices. The Institute for Supply Management Purchasing Managers’ Index decreased to 53.0 in the second quarter from 60.6 in June 2021, signaling slowing expansion in the U.S. manufacturing sector.

Headline economic measures were generally healthy in the second quarter. Inflation continues to rise and will likely cause the Federal Reserve to continue raising interest rates. Additionally, rising rates, increasing costs and supply chain issues may dampen consumer spending and slow corporate profit growth, which may negatively impact equity values. There is a debate among economists as to whether such factors, coupled with economic contraction in the U.S. in the first and second quarters of 2022, indicate that the U.S. has entered, or in the near term will enter, a recession.

Notable Transactions

On June 1, 2022, Blackstone, through its indirect subsidiary Blackstone Holdings Finance Co. L.L.C. (the “Issuer”), issued

€

500 million aggregate principal amount of 3.500% senior notes due June 1, 2034.

On June 3, 2022, Blackstone, through the Issuer, entered into an amended and restated $4.1 billion revolving credit facility with Citibank, N.A., as administrative agent, and the lenders party thereto. The amendment and restatement, among other things, increased the amount of available borrowings and extended the maturity date from November 24, 2025 to June 3, 2027.

For additional information see Note 12. “Borrowings” in the “Notes to Condensed Consolidated Financial Statements” in “Part I. Item 1. Financial Statements.”

Organizational Structure

Effective February 26, 2021, Blackstone effectuated changes to rename its Class A common stock as “common stock,” and to reclassify its Class B and Class C common stock into a new “Series I preferred stock” and “Series II preferred stock,” respectively. Each new stock has the same rights and powers of its predecessor. For additional information, see Note 1. “Organization” and Note 14. “Earnings Per Share and Stockholders’ Equity — Stockholders’ Equity” in the “Notes to Condensed Consolidated Financial Statements” in “— Item 1. Financial Statements” of this filing.

Effective August 6, 2021, The Blackstone Group Inc. changed its name to Blackstone Inc. For additional information, see Note 1. “Organization” in the “Notes to Condensed Consolidated Financial Statements” in “— Item 1. Financial Statements.”

The simplified diagram below depicts our current organizational structure. The diagram does not depict all of our subsidiaries, including intermediate holding companies through which certain of the subsidiaries depicted are held.

Key Financial Measures and Indicators

We manage our business using certain financial measures and key operating metrics since we believe these metrics measure the productivity of our investment activities. We prepare our Condensed Consolidated Financial Statements in accordance with accounting principles generally accepted in the United States of America (“GAAP”). See Note 2. “Summary of Significant Accounting Policies” in the “Notes to Condensed Consolidated Financial Statements” in “Part I. Item 1. Financial Statements” and “— Critical Accounting Policies.” Our key

non-GAAP

financial measures and operating indicators and metrics are discussed below.

Distributable Earnings

Distributable Earnings is derived from Blackstone’s segment reported results. Distributable Earnings is used to assess performance and amounts available for dividends to Blackstone shareholders, including Blackstone personnel and others who are limited partners of the Blackstone Holdings Partnerships. Distributable Earnings is the sum of Segment Distributable Earnings plus Net Interest and Dividend Income (Loss) less Taxes and Related Payables. Distributable Earnings excludes unrealized activity and is derived from and reconciled to, but not equivalent to, its most directly comparable GAAP measure of Income Before Provision (Benefit) for Taxes. See “—

Non-GAAP

Financial Measures” for our reconciliation of Distributable Earnings.

Net Interest and Dividend Income (Loss) is presented on a segment basis and is equal to Interest and Dividend Revenue less Interest Expense, adjusted for the impact of consolidation of Blackstone Funds, and interest expense associated with the Tax Receivable Agreement.

Taxes and Related Payables represent the total GAAP tax provision adjusted to include only the current tax provision (benefit) calculated on Income Before Provision (Benefit) for Taxes and including the Payable under the Tax Receivable Agreement. Further, the current tax provision utilized when calculating Taxes and Related Payables and Distributable Earnings reflects the benefit of deductions available to the company on certain expense items that are excluded from the underlying calculation of Segment Distributable Earnings and Total Segment Distributable Earnings, such as equity-based compensation charges and certain Transaction-Related Charges where there is a current tax provision or benefit. The economic assumptions and methodologies that impact the implied income tax provision are the same as those methodologies and assumptions used in calculating the current income tax provision for Blackstone’s Condensed Consolidated Statements of Operations under GAAP, excluding the impact of divestitures and accrued tax contingencies and refunds which are reflected when paid or received. Management believes that including the amount payable under the tax receivable agreement and utilizing the current income tax provision adjusted as described above when calculating Distributable Earnings is meaningful as it increases comparability between periods and more accurately reflects earnings that are available for distribution to shareholders.

Segment Distributable Earnings

Segment Distributable Earnings is Blackstone’s segment profitability measure used to make operating decisions and assess performance across Blackstone’s four segments. Segment Distributable Earnings represents the net realized earnings of Blackstone’s segments and is the sum of Fee Related Earnings and Net Realizations for each segment. Blackstone’s segments are presented on a basis that deconsolidates Blackstone Funds, eliminates

non-controlling

ownership interests in Blackstone’s consolidated operating partnerships, removes the amortization of intangible assets and removes Transaction-Related Charges. Transaction-Related Charges arise from corporate actions including acquisitions, divestitures and Blackstone’s initial public offering. They consist primarily of equity-based compensation charges, gains and losses on contingent consideration arrangements, changes in the balance of the Tax Receivable Agreement resulting from a change in tax law or similar event, transaction costs and any gains or losses associated with these corporate actions. Segment Distributable Earnings excludes unrealized activity and is derived from and reconciled to, but not equivalent to, its most directly comparable GAAP measure of Income Before Provision (Benefit) for Taxes. See “—

Non-GAAP

Financial Measures” for our reconciliation of Segment Distributable Earnings.

Net Realizations is presented on a segment basis and is the sum of Realized Principal Investment Income and Realized Performance Revenues (which refers to Realized Performance Revenues excluding Fee Related Performance Revenues), less Realized Performance Compensation (which refers to Realized Performance Compensation excluding Fee Related Performance Compensation and Equity-Based Performance Compensation).

Realized Performance Compensation reflects an increase in the aggregate Realized Performance Compensation paid to certain of our professionals above the amounts allocable to them based upon the percentage participation in the relevant performance plans previously awarded to them as a result of a new compensation program that commenced during the three months ended June 30, 2021. The expectation is that for the full year 2022, Fee Related Compensation will be decreased by the total amount of additional Performance Compensation awarded for the year. In the three and six months ended June 30, 2022 the increase to Realized Performance Compensation of $50.0 million and $65.0 million, respectively, was greater than the decrease to Fee Related Compensation of $20.0 million and $40.0 million, respectively. These changes to Realized Performance Compensation and Fee Related Compensation reduced Net Realizations, increased Fee Related Earnings and had a negative impact to Income Before Provision (Benefit) for Taxes and Distributable Earnings in the three and six months ended June 30, 2022. These changes are not expected to impact Income Before Provision (Benefit) for Taxes and Distributable Earnings for the full year. In the three months ended June 30, 2021 Realized Performance Compensation was increased, and Fee Related Compensation was decreased, by $15.0 million. This reduced Net Realizations, increased Fee Related Earnings, was neutral to Income Before Provision (Benefit) for Taxes and had no impact to Distributable Earnings for such period.

Fee Related Earnings

Fee Related Earnings is a performance measure used to assess Blackstone’s ability to generate profits from revenues that are measured and received on a recurring basis and not subject to future realization events. Fee Related Earnings equals management and advisory fees (net of management fee reductions and offsets) plus Fee Related Performance Revenues, less (a) Fee Related Compensation on a segment basis, and (b) Other Operating Expenses. Fee Related Earnings is derived from and reconciled to, but not equivalent to, its most directly comparable GAAP measure of Income Before Provision (Benefit) for Taxes. See “—

Non-GAAP

Financial Measures” for our reconciliation of Fee Related Earnings.

Fee Related Compensation is presented on a segment basis and refers to the compensation expense, excluding Equity-Based Compensation, directly related to (a) Management and Advisory Fees, Net and (b) Fee Related Performance Revenues, referred to as Fee Related Performance Compensation.

Fee Related Performance Revenues refers to the realized portion of Performance Revenues from Perpetual Capital that are (a) measured and received on a recurring basis, and (b) not dependent on realization events from the underlying investments.

Other Operating Expenses is presented on a segment basis and is equal to General, Administrative and Other Expenses, adjusted to (a) remove the amortization of transaction-related intangibles, (b) remove certain expenses reimbursed by the Blackstone Funds which are netted against Management and Advisory Fees, Net in Blackstone’s segment presentation, and (c) give effect to an administrative fee collected on a quarterly basis from certain holders of Blackstone Holdings Partnership Units. The administrative fee is accounted for as a capital contribution under GAAP, but is reflected as a reduction of Other Operating Expenses in Blackstone’s segment presentation.

Adjusted Earnings Before Interest, Taxes and Depreciation and Amortization

Adjusted Earnings Before Interest, Taxes and Depreciation and Amortization (“Adjusted EBITDA”), is a supplemental measure used to assess performance derived from Blackstone’s segment results and may be used to assess its ability to service its borrowings. Adjusted EBITDA represents Distributable Earnings plus the addition of (a) Interest Expense on a segment basis, (b) Taxes and Related Payables, and (c) Depreciation and Amortization. Adjusted EBITDA is derived from and reconciled to, but not equivalent to, its most directly comparable GAAP measure of Income Before Provision (Benefit) for Taxes. See “—

Non-GAAP

Financial Measures” for our reconciliation of Adjusted EBITDA.

Net Accrued Performance Revenues

Net Accrued Performance Revenues is a financial measure used as an indicator of potential future realized performance revenues based on the current investment portfolio of the funds and vehicles we manage. Net Accrued Performance Revenues represents the accrued performance revenues receivable by Blackstone, net of the related accrued performance compensation payable by Blackstone, excluding Performance Revenues that have been realized but not yet distributed as of the reporting date and clawback amounts, if any. Net Accrued Performance Revenues is derived from and reconciled to, but not equivalent to, its most directly comparable GAAP measure of Investments. See “—

Non-GAAP

Financial Measures” for our reconciliation of Net Accrued Performance Revenues and Note 2. “Summary of Significant Accounting Policies — Equity Method Investments” in the “Notes to Condensed Consolidated Financial Statements” in “— Item 1. Financial Statements” for additional information on the calculation of Investments — Accrued Performance Allocations.

Operating Metrics

The alternative asset management business is primarily based on managing third party capital and does not require substantial capital investment to support rapid growth. Since our inception, we have developed and used various key operating metrics to assess and monitor the operating performance of our various alternative asset management businesses in order to monitor the effectiveness of our value creating strategies.

Total and

Fee-Earning

Assets Under Management

Total Assets Under Management refers to the assets we manage. Our Total Assets Under Management equals the sum of:

	(a)	the fair value of the investments held by our carry funds and our side-by-side and co-investment entities managed by us plus the capital that we are entitled to call from investors in those funds and entities pursuant to the terms of their respective capital commitments, including capital commitments to funds that have yet to commence their investment periods,

	(b)	the net asset value of (1) our hedge funds, real estate debt carry funds, BPP, certain co-investments managed by us, certain credit-focused funds, and our Hedge Fund Solutions drawdown funds (plus, in each case, the capital that we are entitled to call from investors in those funds, including commitments yet to commence their investment periods), and (2) our funds of hedge funds, our Hedge Fund Solutions registered investment companies, BREIT, and BEPIF,

	(c)	the invested capital, fair value or net asset value of assets we manage pursuant to separately managed accounts,

	(d)	the amount of debt and equity outstanding for our CLOs during the reinvestment period,

	(e)	the aggregate par amount of collateral assets, including principal cash, for our CLOs after the reinvestment period,

	(f)	the gross or net amount of assets (including leverage where applicable) for our credit-focused registered investment companies,

	(g)	the fair value of common stock, preferred stock, convertible debt, term loans or similar instruments issued by BXMT, and

	(h)	borrowings under and any amounts available to be borrowed under certain credit facilities of our funds.

Our carry funds are commitment-based drawdown structured funds that do not permit investors to redeem their interests at their election. Our funds of hedge funds, hedge funds, funds structured like hedge funds and other open-ended funds in our Real Estate, Hedge Fund Solutions and Credit & Insurance segments generally have structures that afford an investor the right to withdraw or redeem their interests on a periodic basis (for example, annually or quarterly), typically with 30 to 95 days’ notice, depending on the fund and the liquidity profile of the underlying assets. In our Perpetual Capital vehicles where redemption rights exist, Blackstone has the ability to fulfill redemption requests only (a) in Blackstone’s or the vehicles’ board’s discretion, as applicable, or (b) to the extent there is sufficient new capital. Investment advisory agreements related to certain separately managed accounts in our Hedge Fund Solutions and Credit & Insurance segments, excluding our BIS separately managed accounts, may generally be terminated by an investor on 30 to 90 days’ notice. Our BIS separately managed accounts can generally only be terminated for long-term underperformance, cause and certain other limited circumstances, in each case subject to Blackstone’s right to cure.

Fee-Earning

Assets Under Management refers to the assets we manage on which we derive management fees and/or performance revenues. Our

Fee-Earning

Assets Under Management equals the sum of:

	(a)	for our Private Equity segment funds and Real Estate segment carry funds, including certain BREDS and Hedge Fund Solutions funds, the amount of capital commitments, remaining invested capital, fair value, net asset value or par value of assets held, depending on the fee terms of the fund,

	(b)	for our credit-focused carry funds, the amount of remaining invested capital (which may include leverage) or net asset value, depending on the fee terms of the fund,

	(c)	the remaining invested capital or fair value of assets held in co-investment vehicles managed by us on which we receive fees,

	(d)	the net asset value of our funds of hedge funds, hedge funds, BPP, certain co-investments managed by us, certain registered investment companies, BREIT, BEPIF, and certain of our Hedge Fund Solutions drawdown funds,

	(e)	the invested capital, fair value of assets or the net asset value we manage pursuant to separately managed accounts,

	(f)	the net proceeds received from equity offerings and accumulated distributable earnings of BXMT, subject to certain adjustments,

	(g)	the aggregate par amount of collateral assets, including principal cash, of our CLOs, and

	(h)	the gross amount of assets (including leverage) or the net assets (plus leverage where applicable) for certain of our credit-focused registered investment companies.

Each of our segments may include certain

Fee-Earning

Assets Under Management on which we earn performance revenues but not management fees.

Our calculations of Total Assets Under Management and

Fee-Earning

Assets Under Management may differ from the calculations of other asset managers, and as a result this measure may not be comparable to similar measures presented by other asset managers. In addition, our calculation of Total Assets Under Management includes commitments to, and the fair value of, invested capital in our funds from Blackstone and our personnel, regardless of whether such commitments or invested capital are subject to fees. Our definitions of Total Assets Under Management and

Fee-Earning

Assets Under Management are not based on any definition of total assets under management and

fee-earning

assets under management that is set forth in the agreements governing the investment funds that we manage.

For our carry funds, Total Assets Under Management includes the fair value of the investments held and uncalled capital commitments, whereas

Fee-Earning

Assets Under Management may include the total amount of capital commitments or the remaining amount of invested capital at cost, depending on whether the investment period has expired or as specified by the fee terms of the fund. As such, in certain carry funds

Fee-Earning

Assets Under Management may be greater than Total Assets Under Management when the aggregate fair value of the remaining investments is less than the cost of those investments.

Perpetual Capital

Perpetual Capital refers to the component of assets under management with an indefinite term, that is not in liquidation, and for which there is no requirement to return capital to investors through redemption requests in the ordinary course of business, except where funded by new capital inflows. Perpetual Capital includes

co-investment

capital with an investor right to convert into Perpetual Capital.

Dry Powder

Dry Powder represents the amount of capital available for investment or reinvestment, including general partner and employee capital, and is an indicator of the capital we have available for future investments.

Performance Eligible Assets Under Management

Performance Eligible Assets Under Management represents invested and to be invested capital at fair value, including capital closed for funds whose investment period has not yet commenced, on which performance revenues could be earned if certain hurdles are met.

Consolidated Results of Operations

Following is a discussion of our consolidated results of operations. For a more detailed discussion of the factors that affected the results of our four business segments (which are presented on a basis that deconsolidates the investment funds, eliminates

non-controlling

ownership interests in Blackstone’s consolidated operating partnerships and removes the amortization of intangibles assets and Transaction-Related Charges) in these periods, see “— Segment Analysis” below.

The following table sets forth information regarding our consolidated results of operations and certain key operating metrics for the three and six months ended June 30, 2022 and 2021:

		Three Months Ended																Six Months Ended
		June 30,								2022 vs. 2021								June 30,								2022 vs. 2021
		2022				2021				$				%				2022				2021				$				%
		(Dollars in Thousands)
Revenues
Management and Advisory Fees, Net		$	1,561,187			$	1,212,549			$	348,638				29	%		$	3,037,123			$	2,390,364			$	646,759				27	%
Incentive Fees			99,598				33,207				66,391				200	%			204,087				69,331				134,756				194	%
Investment Income (Loss)
Performance Allocations
Realized			2,453,769				808,620				1,645,149				203	%			4,220,155				1,342,987				2,877,168				214	%
Unrealized			(3,467,668	)			2,697,170				(6,164,838	)			n/m				(2,174,618	)			5,161,667				(7,336,285	)			n/m
Principal Investments
Realized			265,161				152,060				113,101				74	%			550,265				507,098				43,167				9	%
Unrealized			(500,490	)			328,835				(829,325	)			n/m				(426,529	)			968,150				(1,394,679	)			n/m
Total Investment Income (Loss)			(1,249,228	)			3,986,685				(5,235,913	)			n/m				2,169,273				7,979,902				(5,810,629	)			-73	%
Interest and Dividend Revenue			62,075				31,017				31,058				100	%			116,560				62,429				54,131				87	%
Other			155,588				27,896				127,692				458	%			228,457				88,200				140,257				159	%
Total Revenues			629,220				5,291,354				(4,662,134	)			-88	%			5,755,500				10,590,226				(4,834,726	)			-46	%
Expenses
Compensation and Benefits
Compensation			686,012				507,104				178,908				35	%			1,342,517				1,049,742				292,775				28	%
Incentive Fee Compensation			45,363				14,431				30,932				214	%			86,382				27,756				58,626				211	%
Performance Allocations Compensation
Realized			1,035,916				347,423				688,493				198	%			1,753,517				560,450				1,193,067				213	%
Unrealized			(1,386,543	)			1,150,219				(2,536,762	)			n/m				(914,259	)			2,200,188				(3,114,447	)			n/m
Total Compensation and Benefits			380,748				2,019,177				(1,638,429	)			-81	%			2,268,157				3,838,136				(1,569,979	)			-41	%
General, Administrative and Other			289,288				205,057				84,231				41	%			529,962				390,179				139,783				36	%
Interest Expense			69,642				44,322				25,320				57	%			136,389				89,305				47,084				53	%
Fund Expenses			4,435				3,774				661				18	%			6,627				6,157				470				8	%
Total Expenses			744,113				2,272,330				(1,528,217	)			-67	%			2,941,135				4,323,777				(1,382,642	)			-32	%
Other Income (Loss)
Change in Tax Receivable Agreement Liability			(13	)			(392	)			379				-97	%			748				2,518				(1,770	)			-70	%
Net Gains (Losses) from Fund Investment Activities			(104,326	)			127,116				(231,442	)			n/m				(53,450	)			247,469				(300,919	)			n/m
Total Other Income (Loss)			(104,339	)			126,724				(231,063	)			n/m				(52,702	)			249,987				(302,689	)			n/m
Income (Loss) Before Provision for Taxes			(219,232	)			3,145,748				(3,364,980	)			n/m				2,761,663				6,516,436				(3,754,773	)			-58	%
Provision for Taxes			36,514				288,250				(251,736	)			-87	%			519,795				287,803				231,992				81	%
Net Income (Loss)			(255,746	)			2,857,498				(3,113,244	)			n/m				2,241,868				6,228,633				(3,986,765	)			-64	%
Net Income Attributable to Redeemable Non-Controlling Interests in Consolidated Entities			25,875				637				25,238				n/m				30,927				1,266				29,661				n/m
Net Income (Loss) Attributable to Non-Controlling Interests in Consolidated Entities			(216,707	)			431,516				(648,223	)			n/m				(332	)			818,366				(818,698	)			n/m
Net Income (Loss) Attributable to Non-Controlling Interests in Blackstone Holdings			(35,521	)			1,116,193				(1,151,714	)			n/m				1,023,792				2,351,977				(1,328,185	)			-56	%
Net Income (Loss) Attributable to Blackstone Inc.		$	(29,393	)		$	1,309,152			$	(1,338,545	)			n/m			$	1,187,481			$	3,057,024			$	(1,869,543	)			-61	%

n/m Not meaningful.

Three Months Ended June 30, 2022 Compared to Three Months Ended June 30, 2021

Revenues

Revenues were $629.2 million for the three months ended June 30, 2022, a decrease of $4.7 billion, compared to $5.3 billion for the three months ended June 30, 2021. The decrease in Revenues was primarily attributable to a decrease of $5.2 billion in Investment Income (Loss), which is composed of a decrease of $7.0 billion in Unrealized Investment Income (Loss) and an increase of $1.8 billion in Realized Investment Income (Loss).

The $7.0 billion decrease in Unrealized Investment Income (Loss) was primarily attributable to net unrealized depreciation of investments in the three months ended June 30, 2022 compared to net unrealized appreciation of investments in the three months ended June 30, 2021. Principal drivers of the decrease were:

	•		The decrease of $3.4 billion in our Real Estate segment was primarily attributable to significant realizations and net unrealized depreciation of investments in BREP and lower net unrealized appreciation of investments in Core+ real estate during the three months ended June 30, 2022. BREP and Core+ real estate’s carrying value decreased 1.0% and increased 2.3%, respectively, in the three months ended June 30, 2022 compared to increases of 9.4% and 5.7%, respectively, in the three months ended June 30, 2021.

	•		The decrease of $2.7 billion in our Private Equity segment was primarily attributable to net unrealized depreciation of investments in corporate private equity and Tactical Opportunities in the three months ended June 30, 2022 compared to net unrealized appreciation of investments in the three months ended June 30, 2021. Corporate private equity and Tactical Opportunities carrying value decreased 6.7% and 2.4%, respectively, in the three months ended June 30, 2022 compared to increases of 13.8% and 7.2%, respectively, in the three months ended June 30, 2021.

The $1.8 billion increase in Realized Investment Income (Loss) was primarily attributable to higher realized gains in our Real Estate segment, partially offset by lower realized gains in our Private Equity segment.

Expenses

Expenses were $744.1 million for the three months ended June 30, 2022, a decrease of $1.5 billion, compared to $2.3 billion for the three months ended June 30, 2021. The decrease was primarily attributable to a decrease of $1.6 billion in Total Compensation and Benefits, which is composed of a decrease of $1.8 billion in Performance Allocations Compensation and an increase of $178.9 million in Compensation. The decrease in Performance Allocations Compensation was primarily due to the decrease in Investment Income (Loss), on which a portion of compensation is based. The increase in Compensation was primarily due to the increase in Management and Advisory Fees, Net, on which a portion of compensation is based.

Other Income (Loss)

Other Income (Loss) was $(104.3) million for the three months ended June 30, 2022, a decrease of $231.1 million, compared to $126.7 million for the three months ended June 30, 2021. The decrease in Other Income was due to a decrease of $231.4 million in Net Gains (Losses) from Fund Investment Activities.

The decrease in Net Gains (Losses) from Fund Investment Activities was principally driven by decreases of $123.2 million, $70.0 million, $19.3 million and $18.9 million in our Private Equity, Hedge Fund Solutions, Real Estate and Credit & Insurance segments, respectively. The decrease in our Private Equity segment was primarily due to unrealized depreciation of investments and lower realized gains of investments in our consolidated private equity funds. The decrease in our Hedge Fund Solutions segment was primarily due to unrealized depreciation of investments in our consolidated hedge fund solutions funds. The decrease in our Real Estate segment was primarily due to unrealized depreciation of investments, partially offset by higher realized gains of investments in our consolidated real estate funds. The decrease in our Credit & Insurance segment was primarily due to unrealized depreciation of investments and realized losses of investments in our consolidated credit funds.

Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021

Revenues

Revenues were $5.8 billion for the six months ended June 30, 2022, a decrease of $4.8 billion, compared to $10.6 billion for the six months ended June 30, 2021. The decrease in Revenues was primarily attributable to a decrease of $5.8 billion in Investment Income (Loss), which is composed of a decrease of $8.7 billion in Unrealized Investment Income (Loss) and an increase of $2.9 billion in Realized Investment Income (Loss), partially offset by an increase of $646.8 million in Management and Advisory Fees, Net.

The $8.7 billion decrease in Unrealized Investment Income (Loss) was primarily attributable to net unrealized depreciation of investments in the six months ended June 30, 2022 compared to net unrealized appreciation of investments in the six months ended June 30, 2021. Principal drivers of the decrease were:

	•		The decrease of $4.3 billion in our Private Equity segment was primarily attributable to net unrealized depreciation of investments in corporate private equity and Tactical Opportunities in the six months ended June 30, 2022 compared to net unrealized appreciation of investments in the six months ended June 30, 2021. Corporate private equity and Tactical Opportunities carrying value decreased 3.9% and 0.4%, respectively, in the six months ended June 30, 2022 compared to increases of 29.0% and 22.1%, respectively, in the six months ended June 30, 2021.

	•		The decrease of $3.0 billion in our Real Estate segment which was primarily attributable to significant realizations in BREP during the three months ended June 30, 2022, partially offset by lower net unrealized appreciation of investments in BREP in the six months ended June 30, 2022 compared to the six months ended June 30, 2021. BREP’s carrying value increased 9.1% in the six months ended June 30, 2022 compared to 14.9% in the six months ended June 30, 2021.

The $2.9 billion increase in Realized Investment Income (Loss) was primarily attributable to higher realized gains in our Real Estate segment, partially offset by the gain recognized in connection with the Pátria Investments Limited and Pátria Investimentos Ltda. (collectively, “Pátria”) sale transaction in the first quarter of 2021. On January 26, 2021, Pátria completed its IPO, pursuant to which Blackstone sold a portion of its interests and no longer has representatives or the right to designate representatives on Pátria’s board of directors. As a result of Pátria’s

pre-IPO

reorganization transactions (which included Blackstone’s sale of 10% of Pátria’s

pre-IPO

shares to Pátria’s controlling shareholder) and the consummation of the IPO, Blackstone was deemed to no longer have significant influence over Pátria due to Blackstone’s decreased ownership and lack of board representation.

The $646.8 million increase in Management and Advisory Fees, Net was primarily due to increases in our Real Estate and Credit & Insurance segments of $334.9 million and $275.8 million, respectively. The increase in our Real Estate segment was primarily due to

Fee-Earning

Assets Under Management growth in Core+ real estate and BREDS. The increase in our Credit & Insurance segment was primarily due to an increase in inflows in BCRED and BIS.

Expenses

Expenses were $2.9 billion for the six months ended June 30, 2022, a decrease of $1.4 billion, compared to $4.3 billion for the six months ended June 30, 2021. The decrease was primarily attributable a decrease of $1.6 billion in Total Compensation and Benefits, which is composed of a decrease of $1.9 billion in Performance Allocations Compensation and an increase of $292.8 million in Compensation, partially offset by an increase of $139.8 million in General, Administrative and Other. The decrease in Performance Allocations Compensation was primarily due to the decrease in Investment Income, on which a portion of compensation is based. The increase in Compensation was primarily due to the increase in Management and Advisory Fees, Net, on which a portion of compensation is based. The increase in General, Administrative and Other was primarily due to travel and entertainment, occupancy and technology related expenses, and professional fees.

Other Income (Loss)

Other Income (Loss) was $(52.7) million for the six months ended June 30, 2022, a decrease of $302.7 million, compared to $250.0 million for the six months ended June 30, 2021. The decrease in Other Income was due to a decrease of $300.9 million in Net Gains (Losses) from Fund Investment Activities.

The decrease in Net Gains (Losses) from Fund Investment Activities was principally driven by decreases of $193.2 million, $85.9 million and $31.3 million in our Private Equity, Hedge Fund Solutions and Credit & Insurance segments, respectively, partially offset by an increase of $9.4 million in our Real Estate segment. The decrease in our Private Equity segment was primarily due to unrealized depreciation of investments and lower realized gains of investments in our consolidated private equity funds. The decrease in our Hedge Fund Solutions segment was primarily due to unrealized depreciation of investments in our consolidated hedge fund solutions funds. The decrease in our Credit & Insurance segment was primarily due to unrealized depreciation of investments and realized losses of investments in our consolidated credit funds. The increase in our Real Estate segment was primarily due to higher realized gains of investments, partially offset by unrealized depreciation of investments in our consolidated real estate funds.

Provision for Taxes

Three Months Ended June 30, 2022 Compared to Three Months Ended June 30, 2021

Blackstone’s Provision for Taxes for the three months ended June 30, 2022 and 2021 was $36.5 million and $288.3 million, respectively. This resulted in an effective tax rate of

-16.7%

and 9.2%, respectively, based on our Income (Loss) Before Provision for Taxes of $(219.2) million and $3.1 billion. The decrease in Blackstone’s effective tax rate for the three months ended June 30, 2022, compared to the three months ended June 30, 2021, resulted primarily from the portion of the reported Income (Loss) Before Provision for Taxes that is attributable to

non-controlling

interest holders and the state tax provision.

Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021

Blackstone’s Provision for Taxes for the six months ended June 30, 2022 and 2021 was $519.8 million and $287.8 million, respectively. This resulted in an effective tax rate of 18.8% and 4.4%, respectively, based on our Income (Loss) Before Provision for Taxes of $2.8 billion and $6.5 billion. The increase in Blackstone’s effective tax rate for the six months ended June 30, 2022, compared to the six months ended June 30, 2021, resulted primarily from the reduction of valuation allowances previously recorded against deferred tax assets during 2021, and an increase in state tax provision due to recent developments affecting the allocation of income among multiple tax jurisdictions.

Additional information regarding our income taxes can be found in Note 13. “Income Taxes” in the “Notes to Condensed Consolidated Financial Statements” in “Part I. Item 1. Financial Statements” of this filing.

Non-Controlling

Interests in Consolidated Entities

The Net Income Attributable to Redeemable

Non-Controlling

Interests in Consolidated Entities and Net Income Attributable to

Non-Controlling

Interests in Consolidated Entities is attributable to the consolidated Blackstone Funds. The amounts of these items vary directly with the performance of the consolidated Blackstone Funds and largely eliminate the amount of Other Income (Loss) – Net Gains (Losses) from Fund Investment Activities from the Net Income (Loss) Attributable to Blackstone Inc.

Net Income Attributable to

Non-Controlling

Interests in Blackstone Holdings is derived from the Income Before Provision (Benefit) for Taxes at the Blackstone Holdings level, excluding the Net Gains (Losses) from Fund Investment Activities and the percentage allocation of the income between Blackstone personnel and others who are limited partners of Blackstone Holdings and Blackstone after considering any contractual arrangements that govern the allocation of income such as fees allocable to Blackstone.

For the three months ended June 30, 2022 and 2021, the Net Income Before Taxes allocated to Blackstone personnel and other limited partners of Blackstone Holdings was 39.8% and 41.4%, respectively. For the six months ended June 30, 2022 and 2021, the Net Income Before Taxes allocated to Blackstone personnel and others who are limited partners of Blackstone Holdings was 39.8% and 41.6%, respectively. The respective decreases of 1.6% and 1.8% were primarily due to the conversion of Blackstone Holdings Partnership Units to shares of common stock and the vesting of shares of common stock.

The Other Income (Loss) — Change in Tax Receivable Agreement Liability was entirely allocated to Blackstone Inc.

Operating Metrics

Total and

Fee-Earning

Assets Under Management

The following graphs and tables summarize the

Fee-Earning

Assets Under Management by Segment and Total Assets Under Management by Segment, followed by a rollforward of activity for the three and six months ended June 30, 2022 and 2021. For a description of how Assets Under Management and

Fee-Earning

Assets Under Management are determined, please see “— Key Financial Measures and Indicators — Operating Metrics — Total and

Fee-Earning

Assets Under Management.”

Note:	Totals may not add due to rounding.

		Three Months Ended
		June 30, 2022																				June 30, 2021
						Private				Hedge Fund				Credit &												Private				Hedge Fund				Credit &
		Real Estate				Equity				Solutions				Insurance				Total				Real Estate				Equity				Solutions				Insurance				Total
		(Dollars in Thousands)
Fee-Earning Assets Under Management
Balance, Beginning of Period		$	240,621,453			$	160,946,196			$	75,685,828			$	200,689,825			$	677,943,302			$	155,851,794			$	131,903,347			$	76,614,206			$	116,856,060			$	481,225,407
Inflows (a)			24,715,819				6,030,709				1,609,920				12,076,571				44,433,019				9,834,475				2,320,367				1,794,869				14,734,257				28,683,968
Outflows (b)			(3,524,671	)			(43,763	)			(3,205,253	)			(6,718,805	)			(13,492,492	)			(581,677	)			(457,610	)			(8,277,079	)			(2,502,137	)			(11,818,503	)
Net Inflows (Outflows)			21,191,148				5,986,946				(1,595,333	)			5,357,766				30,940,527				9,252,798				1,862,757				(6,482,210	)			12,232,120				16,865,465
Realizations (c)			(8,912,594	)			(2,964,236	)			(461,230	)			(1,764,406	)			(14,102,466	)			(3,069,895	)			(3,304,081	)			(294,858	)			(4,029,664	)			(10,698,498	)
Market Activity (d)(g)			(774,137	)			(447,399	)			(999,644	)			(8,734,222	)			(10,955,402	)			4,228,796				2,013,463				2,403,014				2,894,879				11,540,152
Balance, End of Period (e)		$	252,125,870			$	163,521,507			$	72,629,621			$	195,548,963			$	683,825,961			$	166,263,493			$	132,475,486			$	72,240,152			$	127,953,395			$	498,932,526
Increase (Decrease)		$	11,504,417			$	2,575,311			$	(3,056,207	)		$	(5,140,862	)		$	5,882,659			$	10,411,699			$	572,139			$	(4,374,054	)		$	11,097,335			$	17,707,119
Increase (Decrease)			5	%			2	%			-4	%			-3	%			1	%			7	%			—				-6	%			9	%			4	%

		Six Months Ended
		June 30, 2022																				June 30, 2021
						Private				Hedge Fund				Credit &												Private				Hedge Fund				Credit &
		Real Estate				Equity				Solutions				Insurance				Total				Real Estate				Equity				Solutions				Insurance				Total
		(Dollars in Thousands)
Fee-Earning Assets Under Management
Balance, Beginning of Period		$	221,476,699			$	156,556,959			$	74,034,568			$	197,900,832			$	649,969,058			$	149,121,461			$	129,539,630			$	74,126,610			$	116,645,413			$	469,433,114
Inflows (a)			47,506,860				11,480,655				5,780,000				25,025,683				89,793,198				18,395,652				6,788,988				3,800,855				22,920,908				51,906,403
Outflows (b)			(7,814,246	)			(916,360	)			(5,787,697	)			(9,791,052	)			(24,309,355	)			(1,425,237	)			(1,065,631	)			(9,623,330	)			(7,618,014	)			(19,732,212	)
Net Inflows (Outflows)			39,692,614				10,564,295				(7,697	)			15,234,631				65,483,843				16,970,415				5,723,357				(5,822,475	)			15,302,894				32,174,191
Realizations (c)			(14,204,651	)			(5,652,476	)			(824,097	)			(5,260,345	)			(25,941,569	)			(4,925,197	)			(6,375,260	)			(483,294	)			(7,276,868	)			(19,060,619	)
Market Activity (d)(h)			5,161,208				2,052,729				(573,153	)			(12,326,155	)			(5,685,371	)			5,096,814				3,587,759				4,419,311				3,281,956				16,385,840
Balance, End of Period (e)		$	252,125,870			$	163,521,507			$	72,629,621			$	195,548,963			$	683,825,961			$	166,263,493			$	132,475,486			$	72,240,152			$	127,953,395			$	498,932,526
Increase (Decrease)		$	30,649,171			$	6,964,548			$	(1,404,947	)		$	(2,351,869	)		$	33,856,903			$	17,142,032			$	2,935,856			$	(1,886,458	)		$	11,307,982			$	29,499,412
Increase (Decrease)			14	%			4	%			-2	%			-1	%			5	%			11	%			2	%			-3	%			10	%			6	%
Annualized Base Management Fee Rate (f)			1.00	%			1.07	%			0.78	%			0.60	%			0.88	%			1.12	%			1.13	%			0.82	%			0.55	%			0.93	%

		Three Months Ended
		June 30, 2022																				June 30, 2021
						Private				Hedge Fund				Credit &												Private				Hedge Fund				Credit &
		Real Estate				Equity				Solutions				Insurance				Total				Real Estate				Equity				Solutions				Insurance				Total
		(Dollars in Thousands)
Total Assets Under Management
Balance, Beginning of Period		$	298,196,783			$	267,956,351			$	82,896,827			$	266,441,781			$	915,491,742			$	196,277,032			$	211,801,085			$	81,819,220			$	158,905,670			$	648,803,007
Inflows (a)			48,878,703				20,240,070				2,006,897				17,133,155				88,258,825				8,879,659				7,335,028				2,197,161				18,869,609				37,281,457
Outflows (b)			(3,841,493	)			(557,024	)			(3,261,271	)			(6,696,478	)			(14,356,266	)			(579,152	)			(1,077,784	)			(7,299,018	)			(2,716,532	)			(11,672,486	)
Net Inflows (Outflows)			45,037,210				19,683,046				(1,254,374	)			10,436,677				73,902,559				8,300,507				6,257,244				(5,101,857	)			16,153,077				25,608,971
Realizations (c)			(19,846,905	)			(5,578,774	)			(477,605	)			(3,406,173	)			(29,309,457	)			(5,306,047	)			(8,633,166	)			(303,557	)			(5,390,278	)			(19,633,048	)
Market Activity (d)(i)			(3,348,660	)			(6,174,209	)			(1,113,440	)			(8,642,794	)			(19,279,103	)			8,276,744				14,196,196				2,731,457				4,045,385				29,249,782
Balance, End of Period (e)		$	320,038,428			$	275,886,414			$	80,051,408			$	264,829,491			$	940,805,741			$	207,548,236			$	223,621,359			$	79,145,263			$	173,713,854			$	684,028,712
Increase (Decrease)		$	21,841,645			$	7,930,063			$	(2,845,419	)		$	(1,612,290	)		$	25,313,999			$	11,271,204			$	11,820,274			$	(2,673,957	)		$	14,808,184			$	35,225,705
Increase (Decrease)			7	%			3	%			-3	%			-1	%			3	%			6	%			6	%			-3	%			9	%			5	%

		Six Months Ended
		June 30, 2022																				June 30, 2021
						Private				Hedge Fund				Credit &												Private				Hedge Fund				Credit &
		Real Estate				Equity				Solutions				Insurance				Total				Real Estate				Equity				Solutions				Insurance				Total
		(Dollars in Thousands)
Total Assets Under Management
Balance, Beginning of Period		$	279,474,105			$	261,471,007			$	81,334,141			$	258,622,467			$	880,901,720			$	187,191,247			$	197,549,222			$	79,422,869			$	154,393,590			$	618,556,928
Inflows (a)			65,922,022				29,473,707				6,022,228				36,715,840				138,133,797				17,461,122				15,166,670				4,264,119				31,993,631				68,885,542
Outflows (b)			(6,137,188	)			(1,977,487	)			(6,029,364	)			(10,216,436	)			(24,360,475	)			(2,388,253	)			(1,828,756	)			(8,922,346	)			(8,508,421	)			(21,647,776	)
Net Inflows (Outflows)			59,784,834				27,496,220				(7,136	)			26,499,404				113,773,322				15,072,869				13,337,914				(4,658,227	)			23,485,210				47,237,766
Realizations (c)			(29,384,688	)			(13,304,607	)			(916,050	)			(8,940,022	)			(52,545,367	)			(7,259,579	)			(16,726,541	)			(497,904	)			(10,017,051	)			(34,501,075	)
Market Activity (d)(j)			10,164,177				223,794				(359,547	)			(11,352,358	)			(1,323,934	)			12,543,699				29,460,764				4,878,525				5,852,105				52,735,093
Balance, End of Period (e)		$	320,038,428			$	275,886,414			$	80,051,408			$	264,829,491			$	940,805,741			$	207,548,236			$	223,621,359			$	79,145,263			$	173,713,854			$	684,028,712
Increase (Decrease)		$	40,564,323			$	14,415,407			$	(1,282,733	)		$	6,207,024			$	59,904,021			$	20,356,989			$	26,072,137			$	(277,606	)		$	19,320,264			$	65,471,784
Increase (Decrease)			15	%			6	%			-2	%			2	%			7	%			11	%			13	%			—				13	%			11	%

(a)	Inflows include contributions, capital raised, other increases in available capital (recallable capital and increased side-by-side commitments), purchases, inter-segment allocations and acquisitions.

(b)	Outflows represent redemptions, client withdrawals and decreases in available capital (expired capital, expense drawdowns and decreased side-by-side commitments).

(c)	Realizations represent realization proceeds from the disposition or other monetization of assets, current income or capital returned to investors from CLOs.

(d)	Market activity includes realized and unrealized gains (losses) on portfolio investments and the impact of foreign exchange rate fluctuations.

(e)	Total and Fee-Earning Assets Under Management are reported in the segment where the assets are managed.

(f)	Annualized Base Management Fee Rate represents annualized year to date Base Management Fee divided by the average of the beginning of year and each quarter end’s Fee-Earning Assets Under Management in the reporting period.

(g)

For the three months ended June 30, 2022, the impact to Fee-Earning Assets Under Management due to foreign exchange rate fluctuations was $(2.9) billion, $(1.5) billion and $(4.5) billion for the Real Estate, Credit & Insurance and Total segments, respectively. For the three months ended June 30, 2021, such impact was $332.1 million, $262.1 million and $599.8 million for the Real Estate, Credit & Insurance and Total segments, respectively.

(h)

For the six months ended June 30, 2022, the impact to Fee-Earning Assets Under Management due to foreign exchange rate fluctuations was $(3.8) billion, $(1.9) billion and $(5.9) billion for the Real Estate, Credit & Insurance and Total segments, respectively. For the six months ended June 30, 2021, such impact was $(777.3) million, $130.7 million and $(659.6) million for the Real Estate, Credit & Insurance and Total segments, respectively.

(i)

For the three months ended June 30, 2022, the impact to Total Assets Under Management due to foreign exchange rate fluctuations was $(4.8) billion, $(1.4) billion, $(1.8) billion and $(8.0) billion for the Real Estate, Private Equity, Credit & Insurance and Total segments, respectively. For the three months ended June 30, 2021, such impact was $452.1 million, $68.4 million, $361.8 million and $882.3 million for the Real Estate, Private Equity, Credit & Insurance and Total segments, respectively.

(j)

For the six months ended June 30, 2022, the impact to Total Assets Under Management due to foreign exchange rate fluctuations was $(6.7) billion, $(1.9) billion, $(2.2) billion and $(10.8) billion for the Real Estate, Private Equity, Credit & Insurance and Total segments, respectively. For the six months ended June 30, 2021, such impact was $(1.2) billion, $(262.2) million, $115.5 million and $(1.3) billion for the Real Estate, Private Equity, Credit & Insurance and Total segments, respectively.

Fee-Earning

Assets Under Management

Fee-Earning

Assets Under Management were $683.8 billion at June 30, 2022, an increase of $5.9 billion, compared to $677.9 billion at March 31, 2022. The net increase was due to:

	•		Inflows of $44.4 billion related to:

	o	$24.7 billion in our Real Estate segment driven by $9.4 billion from BREIT, $9.4 billion from BPP and co-investment, $4.9 billion from BREDS and $868.6 million from BREP and co-investment,

	o	$12.1 billion in our Credit & Insurance segment driven by $6.4 billion from direct lending, $1.7 billion from CLOs, $1.5 billion from asset-based finance, $1.4 billion from our energy strategies, $1.4 billion from certain liquid credit strategies and $531.8 million from stressed/distressed strategies, partially offset by net allocations to other segments of $1.3 billion across Credit & Insurance strategies,

	o	$6.0 billion in our Private Equity segment driven by $2.2 billion from Strategic Partners, $2.0 billion from BIP, $1.1 billion from corporate private equity and $823.1 million from Tactical Opportunities, and

	o	$1.6 billion in our Hedge Fund Solutions segment driven by $894.7 million from individual investor and specialized solutions and $649.1 million from customized solutions.

Offsetting these increases were:

	•		Realizations of $14.1 billion driven by:

	o	$8.9 billion in our Real Estate segment driven by $3.1 billion from BREIT, $3.0 billion from BREDS, $1.6 billion from BREP and co-investment and $1.2 billion from BPP and co-investment,

	o	$3.0 billion in our Private Equity segment driven by $1.4 billion from Tactical Opportunities, $703.1 million from Strategic Partners and $688.3 million from corporate private equity, and

	o	$1.8 billion in our Credit & Insurance segment driven by $496.4 million from CLOs, $393.9 million from our energy strategies, $335.2 million from direct lending, $208.4 million from mezzanine funds and $186.1 million from certain liquid credit strategies.

	•		Outflows of $13.5 billion primarily attributable to:

	o	$6.7 billion in our Credit & Insurance segment driven by $4.4 billion from certain liquid credit strategies, $972.0 million from BIS, $580.1 million from MLP strategies, $315.1 million from direct lending and $309.4 million from CLOs,

	o	$3.5 billion in our Real Estate segment driven by $2.9 billion from BREIT and $518.7 million from BPP and co-investment, and

	o	$3.2 billion in our Hedge Fund Solutions segment driven by $1.4 billion from commingled products, $1.1 billion from customized solutions and $709.9 million from individual investor and specialized solutions.

	•		Market activity of $11.0 billion primarily attributable to:

	o	$8.7 billion of market depreciation in our Credit & Insurance segment driven by depreciation of $4.6 billion from certain liquid credit strategies, $1.1 billion from direct lending, $976.1 million from private placement credit, $674.2 million from CLOs and $594.9 million from asset-based finance, all of which included $1.5 billion of foreign exchange depreciation across the segment,

	o	$999.6 million of market depreciation in our Hedge Fund Solutions segment driven by market activity in individual investor and specialized solutions, and

	o	$774.1 million of market depreciation in our Real Estate segment driven by depreciation of $1.4 billion from BREDS and foreign exchange depreciation of $554.0 million from BREP and co-investment, partially offset by appreciation of $1.2 billion from Core+ real estate (which included $2.2 billion of foreign exchange depreciation).

Fee-Earning

Assets Under Management were $683.8 billion at June 30, 2022, an increase of $33.9 billion, compared to $650.0 billion at December 31, 2021. The net increase was due to:

	•		Inflows of $89.8 billion related to:

	o	$47.5 billion in our Real Estate segment driven by $19.2 billion from BREIT, $10.6 billion from BPP and co-investment, $8.8 billion from BREP and co-investment and $8.2 billion from BREDS,

	o	$25.0 billion in our Credit & Insurance segment driven by $12.8 billion from direct lending, $3.5 billion from CLOs, $2.7 billion from certain liquid credit strategies, $1.9 billion from asset-based finance, $1.5 billion from our energy strategies, $773.6 million from BIS, $725.3 million from stressed/distressed strategies, $385.6 million from mezzanine funds and $303.5 million from MLP strategies,

	o	$11.5 billion in our Private Equity segment driven by $4.5 billion from BIP, $3.1 billion from Strategic Partners, $2.0 billion from Tactical Opportunities, $986.3 million from corporate private equity and $874.3 million from multi-asset products, and

	o	$5.8 billion in our Hedge Fund Solutions segment driven by $4.4 billion from individual investor and specialized solutions, $1.1 billion from customized solutions and $263.8 million from commingled products.

Offsetting these increases were:

	•		Realizations of $25.9 billion primarily driven by:

	o	$14.2 billion in our Real Estate segment driven by $5.0 billion from BREIT, $4.2 billion from BREDS, $2.9 billion from BREP and co-investment and $2.0 billion from BPP and co-investment,

	o	$5.7 billion in our Private Equity segment driven by $1.9 billion from Strategic Partners, $1.8 billion from Tactical Opportunities and $1.5 billion from corporate private equity, and

	o	$5.3 billion in our Credit & Insurance segment driven by $1.8 billion from CLOs, $1.7 billion from direct lending, $542.3 million from our energy strategies, $402.9 million from mezzanine funds, $356.4 million from stressed/distressed strategies and $349.6 million from certain liquid credit strategies.

	•		Outflows of $24.3 billion primarily attributable to:

	o	$9.8 billion in our Credit & Insurance segment driven by $5.7 billion from certain liquid credit strategies, $1.5 billion from MLP strategies, $1.3 billion from BIS, $561.2 million from direct lending and $329.4 million from CLOs,

	o	$7.8 billion in our Real Estate segment driven by $4.2 billion from BREIT, $2.1 billion from BREP and co-investment and $1.4 billion from BPP and co-investment, and

	o	$5.8 billion in our Hedge Fund Solutions segment driven by $3.1 billion from customized solutions, $1.5 billion from commingled products and $1.3 billion from individual investor and specialized solutions.

	•		Market activity of $5.7 billion primarily attributable to:

	o	$12.3 billion of market depreciation in our Credit & Insurance segment driven by depreciation of $7.9 billion from certain liquid credit strategies, $2.2 billion from private placement credit, $1.1 billion from asset-based finance and $908.3 million from CLOs, $807.6 million from direct lending, partially offset by market appreciation of $991.6 million from MLP strategies, all of which included $1.9 billion of foreign exchange depreciation across the segment,

	o	Partially offset by $5.2 billion of market appreciation in our Real Estate segment driven by appreciation of $8.8 billion from Core+ real estate (which included $2.9 billion of foreign exchange depreciation), partially offset by depreciation of $2.8 billion from BREDS and foreign exchange depreciation of $856.8 million from BREP and co-investment, and

	o	$2.1 billion of market appreciation in our Private Equity segment driven by appreciation of $1.3 billion from BIP and $737.8 million from Strategic Partners.

Total Assets Under Management

Total Assets Under Management were $940.8 billion at June 30, 2022, an increase of $25.3 billion, compared to $915.5 billion at March 31, 2022. The net increase was due to:

	•		Inflows of $88.3 billion primarily related to:

	o	$48.9 billion in our Real Estate segment driven by $26.5 billion from BREP and co-investment, $9.6 billion from BPP and co-investment, $9.4 billion from BREIT and $3.2 billion from BREDS,

	o	$20.2 billion in our Private Equity segment driven by $10.0 billion from corporate private equity, $3.1 billion from BIP, $3.0 billion from Strategic Partners, $2.9 billion from BXG and $1.0 billion from Tactical Opportunities,

	o	$17.1 billion in our Credit & Insurance segment driven by $11.6 billion from direct lending, $2.1 billion from asset-based finance, $1.7 billion from CLOs, $1.4 billion from our energy strategies and $1.4 billion from certain liquid credit strategies, partially offset by net allocations to other segments of $1.4 billion across Credit & Insurance strategies, and

	o	$2.0 billion in our Hedge Fund Solutions segment driven by $1.4 billion from individual investor and specialized solutions and $570.3 million from customized solutions.

Total Assets Under Management inflows exceeds

Fee-Earning

Assets Under Management inflows due to the following reasons:

	•		For BREP, corporate private equity and BXG, due to BREP X, BCP IX and BXG II’s first closings during the three months ended June 30, 2022. Total Assets Under Management inflows are reported at each fund closing, whereas Fee-Earning Assets Under Management inflows are reported when a fund’s investment period commences and in each subsequent close.

	•		For our direct lending funds, Total Assets Under Management inflows are reported at their gross value while, for certain funds, Fee-Earning Assets Under Management are reported as net assets, which is the basis on which fees are charged.

Offsetting these increases were:

	•		Realizations of $29.3 billion primarily driven by:

	o	$19.8 billion in our Real Estate segment driven by $14.5 billion from BREP and co-investment, $3.1 billion from BREIT, $1.3 billion from BPP and co-investment and $1.0 billion from BREDS,

	o	$5.6 billion in our Private Equity segment driven by $2.2 billion from Tactical Opportunities, $1.8 billion from Strategic Partners, and $1.3 billion from corporate private equity, and

	o	$3.4 billion in our Credit & Insurance segment driven by $1.4 billion from direct lending, $677.1 million from our energy strategies, $496.4 million from CLOs, $336.5 million from mezzanine funds and $237.6 million from stressed/distressed strategies.

Total Assets Under Management realizations in our Real Estate and Private Equity segments generally represents the total proceeds and typically exceeds the

Fee-Earning

Assets Under Management realizations which generally represents only the invested capital.

	•		Market activity of $19.3 billion primarily driven by:

	o	$8.6 billion of market depreciation in our Credit & Insurance segment driven by depreciation of $4.7 billion from certain liquid credit strategies, $976.1 million from private placement credit, $722.5 million from direct lending, $719.1 million from CLOs, $627.4 million from MLP strategies, $594.9 million from asset-based finance, $250.4 million from BIS, all of which included $1.8 billion of foreign exchange depreciation across the segment,

	o	$6.2 billion of market depreciation in our Private Equity segment driven by carrying value decreases in corporate private equity, BIP, Tactical Opportunities and BXG of 6.7%, 4.2%, 2.4% and 8.6%, respectively, partially offset by carrying value increases in Strategic Partners of 5.7%, all of which included $1.4 billion of foreign exchange depreciation across the segment,

	o	$3.3 billion of market depreciation in our Real Estate segment driven by carrying value decreases in BREDS and BREP and co-investment of 1.5% and 1.0%, respectively, partially offset by carrying value increases in Core+ real estate of 2.3%, all of which included $4.8 billion of foreign exchange depreciation across the segment, and

	o	$1.1 billion of market depreciation in our Hedge Fund Solutions segment driven by market activity within individual investor and specialized solutions.

Total Assets Under Management market activity in our Real Estate and Private Equity segments generally represents the change in fair value of the investments held and typically exceeds the

Fee-Earning

Assets Under Management market activity.

	•		Outflows of $14.4 billion primarily attributable to:

	o	$6.7 billion in our Credit & Insurance segment driven by $4.5 billion from certain liquid credit strategies, $990.3 million from BIS, $654.9 million from MLP strategies, $269.1 million from CLOs and $245.2 million from direct lending,

	o	$3.8 billion in our Real Estate segment driven by $2.9 billion from BREIT, $518.7 million from BPP and co-investment and $436.3 million from BREDS, and

	o	$3.3 billion in our Hedge Fund Solutions segment driven by $1.4 billion from commingled products, $1.1 billion from customized solutions and $711.3 million from individual investor and specialized solutions.

Total Assets Under Management were $940.8 billion at June 30, 2022, an increase of $59.9 billion, compared to $880.9 billion at December 31, 2021. The net increase was due to:

	•		Inflows of $138.1 billion primarily related to:

	o	$65.9 billion in our Real Estate segment driven by $28.9 billion from BREP and co-investment, $19.2 billion from BREIT, $11.5 billion from BPP and co-investment and $5.7 billion from BREDS,

	o	$36.7 billion in our Credit & Insurance segment driven by $25.2 billion from direct lending, $3.5 billion from CLOs, $2.7 billion from certain liquid credit strategies, $2.4 billion from asset-based finance, $1.5 billion from our energy strategies and $785.0 million from BIS,

	o	$29.5 billion in our Private Equity segment driven by $11.5 billion from corporate private equity, $5.8 billion from Strategic Partners, 5.6 billion from BIP, $3.1 billion from BXG, $2.3 billion from Tactical Opportunities and $1.1 billion from multi-asset products, and

	o	$6.0 billion in our Hedge Fund Solutions segment driven by $4.8 billion from individual investor and specialized solutions, $973.7 million from customized solutions and $251.6 million from commingled products.

Total Assets Under Management inflows may exceed

Fee-Earning

Assets Under Management inflows due to the reasons discussed above.

Offsetting these increases were:

	•		Realizations of $52.5 billion primarily driven by:

	o	$29.4 billion in our Real Estate segment driven by $20.2 billion from BREP and co-investment, $5.0 billion from BREIT, $2.1 billion from BPP and co-investment and $2.0 billion from BREDS,

	o	$13.3 billion in our Private Equity segment driven by $5.3 billion from corporate private equity, $4.2 billion from Strategic Partners, $3.1 billion from Tactical Opportunities and $493.5 million from BIP, and

	o	$8.9 billion in our Credit & Insurance segment driven by $4.2 billion from direct lending, $1.8 billion from CLOs, $1.1 billion from our energy strategies, $732.8 million from stressed/distressed strategies and $673.3 million from mezzanine funds.

Total Assets Under Management realizations in our Real Estate and Private Equity segments generally represents the total proceeds and typically exceeds the

Fee-Earning

Assets Under Management realizations which generally represents only the invested capital.

	•		Outflows of $24.4 billion primarily attributable to:

	o	$10.2 billion in our Credit & Insurance segment driven by $5.9 billion from certain liquid credit strategies, $1.7 billion from MLP strategies, $1.3 billion from BIS and $653.4 million from direct lending,

	o	$6.1 billion in our Real Estate segment driven by $4.2 billion from BREIT, $1.4 billion from BPP and co-investment and $530.3 million from BREDS,

	o	$6.0 billion in our Hedge Fund Solutions segment driven by $3.2 billion from customized solutions, $1.5 billion from commingled products and $1.3 billion from individual investor and specialized solutions, and

	o	$2.0 billion in our Private Equity segment driven by $548.3 million from Tactical Opportunities, $433.9 million from Strategic Partners, $428.6 million from multi-asset products and $352.8 million from corporate private equity.

	•		Market activity of $1.3 billion primarily driven by:

	o	$11.4 billion of market depreciation in our Credit & Insurance segment driven by depreciation of $7.9 billion from certain liquid credit strategies, $2.2 billion from private placement credit, $1.1 billion from asset-based finance and $918.7 million from CLOs, partially offset by market appreciation of $1.1 billion from MLP strategies, all of which included $2.2 billion of foreign exchange depreciation across the segment, and

	o	Partially offset by $10.2 billion of market appreciation in our Real Estate segment driven by carrying value increases in Core+ real estate and BREP and co-investment of 9.8% and 9.1%, respectively, partially offset by carrying value decreases in BREDS of 0.4%, all of which included $6.7 billion of foreign exchange depreciation across the segment.

Total Assets Under Management market activity in our Real Estate and Private Equity segments generally represents the change in fair value of the investments held and typically exceeds the

Fee-Earning

Assets Under Management market activity.

Dry Powder

The following presents our Dry Powder as of quarter end of each period:

Note:	Totals may not add due to rounding.

(a)	Represents illiquid drawdown funds, a component of Perpetual Capital and fee-paying co-investments; includes fee-paying third party capital as well as general partner and employee capital that does not earn fees. Amounts are reduced by outstanding capital commitments, for which capital has not yet been invested.

Net Accrued Performance Revenues

The following table presents the Accrued Performance Revenues, net of performance compensation, of the Blackstone Funds as of June 30, 2022 and 2021. Net Accrued Performance Revenues presented do not include clawback amounts, if any, which are disclosed in Note 17. “Commitments and Contingencies — Contingencies — Contingent Obligations (Clawback)” in the “Notes to Condensed Consolidated Financial Statements” in “Part I. Item 1. Financial Statements” of this filing. See “—

Non-GAAP

Financial Measures” for our reconciliation of Net Accrued Performance Revenues.

		June 30,
		2022				2021
		(Dollars in Millions)
Real Estate
BREP IV		$	7			$	19
BREP V			3				26
BREP VI			32				42
BREP VII			164				300
BREP VIII			841				626
BREP IX			1,015				359
BREP Europe IV			83				89
BREP Europe V			120				312
BREP Europe VI			80				60
BREP Asia I			114				107
BREP Asia II			153				98
BPP			755				265
BREIT			—				247
BREDS			15				32
BTAS			111				6
Total Real Estate (a)			3,491				2,591
Private Equity
BCP IV			8				9
BCP V			3				39
BCP VI			407				740
BCP VII			975				1,351
BCP VIII			235				89
BCP Asia I			195				213
BEP I			27				28
BEP III			76				47
BCEP I			224				170
Tactical Opportunities			311				374
BXG			—				59
Strategic Partners			629				262
BIP			67				81
BXLS			24				23
BTAS/Other			228				151
Total Private Equity (a)			3,408				3,637
Hedge Fund Solutions			305				300
Credit & Insurance			271				233
Total Blackstone Net Accrued Performance Revenues		$	7,476			$	6,761

Note:	Totals may not add due to rounding.

(a)	Real Estate and Private Equity include co-investments, as applicable.

For the twelve months ended June 30, 2022, Net Accrued Performance Revenues receivable increased due to Net Performance Revenues of $6.0 billion offset by net realized distributions of $5.3 billion.

Invested Performance Eligible Assets Under Management

The following presents our Invested Performance Eligible Assets Under Management as of quarter end for each period:

Note:	Totals may not add due to rounding.

Perpetual Capital

The following presents our Perpetual Capital Total Assets Under Management as of quarter end for each period:

Note:	Totals may not add due to rounding.

Perpetual Capital Total Assets Under Management were $355.9 billion as of June 30, 2022, an increase of $17.8 billion, compared to $338.2 billion as of March 31, 2022. Perpetual Capital Total Assets Under Management in our Real Estate, Credit & Insurance and Private Equity segments increased $12.6 billion, $3.2 billion and $2.4 billion, respectively. Principal drivers of these increases were:

	•		In our Real Estate segment, net Total Assets Under Management growth in BREIT and BPP and co-investment resulted in increases of $5.0 billion and $7.7 billion, respectively.

	•		In our Credit & Insurance segment, net Total Assets Under Management growth in direct lending resulted in an increase of $8.9 billion, partially offset by a decrease of $5.6 billion related to BIS.

	•		In our Private Equity segment, net Total Assets Under Management growth in BIP resulted in an increase of $2.3 billion.

Perpetual Capital Total Assets Under Management were $355.9 billion as of June 30, 2022, an increase of $42.6 billion, or 14%, compared to $313.4 billion as of December 31, 2021. Perpetual Capital Total Assets Under Management in our Real Estate, Credit & Insurance and Private Equity segments increased $28.1 billion, $8.0 billion and $6.6 billion, respectively. Principal drivers of these increases were:

	•		In our Real Estate segment, net Total Assets Under Management growth in BREIT and BPP and co-investment resulted in increases of $14.2 billion and $12.8 billion, respectively.

	•		In our Credit & Insurance segment, net Total Assets Under Management growth in direct lending resulted in an increase of $18.3 billion, partially offset by a decrease of $10.1 billion related to BIS.

	•		In our Private Equity segment, net Total Assets Under Management growth in BIP resulted in an increase of $6.7 billion.

Investment Records

Fund returns information for our significant funds is included throughout this discussion and analysis to facilitate an understanding of our results of operations for the periods presented. The fund returns information reflected in this discussion and analysis is not indicative of the financial performance of Blackstone and is also not necessarily indicative of the future performance of any particular fund. An investment in Blackstone is not an investment in any of our funds. There can be no assurance that any of our funds or our other existing and future funds will achieve similar returns.

The following table presents the investment record of our significant carry/drawdown funds and selected perpetual capital strategies from inception through June 30, 2022:

						Unrealized Investments										Realized Investments						Total Investments
Fund (Investment Period		Committed		Available								%																Net IRRs (d)
Beginning Date / Ending Date) (a)		Capital		Capital (b)		Value		MOIC (c)				Public				Value		MOIC (c)				Value		MOIC (c)				Realized				Total
		(Dollars/Euros in Thousands, Except Where Noted)
Real Estate
Pre-BREP		$ 140,714		$ —		$ —			n/a				—			$ 345,190			2.5x			$ 345,190			2.5x				33	%			33	%
BREP I (Sep 1994 / Oct 1996)		380,708		—		—			n/a				—			1,327,708			2.8x			1,327,708			2.8x				40	%			40	%
BREP II (Oct 1996 / Mar 1999)		1,198,339		—		—			n/a				—			2,531,614			2.1x			2,531,614			2.1x				19	%			19	%
BREP III (Apr 1999 / Apr 2003)		1,522,708		—		—			n/a				—			3,330,406			2.4x			3,330,406			2.4x				21	%			21	%
BREP IV (Apr 2003 / Dec 2005)		2,198,694		—		23,471			n/a				—			4,640,501			1.7x			4,663,972			1.7x				12	%			12	%
BREP V (Dec 2005 / Feb 2007)		5,539,418		—		7,046			n/a				—			13,450,289			2.3x			13,457,335			2.3x				11	%			11	%
BREP VI (Feb 2007 / Aug 2011)		11,060,444		550,447		347,417			2.0x				79	%		27,454,501			2.5x			27,801,918			2.5x				13	%			13	%
BREP VII (Aug 2011 / Apr 2015)		13,501,376		1,513,399		3,574,239			0.9x				7	%		27,931,757			2.4x			31,505,996			2.0x				22	%			15	%
BREP VIII (Apr 2015 / Jun 2019)		16,592,792		2,302,626		15,233,276			1.7x				—			21,102,039			2.6x			36,335,315			2.1x				28	%			18	%
*BREP IX (Jun 2019 / Dec 2024)		21,492,844		7,400,820		23,129,782			1.7x				1	%		7,308,322			2.2x			30,438,104			1.8x				66	%			40	%
BREP X (TBD)		24,416,257		24,416,257		—			n/a				—			—			n/a			—			n/a				n/a				n/a
Total Global BREP		$ 98,044,294		$ 36,183,549		$ 42,315,231			1.6x				2	%		$ 109,422,327			2.4x			$ 151,737,558			2.1x				18	%			17	%
BREP Int’l (Jan 2001 / Sep 2005)		€ 824,172		€ —		€ —			n/a				—			€ 1,373,170			2.1x			€ 1,373,170			2.1x				23	%			23	%
BREP Int’l II (Sep 2005 / Jun 2008) (e)		1,629,748		—		—			n/a				—			2,583,032			1.8x			2,583,032			1.8x				8	%			8	%
BREP Europe III (Jun 2008 / Sep 2013)		3,205,318		428,342		261,685			0.5x				—			5,792,216			2.4x			6,053,901			2.0x				19	%			14	%
BREP Europe IV (Sep 2013 / Dec 2016)		6,673,049		1,419,267		1,824,144			1.3x				—			9,725,105			2.0x			11,549,249			1.8x				20	%			13	%
BREP Europe V (Dec 2016 / Oct 2019)		7,965,079		1,381,611		5,884,481			1.1x				—			6,462,442			4.1x			12,346,923			1.8x				43	%			14	%
*BREP Europe VI (Oct 2019 / Apr 2025)		9,907,845		6,534,038		4,463,598			1.3x				—			3,264,144			2.6x			7,727,742			1.6x				75	%			28	%
Total BREP Europe		€ 30,205,211		€ 9,763,258		€ 12,433,908			1.2x				—			€ 29,200,109			2.4x			€ 41,634,017			1.8x				17	%			13	%

continued...

						Unrealized Investments										Realized Investments						Total Investments
Fund (Investment Period		Committed		Available								%																Net IRRs (d)
Beginning Date / Ending Date) (a)		Capital		Capital (b)		Value		MOIC (c)				Public				Value		MOIC (c)				Value		MOIC (c)				Realized				Total
		(Dollars/Euros in Thousands, Except Where Noted)
Real Estate (continued)
BREP Asia I (Jun 2013 / Dec 2017)		$ 4,261,983		$ 917,133		$ 2,326,971			1.5x				11	%		$ 6,243,752			2.1x			$ 8,570,723			1.9x				20	%			13	%
BREP Asia II (Dec 2017 / Mar 2022)		7,360,069		1,643,769		7,394,631			1.3x				—			735,246			1.8x			8,129,877			1.3x				48	%			10	%
*BREP Asia III (Mar 2022 / Sep 2027)		7,939,534		7,171,611		764,873			1.0x				—			—			n/a			764,873			1.0x				n/a				n/m
BREP Co-Investment (f)		7,208,976		38,835		956,619			2.3x				—			15,039,293			2.2x			15,995,912			2.2x				16	%			16	%
Total BREP		$ 160,791,446		$ 56,190,696		$ 68,077,191			1.4x				2	%		$ 167,160,041			2.4x			$ 235,237,232			2.0x				17	%			16	%
*BREDS High-Yield (Various) (g)		$ 20,003,798		$ 5,631,946		$ 5,272,920			1.0x				—			$ 16,158,336			1.3x			$ 21,431,256			1.2x				10	%			10	%
Private Equity
Corporate Private Equity
BCP I (Oct 1987 / Oct 1993)		$ 859,081		$ —		$ —			n/a				—			$ 1,741,738			2.6x			$ 1,741,738			2.6x				19	%			19	%
BCP II (Oct 1993 / Aug 1997)		1,361,100		—		—			n/a				—			3,256,819			2.5x			3,256,819			2.5x				32	%			32	%
BCP III (Aug 1997 / Nov 2002)		3,967,422		—		—			n/a				—			9,184,688			2.3x			9,184,688			2.3x				14	%			14	%
BCOM (Jun 2000 / Jun 2006)		2,137,330		24,575		15,234			n/a				—			2,953,649			1.4x			2,968,883			1.4x				6	%			6	%
BCP IV (Nov 2002 / Dec 2005)		6,773,182		167,384		128,418			1.3x				—			21,479,599			2.9x			21,608,017			2.8x				36	%			36	%
BCP V (Dec 2005 / Jan 2011)		21,009,112		1,035,259		112,877			7.6x				92	%		38,427,169			1.9x			38,540,046			1.9x				8	%			8	%
BCP VI (Jan 2011 / May 2016)		15,195,678		1,371,459		6,778,103			1.7x				36	%		24,354,324			2.2x			31,132,427			2.1x				17	%			12	%
BCP VII (May 2016 / Feb 2020)		18,856,429		1,934,706		22,565,824			1.7x				32	%		10,172,064			2.4x			32,737,888			1.8x				36	%			16	%
*BCP VIII (Feb 2020 / Feb 2026)		25,425,302		16,245,056		12,531,080			1.4x				10	%		517,592			2.9x			13,048,672			1.4x				123	%			25	%
BCP IX (TBD)		8,774,458		8,774,458		—			n/a				—			—			n/a			—			n/a				n/a				n/a
Energy I (Aug 2011 / Feb 2015)		2,441,558		174,492		616,487			1.6x				45	%		3,988,731			2.0x			4,605,218			1.9x				13	%			12	%
Energy II (Feb 2015 / Feb 2020)		4,935,906		1,033,151		4,836,068			1.7x				52	%		2,015,804			1.2x			6,851,872			1.5x				2	%			8	%
*Energy III (Feb 2020 / Feb 2026)		4,322,015		2,664,851		2,369,680			1.6x				39	%		342,423			2.9x			2,712,103			1.7x				113	%			41	%
BCP Asia I (Dec 2017 / Sep 2021)		2,452,948		869,236		3,387,455			2.2x				54	%		1,024,467			4.9x			4,411,922			2.5x				109	%			41	%
*BCP Asia II (Sep 2021 / Sep 2027)		6,554,765		6,499,684		(37,515)			n/a				—			—			n/a			(37,515)			n/a				n/a				n/a
Core Private Equity I (Jan 2017 / Mar 2021) (h)		4,764,447		1,149,384		8,047,555			2.1x				—			2,031,090			3.7x			10,078,645			2.3x				52	%			25	%
*Core Private Equity II (Mar 2021 / Mar 2026) (h)		8,190,362		6,738,547		1,530,541			1.1x				—			—			n/a			1,530,541			1.1x				n/a				n/m
Total Corporate Private Equity		$ 138,021,095		$ 48,682,242		$ 62,881,807			1.6x				27	%		$ 121,490,157			2.2x			$ 184,371,964			2.0x				16	%			15	%

continued...

						Unrealized Investments										Realized Investments						Total Investments
Fund (Investment Period		Committed		Available								%																Net IRRs (d)
Beginning Date / Ending Date) (a)		Capital		Capital (b)		Value		MOIC (c)				Public				Value		MOIC (c)				Value		MOIC (c)				Realized				Total
		(Dollars/Euros in Thousands, Except Where Noted)
Private Equity (continued)
Tactical Opportunities
*Tactical Opportunities (Various)		$ 22,502,048		$ 6,729,103		$ 13,244,038			1.3x				10	%		$ 19,204,237			1.9x			$ 32,448,275			1.6x				17	%			12	%
*Tactical Opportunities Co-Investment and Other (Various)		15,074,572		6,426,962		4,901,464			1.9x				7	%		7,985,975			1.6x			12,887,439			1.7x				18	%			19	%
Total Tactical Opportunities		$ 37,576,620		$ 13,156,065		$ 18,145,502			1.4x				9	%		$ 27,190,212			1.8x			$ 45,335,714			1.6x				18	%			14	%
Growth
*BXG I (Jul 2020 / Jul 2025)		$ 5,046,626		$ 1,560,759		$ 3,404,666			1.0x				7	%		$ 349,310			3.2x			$ 3,753,976			1.1x				n/m				2	%
BXG II (TBD)		2,724,745		2,724,745		—			n/a				—			—			n/a			—			n/a				n/a				n/a
Total Growth		$ 7,771,371		$ 4,285,504		$ 3,404,666			1.0x				7	%		$ 349,310			3.2x			$ 3,753,976			1.1x				n/m				2	%
Strategic Partners (Secondaries)
Strategic Partners I-V (Various) (i)		$ 11,447,898		$ 841,025		$ 462,891			n/a				—			$ 16,884,082			n/a			$ 17,346,973			1.7x				n/a				13	%
Strategic Partners VI (Apr 2014 / Apr 2016) (i)		4,362,750		1,481,621		1,187,348			n/a				—			3,983,862			n/a			5,171,210			1.7x				n/a				15	%
Strategic Partners VII (May 2016 / Mar 2019) (i)		7,489,970		1,864,053		5,287,041			n/a				—			5,467,940			n/a			10,754,981			2.1x				n/a				22	%
Strategic Partners Real Assets II (May 2017 / Jun 2020) (i)		1,749,807		521,624		1,114,775			n/a				—			968,153			n/a			2,082,928			1.5x				n/a				17	%
Strategic Partners VIII (Mar 2019 / Oct 2021) (i)		10,763,600		5,136,286		9,537,790			n/a				—			4,601,030			n/a			14,138,820			1.9x				n/a				50	%
*Strategic Partners Real Estate, SMA and Other (Various) (i)		8,651,148		2,985,524		3,414,860			n/a				—			3,000,632			n/a			6,415,492			1.6x				n/a				19	%
*Strategic Partners Infra III (Jun 2020 / Jul 2024) (i)		3,250,100		2,053,491		715,816			n/a				—			124,956			n/a			840,772			1.7x				n/a				80	%
*Strategic Partners IX (Oct 2021 / Jul 2026) (i)		14,865,033		10,241,936		3,075,626			n/a				—			44,826			n/a			3,120,452			1.5x				n/a				n/m
Total Strategic Partners (Secondaries)		$ 62,580,306		$ 25,125,560		$ 24,796,147			n/a				—			$ 35,075,481			n/a			$ 59,871,628			1.8x				n/a				16	%
Life Sciences
Clarus IV (Jan 2018 / Jan 2020)		$ 910,000		$ 18,801		$ 841,386			1.6x				1	%		$ 239,712			1.9x			$ 1,081,098			1.6x				23	%			15	%
*BXLS V (Jan 2020 / Jan 2025)		4,839,395		2,112,416		1,130,149			1.3x				-3	%		71,549			1.3x			1,201,698			1.3x				n/a				1	%

continued...

						Unrealized Investments										Realized Investments						Total Investments
Fund (Investment Period		Committed		Available								%																Net IRRs (d)
Beginning Date / Ending Date) (a)		Capital		Capital (b)		Value		MOIC (c)				Public				Value		MOIC (c)				Value		MOIC (c)				Realized				Total
		(Dollars/Euros in Thousands, Except Where Noted)
Credit
Mezzanine / Opportunistic I (Jul 2007 / Oct 2011)		$ 2,000,000		$ 97,114		$ 19,012			1.5x				—			$ 4,786,397			1.6x			$ 4,805,409			1.6x				n/a				17	%
Mezzanine / Opportunistic II (Nov 2011 / Nov 2016)		4,120,000		998,263		283,280			0.3x				—			6,493,270			1.6x			6,776,550			1.4x				n/a				10	%
Mezzanine / Opportunistic III (Sep 2016 / Jan 2021)		6,639,133		913,019		4,109,350			1.1x				—			5,170,802			1.6x			9,280,152			1.3x				n/a				10	%
*Mezzanine / Opportunistic IV (Jan 2021 / Jan 2026)		5,016,771		3,617,845		1,470,872			1.0x				—			43,818			n/m			1,514,690			1.1x				n/a				11	%
Stressed / Distressed I (Sep 2009 / May 2013)		3,253,143		76,000		—			n/a				—			5,777,098			1.3x			5,777,098			1.3x				n/a				9	%
Stressed / Distressed II (Jun 2013 / Jun 2018)		5,125,000		547,430		316,235			0.4x				—			5,238,819			1.2x			5,555,054			1.1x				n/a				—
*Stressed / Distressed III (Dec 2017 / Dec 2022)		7,356,380		2,882,714		2,508,295			1.0x				—			2,457,462			1.4x			4,965,757			1.1x				n/a				8	%
Energy I (Nov 2015 / Nov 2018)		2,856,867		1,057,173		749,525			0.9x				—			2,576,126			1.7x			3,325,651			1.4x				n/a				9	%
*Energy II (Feb 2019 / Feb 2024)		3,616,081		2,191,422		1,615,733			1.1x				—			983,485			1.4x			2,599,218			1.2x				n/a				23	%
European Senior Debt I (Feb 2015 / Feb 2019)		€ 1,964,689		€ 331,263		€ 1,011,622			0.9x				—			€ 2,271,934			1.4x			€ 3,283,556			1.2x				n/a				5	%
*European Senior Debt II (Jun 2019 / Jun 2024)		€ 4,088,344		€ 1,682,646		€ 3,801,389			1.0x				—			€ 1,253,154			1.5x			€ 5,054,543			1.1x				n/a				15	%
Total Credit Drawdown Funds (j)		$ 46,889,033		$ 14,486,437		$ 16,104,065			0.9x				—			$ 37,558,519			1.5x			$ 53,662,584			1.3x				n/a				10	%

Selected Perpetual Capital Strategies (k)

Fund (Inception Year) (a)		Investment Strategy				Total AUM				Total Net Return (l)
		(Dollars in Thousands, Except Where Noted)
Real Estate
BPP - Blackstone Property Partners (2013) (m)			Core+ Real Estate			$	73,817,041				12	%
BREIT - Blackstone Real Estate Income Trust (2017) (n)			Core+ Real Estate				68,281,628				13	%
BXMT - Blackstone Mortgage Trust (2013) (o)			Real Estate Debt				7,277,274				9	%
Private Equity
BIP - Blackstone Infrastructure Partners (2019) (p)			Infrastructure				24,538,314				17	%
Hedge Fund Solutions
BSCH - Blackstone Strategic Capital Holdings (2014) (q)			GP Stakes				10,245,103				16	%
Credit
BXSL - Blackstone Secured Lending Fund (2018) (r)			U.S. Direct Lending				10,691,421				10	%
BCRED - Blackstone Private Credit Fund (2021) (s)			U.S. Direct Lending				53,085,115				8	%

The returns presented herein represent those of the applicable Blackstone Funds and not those of Blackstone.

n/m	Not meaningful generally due to the limited time since initial investment.

n/a	Not applicable.

SMA	Separately managed account.

*	Represents funds that are currently in their investment period.

(a)	Excludes investment vehicles where Blackstone does not earn fees.

(b)	Available Capital represents total investable capital commitments, including side-by-side, adjusted for certain expenses and expired or recallable capital and may include leverage, less invested capital. This amount is not reduced by outstanding commitments to investments.

(c)	Multiple of Invested Capital (“MOIC”) represents carrying value, before management fees, expenses and Performance Revenues, divided by invested capital.

(d)

Unless otherwise indicated, Net Internal Rate of Return (“IRR”) represents the annualized inception to June 30, 2022 IRR on total invested capital based on realized proceeds and unrealized value, as applicable, after management fees, expenses and Performance Revenues. IRRs are calculated using actual timing of limited partner cash flows. Initial inception date of cash flows may differ from the Investment Period Beginning Date.

(e)	The 8% Realized Net IRR and 8% Total Net IRR exclude investors that opted out of the Hilton investment opportunity. Overall BREP International II performance reflects a 7% Realized Net IRR and a 7% Total Net IRR.

(f)	BREP Co-Investment represents co-investment capital raised for various BREP investments. The Net IRR reflected is calculated by aggregating each co-investment’s realized proceeds and unrealized value, as applicable, after management fees, expenses and Performance Revenues.

(g)	BREDS High-Yield represents the flagship real estate debt drawdown funds only.

(h)	Blackstone Core Equity Partners is a core private equity strategy which invests with a more modest risk profile and longer hold period than traditional private equity.

(i)	Realizations are treated as return of capital until fully recovered and therefore unrealized and realized MOICs are not applicable. Returns are calculated from results that are reported on a three month lag from Strategic Partners’ fund financial statements and therefore do not include the impact of economic and market activities in the current quarter.

(j)	Funds presented represent the flagship credit drawdown funds only. The Total Credit Net IRR is the combined IRR of the credit drawdown funds presented.

(k)	Represents the performance for select Perpetual Capital Strategies; strategies excluded consist primarily of (1) investment strategies that have been investing for less than one year, (2) most perpetual capital assets managed for insurance clients, and (3) investment vehicles where Blackstone does not earn fees.

(l)	Unless otherwise indicated, Total Net Return represents the annualized inception to June 30, 2022 IRR on total invested capital based on realized proceeds and unrealized value, as applicable, after management fees, expenses and Performance Revenues. IRRs are calculated using actual timing of investor cash flows. Initial inception date of cash flows occurred during the Inception Year.

(m)	BPP includes certain vehicles managed as part of the BPP Platform but not classified as Perpetual Capital. As of June 30, 2022, these vehicles represented $3.2 billion of Total Assets Under Management.

(n)

The BREIT Total Net Return reflects a per share blended return, assuming BREIT had a single share class, reinvestment of all dividends received during the period, and no upfront selling commission, net of all fees and expenses incurred by BREIT. These returns are not representative of the returns experienced by any particular investor or share class. Total Net Returns are presented on an annualized basis and are from January 1, 2017.

(o)	The BXMT return reflects annualized market return of a shareholder invested in BXMT since inception through June 30, 2022, assuming reinvestment of all dividends received during the period. Return incorporates the closing NYSE stock price as of June 30, 2022. Total Net Return is from May 22, 2013.

(p)	Including co-investment vehicles that do not pay fees, BIP Total Assets Under Management is $29.7 billion.

(q)

BSCH represents the aggregate Total Assets Under Management and Total Net Return of BSCH I and BSCH II funds that invest as part of the GP Stakes strategy, which targets minority investments in the general partners of private equity and other private-market alternative asset management firms globally. Including co-investment vehicles that do not pay fees, BSCH Total Assets Under Management is $11.1 billion.

(r)

The BXSL Total Assets Under Management and Total Net Return are presented as of March 31, 2022. BXSL Total Net Return reflects the change in NAV per share, plus distributions per share (assuming dividends and distributions are reinvested in accordance with BXSL’s dividend reinvestment plan) divided by the beginning NAV per share. Total Net Returns are presented on an annualized basis and are from November 20, 2018.

(s)

The BCRED Total Net Return reflects a per share blended return, assuming BCRED had a single share class, reinvestment of all dividends received during the period, and no upfront selling commission, net of all fees and expenses incurred by BCRED. These returns are not representative of the returns experienced by any particular investor or share class. Total Net Returns are presented on an annualized basis and are from January 7, 2021. Total Assets Under Management reflects gross asset value plus amounts borrowed or available to be borrowed under certain credit facilities. BCRED net asset value as of June 30, 2022 was $21.0 billion.

Segment Analysis

Discussed below is our Segment Distributable Earnings for each of our segments. This information is reflected in the manner utilized by our senior management to make operating decisions, assess performance and allocate resources. References to “our” sectors or investments may also refer to portfolio companies and investments of the underlying funds that we manage.

Real Estate

The following table presents the results of operations for our Real Estate segment:

		Three Months Ended																Six Months Ended
		June 30,								2022 vs. 2021								June 30,								2022 vs. 2021
		2022				2021				$				%				2022				2021				$				%
		(Dollars in Thousands)
Management Fees, Net
Base Management Fees		$	611,751			$	453,664			$	158,087				35	%		$	1,191,937			$	880,850			$	311,087				35	%
Transaction and Other Fees, Net			46,974				38,080				8,894				23	%			87,459				64,099				23,360				36	%
Management Fee Offsets			(689	)			(493	)			(196	)			40	%			(1,649	)			(2,116	)			467				-22	%
Total Management Fees, Net			658,036				491,251				166,785				34	%			1,277,747				942,833				334,914				36	%
Fee Related Performance Revenues			265,507				33,776				231,731				686	%			757,024				189,168				567,856				300	%
Fee Related Compensation			(273,893	)			(121,957	)			(151,936	)			125	%			(618,735	)			(310,449	)			(308,286	)			99	%
Other Operating Expenses			(88,329	)			(54,760	)			(33,569	)			61	%			(154,332	)			(99,122	)			(55,210	)			56	%
Fee Related Earnings			561,321				348,310				213,011				61	%			1,261,704				722,430				539,274				75	%
Realized Performance Revenues			1,997,720				351,053				1,646,667				469	%			2,800,636				439,691				2,360,945				537	%
Realized Performance Compensation			(831,402	)			(154,928	)			(676,474	)			437	%			(1,121,433	)			(177,690	)			(943,743	)			531	%
Realized Principal Investment Income			29,116				28,129				987				4	%			83,091				128,949				(45,858	)			-36	%
Net Realizations			1,195,434				224,254				971,180				433	%			1,762,294				390,950				1,371,344				351	%
Segment Distributable Earnings		$	1,756,755			$	572,564			$	1,184,191				207	%		$	3,023,998			$	1,113,380			$	1,910,618				172	%

n/m Not meaningful.

Three Months Ended June 30, 2022 Compared to Three Months Ended June 30, 2021

Segment Distributable Earnings were $1.8 billion for the three months ended June 30, 2022, an increase of $1.2 billion, or 207%, compared to $572.6 million for the three months ended June 30, 2021. The increase in Segment Distributable Earnings was attributable to increases of $213.0 million in Fee Related Earnings and $971.2 million in Net Realizations.

Segment Distributable Earnings in our Real Estate segment in the second quarter of 2022 were higher compared to the second quarter of 2021. This was primarily driven by increased Net Realizations due to higher Realized Performance Revenues in BREP, as well as increased Fee Related Earnings due to the quarterly crystallization of BREIT performance revenues and growth in

Fee-Earning

Assets Under Management in Core+ real estate and BREDS. Perpetual capital strategies, including certain retail strategies such as BREIT, represent an increasing percentage of our Total Assets Under Management in our Real Estate segment. While in the second quarter we experienced meaningful net inflows, fundraising in our retail strategies moderated and market volatility and investor liquidity needs led to an increase in repurchase requests driven by Asia-based investors. A worsening, or potentially a continuation, of this challenging market environment would adversely affect our net flows in the near term. We believe the long-term trends remain positive, however, with compelling performance, continued inflows, and well-disclosed liquidity and structural protections.

Despite significant market volatility globally, including as a result of the high rate of inflation and escalating interest rates, our real estate business is demonstrating fundamental strength. Select areas, however, are continuing to see challenges. The hospitality sector is experiencing a material growth in wages, but has also benefitted from high demand in travel and the inflationary environment. Our real estate strategies have generally oriented their portfolios in sectors and markets, such as rental housing and logistics, that are better insulated from inflationary pressures because of opportunities for stronger relative cash flow growth. Moreover, our real estate

strategies have focused on assets with shorter duration leases, which provide more opportunity to capture growth in an inflationary environment. As a result, such investments have largely been able to offset the pressure of rising inflation and interest rates. Nonetheless, portions of our real estate portfolio have exposure to long-term leases which may be more exposed to rising inflation and interest rates. Additionally, in the second half of 2022 and beyond inflation could be higher than generally anticipated. This is likely to contribute to more significant interest rate hikes and market volatility, which may lead to downward pressure on the value of our real estate portfolio. These factors, in combination with continued uncertainty and a difficult market environment, are likely to lead to muted realizations for some time. See “Part I. Item 1A. Risk Factors — Risks Related to Our Business — Difficult market and geopolitical conditions can adversely affect our business in many ways, each of which could materially reduce our revenue, earnings and cash flow and adversely affect our financial prospects and condition” and “— A period of economic slowdown, which may be across one or more industries, sectors or geographies, has contributed and could in the future contribute to adverse operating performance for certain of our funds’ investments, which would adversely affect our operating results and cash flows” in our Annual Report on Form

10-K

for the year ended December 31, 2021.

Fee Related Earnings

Fee Related Earnings were $561.3 million for the three months ended June 30, 2022, an increase of $213.0 million, or 61%, compared to $348.3 million for the three months ended June 30, 2021. The increase in Fee Related Earnings was primarily attributable to increases of $231.7 million in Fee Related Performance Revenues and $166.8 million in Management Fees, Net, partially offset by increases of $151.9 million in Fee Related Compensation and $33.6 million in Other Operating Expenses.

Fee Related Performance Revenues were $265.5 million for the three months ended June 30, 2022, an increase of $231.7 million, compared to $33.8 million for the three months ended June 30, 2021. The increase was primarily due to the crystallization of BREIT performance revenues, which, beginning in the three months ended March 31, 2022, crystallizes on a quarterly basis in lieu of annually.

Management Fees, Net were $658.0 million for the three months ended June 30, 2022, an increase of $166.8 million, compared to $491.3 million for the three months ended June 30, 2021, primarily driven by an increase in Base Management Fees. Base Management Fees increased $158.1 million primarily due to

Fee-Earning

Assets Under Management growth in Core+ real estate.

Fee Related Compensation was $273.9 million for the three months ended June 30, 2022, an increase of $151.9 million, compared to $122.0 million for the three months ended June 30, 2021. The increase was primarily due to an increase in Fee Related Performance Revenues and Management Fees, Net, on which a portion of Fee Related Compensation is based.

Other Operating Expenses were $88.3 million for the three months ended June 30, 2022, an increase of $33.6 million, compared to $54.8 million for the three months ended June 30, 2021. The increase was primarily due to travel and entertainment, occupancy and technology related expenses, and professional fees.

Net Realizations

Net Realizations were $1.2 billion for the three months ended June 30, 2022, an increase of $971.2 million, or 433%, compared to $224.3 million for the three months ended June 30, 2021. The increase in Net Realizations was attributable to an increase of $1.6 billion in Realized Performance Revenues, partially offset by an increase of $676.5 million in Realized Performance Compensation.

Realized Performance Revenues were $2.0 billion for the three months ended June 30, 2022, an increase of $1.6 billion, compared to $351.1 million for the three months ended June 30, 2021. The increase was primarily due to higher Realized Performance Revenues in BREP.

Realized Performance Compensation was $831.4 million for the three months ended June 30, 2022, an increase of $676.5 million, compared to $154.9 million for the three months ended June 30, 2021. The increase was primarily due to the increase in Realized Performance Revenues.

Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021

Segment Distributable Earnings were $3.0 billion for the six months ended June 30, 2022, an increase of $1.9 billion, or 172%, compared to $1.1 billion for the six months ended June 30, 2021. The increase in Segment Distributable Earnings was attributable to increases of $539.3 million in Fee Related Earnings and $1.4 billion in Net Realizations.

Fee Related Earnings

Fee Related Earnings were $1.3 billion for the six months ended June 30, 2022, an increase of $539.3 million, or 75%, compared to $722.4 million for the six months ended June 30, 2021. The increase in Fee Related Earnings was attributable to increases of $567.9 million in Fee Related Performance Revenues and $334.9 million in Management Fees, Net, partially offset by increases of $308.3 million in Fee Related Compensation and $55.2 million in Other Operating Expenses.

Fee Related Performance Revenues were $757.0 million for the six months ended June 30, 2022, an increase of $567.9 million, compared to $189.2 million for the six months ended June 30, 2021. The increase was primarily due to the crystallization of BREIT performance revenues, which, beginning in the three months ended March 31, 2022, crystallizes on a quarterly basis in lieu of annually.

Management Fees, Net were $1.3 billion for the six months ended June 30, 2022, an increase of $334.9 million, compared to $942.8 million for the six months ended June 30, 2021, primarily driven by an increase in Base Management Fees. Base Management Fees increased $311.1 million primarily due to

Fee-Earning

Assets Under Management growth in Core+ real estate and BREDS.

The annualized Base Management Fee Rate decreased from 1.12% at June 30, 2021 to 1.00% at June 30, 2022. The decrease was primarily due to growth in BREDS insurance vehicles, which have a lower management fee rate.

Fee Related Compensation was $618.7 million for the six months ended June 30, 2022, an increase of $308.3 million, compared to $310.4 million for the six months ended June 30, 2021. The increase was primarily due to an increase in Fee Related Performance Revenues and Management Fees, Net, on which a portion of Fee Related Compensation is based.

Other Operating Expenses were $154.3 million for the six months ended June 30, 2022, an increase of $55.2 million, compared to $99.1 million for the six months ended June 30, 2021. The increase was primarily due to travel and entertainment, occupancy and technology related expenses, and professional fees.

Net Realizations

Net Realizations were $1.8 billion for the six months ended June 30, 2022, an increase of $1.4 billion, or 351%, compared to $391.0 million for the six months ended June 30, 2021. The increase in Net Realizations was attributable to an increase of $2.4 billion in Realized Performance Revenues, partially offset by an increase of $943.7 million in Realized Performance Compensation and a decrease of $45.9 million in Realized Principal Investment Income.

Realized Performance Revenues were $2.8 billion for the six months ended June 30, 2022, an increase of $2.4 billion, compared to $439.7 million for the six months ended June 30, 2021. The increase was primarily due to higher Realized Performance Revenues in BREP.

Realized Performance Compensation was $1.1 billion for the six months ended June 30, 2022, an increase of $943.7 million, compared to $177.7 million for the six months ended June 30, 2021. The increase was primarily due to the increase in Realized Performance Revenues.

Realized Principal Investment Income was $83.1 million for the six months ended June 30, 2022, a decrease of $45.9 million, compared to $128.9 million for the six months ended June 30, 2021. The decrease was primarily due to the segment’s allocation of the gain recognized in connection with the Pátria Sale Transaction during the three months ended March 31, 2021. For additional information, see “— Consolidated Results of Operations — Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021

— Revenues.”

Fund Returns

Fund return information for our significant funds is included throughout this discussion and analysis to facilitate an understanding of our results of operations for the periods presented. The fund returns information reflected in this discussion and analysis is not indicative of the financial performance of Blackstone and is also not necessarily indicative of the future performance of any particular fund. An investment in Blackstone is not an investment in any of our funds. There can be no assurance that any of our funds or our other existing and future funds will achieve similar returns.

The following table presents the internal rates of return, except where noted, of our significant real estate funds:

		Three Months Ended																Six Months Ended																June 30, 2022
		June 30,																June 30,																Inception to Date
		2022								2021								2022								2021								Realized								Total
Fund (a)		Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net
BREP VII			1%				1%				7%				6%				9%				7%				11%				9%				30%				22%				22%				15%
BREP VIII			-2%				-2%				12%				10%				12%				10%				17%				13%				36%				28%				25%				18%
BREP IX			-1%				-1%				17%				13%				18%				14%				27%				20%				97%				66%				55%				40%
BREP Europe IV (b)			-2%				-2%				-1%				-1%				2%				-				-1%				-1%				28%				20%				20%				13%
BREP Europe V (b)			-				-				6%				5%				6%				5%				10%				8%				52%				43%				19%				14%
BREP Europe VI (b)			1%				-				11%				8%				11%				8%				19%				13%				103%				75%				42%				28%
BREP Asia I			-3%				-3%				5%				4%				-				-				20%				16%				27%				20%				19%				13%
BREP Asia II			-4%				-4%				4%				3%				-				-1%				16%				10%				69%				48%				17%				10%
BREP Co-Investment (c)			-				-				17%				17%				22%				21%				24%				22%				18%				16%				18%				16%
BPP (d)			2%				1%				4%				4%				12%				11%				6%				5%				n/a				n/a				14%				12%
BREIT (e)			n/a				2%				n/a				7%				n/a				7%				n/a				12%				n/a				n/a				n/a				13%
BREDS High-Yield (f)			-2%				-2%				4%				3%				-				-1%				9%				7%				15%				10%				14%				10%
BXMT (g)			n/a				-11%				n/a				5%				n/a				-7%				n/a				20%				n/a				n/a				n/a				9%

The returns presented herein represent those of the applicable Blackstone Funds and not those of Blackstone.

n/m	Not meaningful generally due to the limited time since initial investment.

n/a	Not applicable.

(a)	Net returns are based on the change in carrying value (realized and unrealized) after management fees, expenses and Performance Revenues.

(b)	Euro-based internal rates of return.

(c)	BREP Co-Investment represents co-investment capital raised for various BREP investments. The Net IRR reflected is calculated by aggregating each co-investment’s realized proceeds and unrealized value, as applicable, after management fees, expenses and Performance Revenues.

(d)	BPP represents the Core+ real estate funds which invest with a more modest risk profile and lower leverage.

(e)

Reflects a per share blended return for each respective period, assuming BREIT had a single share class, reinvestment of all dividends received during the period, and no upfront selling commission, net of all fees and expenses incurred by BREIT. These returns are not representative of the returns experienced by any particular investor or share class. Inception to date returns are presented on an annualized basis and are from January 1, 2017.

(f)	BREDS High-Yield represents the flagship real estate debt drawdown funds only. Inception to date returns are from July 1, 2009.

(g)	Reflects annualized return of a shareholder invested in BXMT as of the beginning of each period presented, assuming reinvestment of all dividends received during the period, and net of all fees and expenses incurred by BXMT. Return incorporates the closing NYSE stock price as of each period end. Inception to date returns are from May 22, 2013.

Funds With Closed Investment Periods

The Real Estate segment has eleven funds with closed investment periods as of June 30, 2022: BREP VIII, BREP VII, BREP VI, BREP V, BREP IV, BREP Europe V, BREP Europe IV, BREP Europe III, BREP Asia II, BREP Asia I and BREDS III. As of June 30, 2022, BREP VII, BREP VI, BREP V, BREP IV, BREP Europe IV and BREP Europe III were above their carried interest thresholds (i.e., the preferred return payable to its limited partners before the general partner is eligible to receive carried interest) and would have been above their carried interest thresholds even if all remaining investments were valued at zero. BREP VIII, BREP Europe V, BREP Asia II, BREP Asia I and BREDS III were above their carried interest thresholds. Funds are considered above their carried interest thresholds based on the aggregate fund position, although individual limited partners may be below their respective carried interest thresholds in certain funds.

Private Equity

The following table presents the results of operations for our Private Equity segment:

		Three Months Ended																Six Months Ended
		June 30,								2022 vs. 2021								June 30,								2022 vs. 2021
		2022				2021				$				%				2022				2021				$				%
		(Dollars in Thousands)
Management and Advisory Fees, Net
Base Management Fees		$	433,459			$	364,606			$	68,853				19%			$	854,931			$	742,266			$	112,665				15%
Transaction, Advisory and Other Fees, Net			27,551				32,272				(4,721	)			-15%				40,209				74,979				(34,770	)			-46%
Management Fee Offsets			(23,157	)			(3,601	)			(19,556	)			543%				(50,299	)			(17,520	)			(32,779	)			187%
Total Management and Advisory Fees, Net			437,853				393,277				44,576				11%				844,841				799,725				45,116				6%
Fee Related Performance Revenues			-				-				-				n/a				(648	)			-				(648	)			n/m
Fee Related Compensation			(152,622	)			(136,767	)			(15,855	)			12%				(303,672	)			(277,364	)			(26,308	)			9%
Other Operating Expenses			(83,233	)			(61,041	)			(22,192	)			36%				(150,977	)			(112,096	)			(38,881	)			35%
Fee Related Earnings			201,998				195,469				6,529				3%				389,544				410,265				(20,721	)			-5%
Realized Performance Revenues			122,884				383,010				(260,126	)			-68%				573,122				638,855				(65,733	)			-10%
Realized Performance Compensation			(57,380	)			(159,375	)			101,995				-64%				(264,083	)			(270,584	)			6,501				-2%
Realized Principal Investment Income			8,904				27,796				(18,892	)			-68%				74,342				143,199				(68,857	)			-48%
Net Realizations			74,408				251,431				(177,023	)			-70%				383,381				511,470				(128,089	)			-25%
Segment Distributable Earnings		$	276,406			$	446,900			$	(170,494	)			-38%			$	772,925			$	921,735			$	(148,810	)			-16%

n/m Not meaningful.

Three Months Ended June 30, 2022 Compared to Three Months Ended June 30, 2021

Segment Distributable Earnings were $276.4 million for the three months ended June 30, 2022, a decrease of $170.5 million, compared to $446.9 million for the three months ended June 30, 2021. The decrease in Segment Distributable Earnings was attributable to a decrease of $177.0 million in Net Realizations, partially offset by an increase of $6.5 million in Fee Related Earning.

Segment Distributable Earnings in our Private Equity segment in the second quarter of 2022 were lower compared to the second quarter of 2021. This was primarily driven by a decrease in Net Realizations, partially offset by an increase in Fee Related Earnings. The high rate of inflation, supply chain issues and heightened energy prices and input costs, including wages and materials, have continued to put profit margin pressure on our private equity portfolio companies, such as those in the manufacturing sector, that have high exposure to these input costs. The impact of such pressures, however, on our overall private equity portfolio has been to some extent mitigated by its focus on investing in companies that are less impacted by rising input costs or that benefit from pricing power. In addition, higher than expected rates of inflation and the expectation of significant interest rate increases in 2022 have contributed and are likely to continue to contribute to significant market volatility. This has disproportionately impacted the value of future cash flows of technology and growth companies, whose values fell materially in the second quarter of 2022. These companies may be subject to continued depressed, or even further declines in, values in a challenging market environment. Continued uncertainty and a difficult market environment are likely to lead to muted realizations for some time and negatively impact Segment Distributable Earnings in our Private Equity segment. Moreover, in private equity, we are facing an increasingly competitive fundraising environment, as well as certain limited partners being subject to allocation constraints due to private equity’s relative strong performance.

In energy, favorable market conditions contributed to a meaningful increase in the value of certain energy investments, as energy, oil and gas prices continued to increase in the second quarter of 2022. This short-term trend, in part due to decreased supply because of the ongoing war between Russia and Ukraine and heightened global demand, has had a positive impact on our energy portfolio. Beyond this short-term trend, however, increased scrutiny from regulators, investors and other market participants on the climate impact of oil and gas energy investments has weakened long-term market fundamentals for traditional energy. The persistence of these weakened market fundamentals could negatively impact the performance of certain investments in our energy and corporate private equity funds. See “Part I. Item 1A. Risk Factors — Risks Related to Our Business — An increase in interest rates and other changes in the financial markets could negatively impact the values of certain assets or investments and the ability of our funds and their portfolio companies to access the capital markets on attractive terms, which could adversely affect investment and realization opportunities, lead to lower-yielding investments and potentially decrease our net income,” “— Difficult market and geopolitical conditions can adversely affect our business in many ways, each of which could materially reduce our revenue, earnings and cash flow and adversely affect our financial prospects and condition” and “— A period of economic slowdown, which may be across one or more industries, sectors or geographies, has contributed and could in the future contribute to adverse operating performance for certain of our funds’ investments, which would adversely affect our operating results and cash flows” in our Annual Report on Form

10-K

for the year ended December 31, 2021.

Fee Related Earnings

Fee Related Earnings were $202.0 million for the three months ended June 30, 2022, an increase of $6.5 million, compared to $195.5 million for the three months ended June 30, 2021. The increase in Fee Related Earnings was attributable to an increase of $44.6 million in Management and Advisory Fees, Net, partially offset by increases of $22.2 million in Other Operating Expenses and $15.9 million in Fee Related Compensation.

Management and Advisory Fees, Net were $437.9 million for the three months ended June 30, 2022, an increase of $44.6 million, compared to $393.3 million for the three months ended June 30, 2021, primarily driven by an increase in Base Management Fees, partially offset by an increase in Management Fee Offsets. Base Management Fees increased $68.9 million primarily due to (a) the commencement of Strategic Partners IX’s investment period during the three months ended December 31, 2021 and

(b) Fee-Earning

Assets Under Management Growth in BIP. Management Fee Offsets increased $19.6 million primarily due to the launch of Strategic Partners IX during the three months ended December 31, 2021.

Other Operating Expenses were $83.2 million for the three months ended June 30, 2022, an increase of $22.2 million, compared to $61.0 million for the three months ended June 30, 2021. The increase was primarily due to travel and entertainment, occupancy and technology related expenses, and professional fees.

Fee Related Compensation was $152.6 million for the three months ended June 30, 2022, an increase of $15.9 million, compared to $136.8 million for the three months ended June 30, 2021. The increase was primarily due to an increase in Base Management Fees on which a portion of Fee Related Compensation is based.

Net Realizations

Net Realizations were $74.4 million for the three months ended June 30, 2022, a decrease of $177.0 million, compared to $251.4 million for the three months ended June 30, 2021. The decrease in Net Realizations was attributable to decreases of $260.1 million in Realized Performance Revenues and $18.9 million in Realized Principal Investment Income, partially offset by a decrease of $102.0 million in Realized Performance Compensation.

Realized Performance Revenues were $122.9 million for the three months ended June 30, 2022, a decrease of $260.1 million, compared to $383.0 million for the three months ended June 30, 2021. The decrease was primarily due to lower Realized Performance Revenues in corporate private equity and Tactical Opportunities.

Realized Principal Investment Income was $8.9 million for the three months ended June 30, 2022, a decrease of $18.9 million, compared to $27.8 million for the three months ended June 30, 2021. The decrease was primarily due to a decrease of Realized Principal Investment Income in corporate private equity.

Realized Performance Compensation was $57.4 million for the three months ended June 30, 2022, a decrease of $102.0 million, compared to $159.4 million for the three months ended June 30, 2021. The decrease was primarily due to the decrease in Realized Performance Revenues.

Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021

Segment Distributable Earnings were $772.9 million for the six months ended June 30, 2022, a decrease of $148.8 million, compared to $921.7 million for the six months ended June 30, 2021. The decrease in Segment Distributable Earnings was attributable to decreases of $20.7 million in Fee Related Earnings and $128.1 million in Net Realizations.

Fee Related Earnings

Fee Related Earnings were $389.5 million for the six months ended June 30, 2022, a decrease of $20.7 million, compared to $410.3 million for the six months ended June 30, 2021. The decrease in Fee Related Earnings was attributable to increases of $38.9 million in Other Operating Expenses and $26.3 million in Fee Related Compensation, partially offset by an increase of $45.1 million in Management and Advisory Fees, Net.

Other Operating Expenses were $151.0 million for the six months ended June 30, 2022, an increase of $38.9 million, compared to $112.1 million for the six months ended June 30, 2021. The increase was primarily due to travel and entertainment, occupancy and technology related expenses, and professional fees.

Fee Related Compensation was $303.7 million for the six months ended June 30, 2022, an increase of $26.3 million, compared to $277.4 million for the six months ended June 30, 2021. The increase was primarily due to an increase in Base Management Fees on which a portion of Fee Related Compensation is based.

Management and Advisory Fees, Net were $844.8 million for the six months ended June 30, 2022, an increase of $45.1 million, compared to $799.7 million for the six months ended June 30, 2021, primarily driven by an increase in Base Management Fees, partially offset by a decrease in Transaction, Advisory and Other Fees, Net and an increase in Management Fee Offsets. Base Management Fees increased $112.7 million primarily due to (a) the commencement of Strategic Partners GP Solutions and Strategic Partners IX’s investment periods during the three months ended June 30, 2021 and the three months ended December 31, 2021, respectively, and

(b) Fee-Earning

Assets Under Management Growth in BIP, partially offset by (c) the end of BXG’s fee holiday during the three months ended March 31, 2021. Transaction, Advisory and Other Fees, Net decreased $34.8 million primarily due to deal activity in BXCM. Management Fee Offsets increased $32.8 million primarily due to the launch of Strategic Partners IX during the three months ended December 31, 2021.

Net Realizations

Net Realizations were $383.4 million for the six months ended June 30, 2022, a decrease of $128.1 million, compared to $511.5 million for the six months ended June 30, 2021. The decrease in Net Realizations was attributable to decreases of $68.9 million in Realized Principal Investment Income and $65.7 million in Realized Performance Revenues.

Realized Principal Investment Income was $74.3 million for the six months ended June 30, 2022, a decrease of $68.9 million, compared to $143.2 million for the six months ended June 30, 2021. The decrease was primarily due to the segment’s allocation of the gain recognized in connection with the Pátria Sale Transaction during the three months ended March 31, 2021. For additional information, see “— Consolidated Results of Operations — Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021

— Revenues.”

Realized Performance Revenues were $573.1 million for the six months ended June 30, 2022, a decrease of $65.7 million, compared to $638.9 million for the six months ended June 30, 2021. The decrease was primarily due to lower Realized Performance Revenues in Tactical Opportunities, partially offset by higher Realized Performance Revenues in Strategic Partners.

Fund Returns

Fund returns information for our significant funds is included throughout this discussion and analysis to facilitate an understanding of our results of operations for the periods presented. The fund returns information reflected in this discussion and analysis is not indicative of the financial performance of Blackstone and is also not necessarily indicative of the future performance of any particular fund. An investment in Blackstone is not an investment in any of our funds. There can be no assurance that any of our funds or our other existing and future funds will achieve similar returns.

The following table presents the internal rates of return of our significant private equity funds:

		Three Months Ended																Six Months Ended																June 30, 2022
		June 30,																June 30,																Inception to Date
		2022								2021								2022								2021								Realized								Total
Fund (a)		Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net
BCP V			2%				-				3%				1%				19%				12%				148%				69%				10%				8%				10%				8%
BCP VI			-6%				-6%				4%				4%				-3%				-2%				15%				13%				21%				17%				17%				12%
BCP VII			-10%				-9%				14%				12%				-10%				-9%				29%				23%				44%				36%				22%				16%
BCP VIII			-4%				-5%				n/m				n/m				-1%				-2%				n/m				n/m				291%				123%				46%				25%
BEP I			5%				4%				13%				10%				32%				25%				53%				42%				18%				13%				15%				12%
BEP II			6%				6%				15%				14%				25%				24%				40%				38%				5%				2%				11%				8%
BEP III			-4%				-4%				24%				14%				5%				2%				59%				40%				169%				113%				68%				41%
BCP Asia I			-26%				-25%				60%				52%				-33%				-31%				88%				75%				146%				109%				58%				41%
BCEP I (b)			-				-				11%				10%				5%				4%				29%				27%				58%				52%				28%				25%
Tactical Opportunities			-2%				-3%				8%				6%				-				-1%				27%				21%				22%				17%				16%				12%
Tactical Opportunities Co-Investment and Other			-				-				7%				6%				-				2%				21%				18%				19%				18%				22%				19%
BXG I			-8%				-8%				n/m				n/m				-14%				-13%				n/m				n/m				n/m				n/m				11%				2%
Strategic Partners VI (c)			-1%				-1%				16%				15%				4%				4%				27%				24%				n/a				n/a				20%				15%
Strategic Partners VII (c)			1%				1%				20%				19%				5%				5%				34%				31%				n/a				n/a				27%				22%
Strategic Partners Real Assets II (c)			12%				10%				5%				4%				15%				13%				7%				6%				n/a				n/a				21%				17%
Strategic Partners VIII (c)			2%				1%				24%				22%				8%				6%				49%				41%				n/a				n/a				62%				50%
Strategic Partners Real Estate, SMA and Other (c)			2%				2%				7%				7%				13%				13%				14%				14%				n/a				n/a				22%				19%
Infra III (c)			22%				21%				n/m				n/m				40%				29%				n/m				n/m				n/a				n/a				137%				80%
BIP			-4%				-3%				13%				12%				9%				7%				39%				32%				n/a				n/a				23%				17%
Clarus IV			3%				2%				5%				4%				3%				2%				18%				14%				30%				23%				24%				15%
BXLS V			6%				4%				n/m				n/m				1%				-3%				n/m				n/m				n/a				n/a				17%				1%

The returns presented herein represent those of the applicable Blackstone Funds and not those of Blackstone.

n/m	Not meaningful generally due to the limited time since initial investment.

n/a	Not applicable.

SMA	Separately managed account.

(a)	Net returns are based on the change in carrying value (realized and unrealized) after management fees, expenses and Performance Revenues.

(b)	BCEP is a core private equity strategy which invests with a more modest risk profile and longer hold period than traditional private equity.

(c)	Realizations are treated as return of capital until fully recovered and therefore inception to date realized returns are not applicable. Returns are calculated from results that are reported on a three month lag from Strategic Partners’ fund financial statements and therefore do not include the impact of economic and market activities in the current quarter.

Funds With Closed Investment Periods

The corporate private equity funds within the Private Equity segment have nine funds with closed investment periods: BCP IV, BCP V, BCP VI, BCP VII, BCOM, BEP I, BEP II, BCEP I and BCP Asia I. As of June 30, 2022, BCP IV was above its carried interest threshold (i.e., the preferred return payable to its limited partners before the general partner is eligible to receive carried interest) and would still be above its carried interest threshold even if all remaining investments were valued at zero. BCP V is comprised of two fund classes, the BCP V “main fund” and

BCP V-AC

fund. Within these fund classes, the general partner is subject to equalization such that (a) the general partner accrues carried interest when the respective carried interest for either fund class is positive and (b) the general partner realizes carried interest so long as clawback obligations, if any, for either of the respective fund classes are fully satisfied. BCP V, BCP VI, BCP VII, BCOM, BEP I, BEP II, BCEP I and BCP Asia I were above their respective carried interest thresholds. Funds are considered above their carried interest thresholds based on the aggregate fund position, although individual limited partners may be below their respective carried interest thresholds in certain funds. We are entitled to retain previously realized carried interest up to 20% of BCOM’s net gains. As a result, Performance Revenues are recognized from BCOM on current period gains and losses.

Hedge Fund Solutions

The following table presents the results of operations for our Hedge Fund Solutions segment:

		Three Months Ended																Six Months Ended
		June 30,								2022 vs. 2021								June 30,								2022 vs. 2021
		2022				2021				$				%				2022				2021				$				%
		(Dollars in Thousands)
Management Fees, Net
Base Management Fees		$	145,077			$	155,244			$	(10,167	)			-7%			$	290,123			$	305,777			$	(15,654	)			-5%
Transaction and Other Fees, Net			3,450				1,558				1,892				121%				4,919				5,904				(985	)			-17%
Management Fee Offsets			(40	)			(203	)			163				-80%				(109	)			(261	)			152				-58%
Total Management Fees, Net			148,487				156,599				(8,112	)			-5%				294,933				311,420				(16,487	)			-5%
Fee Related Compensation			(57,863	)			(38,638	)			(19,225	)			50%				(105,098	)			(77,488	)			(27,610	)			36%
Other Operating Expenses			(26,066	)			(21,873	)			(4,193	)			19%				(49,250	)			(41,045	)			(8,205	)			20%
Fee Related Earnings			64,558				96,088				(31,530	)			-33%				140,585				192,887				(52,302	)			-27%
Realized Performance Revenues			7,197				17,056				(9,859	)			-58%				36,110				48,629				(12,519	)			-26%
Realized Performance Compensation			(2,083	)			(5,626	)			3,543				-63%				(11,083	)			(12,534	)			1,451				-12%
Realized Principal Investment Income (Loss)			(1,530	)			2,125				(3,655	)			n/m				13,371				37,675				(24,304	)			-65%
Net Realizations			3,584				13,555				(9,971	)			-74%				38,398				73,770				(35,372	)			-48%
Segment Distributable Earnings		$	68,142			$	109,643			$	(41,501	)			-38%			$	178,983			$	266,657			$	(87,674	)			-33%

n/m Not meaningful.

Three Months Ended June 30, 2022 Compared to Three Months Ended June 30, 2021

Segment Distributable Earnings were $68.1 million for the three months ended June 30, 2022, a decrease of $41.5 million, compared to $109.6 million for the three months ended June 30, 2021. The decrease in Segment Distributable Earnings was attributable to decreases of $31.5 million in Fee Related Earnings and $10.0 million in Net Realizations.

Segment Distributable Earnings in our Hedge Fund Solutions segment in the second quarter of 2022 were lower compared to the second quarter of 2021. This decrease was primarily driven by decreases in Fee Related Earnings and Net Realizations. Strategies across our Hedge Fund Solutions segment navigated a period of significant market volatility caused by high inflation and escalating interest rates to generally outperform the broader market. Despite such a challenging environment adversely impacting the performance of some of the underlying managers in our Hedge Fund Solutions segment, the segment demonstrated significantly less volatility than the broader markets in the second quarter of 2022 and an ability to provide downside protection in a difficult global market environment. Segment Distributable Earnings in the Hedge Fund Solutions segment would likely be negatively impacted by a significant or sustained weak market environment or decline in asset prices, including as a result of concerns over macroeconomic and geopolitical factors such as the war between Russia and Ukraine, or by withdrawal of assets by investors as a result of liquidity needs, performance or other reasons.

Prior to the recent meaningful equity market volatility, the equity market environment has in recent years generally been characterized by relatively low volatility, which could result in investors continuing to seek to reallocate capital away from traditional hedge fund strategies. Our Hedge Fund Solutions segment operates multiple business lines, manages strategies that are both long and short asset classes and generates a majority of its revenue through management fees. In that regard, the segment’s revenues depend in part on our ability to successfully grow such existing diverse business lines and strategies and to identify and scale new ones to meet evolving investor appetites. In recent years we have shifted the mix of our product offerings to include more products whose performance-based fees represent a more significant proportion of the fees earned from such products than has historically been the case. In addition, given market turbulence, we expect fundraising in our Hedge Fund Solutions segment to continue, but potentially at a slower pace, which may result in a delay in management fees. See “Part I. Item 1A. Risk Factors — Risks Related to Our Business — Difficult market and geopolitical conditions can adversely affect our business in many ways, each of which could materially reduce our revenue, earnings and cash flow and adversely affect our financial prospects and condition” and “— A period of economic slowdown, which may be across one or more industries, sectors or geographies, has contributed and could in the future contribute to adverse operating performance for certain of our funds’ investments, which would adversely affect our operating results and cash flows” in our Annual Report on Form

10-K

for the year ended December 31, 2021.

Fee Related Earnings

Fee Related Earnings were $64.6 million for the three months ended June 30, 2022, a decrease of $31.5 million, compared to $96.1 million for the three months ended June 30, 2021. The decrease in Fee Related Earnings was primarily attributable to decreases of $19.2 million in Fee Related Compensation and $8.1 million in Management Fees, Net.

Fee Related Compensation was $57.9 million for the three months ended June 30, 2022, an increase of $19.2 million, compared to $38.6 million for the three months ended June 30, 2021. The increase was primarily due to changes in compensation accruals.

Management Fees, Net were $148.5 million for the three months ended June 30, 2022, a decrease of $8.1 million, compared to $156.6 million for the three months ended June 30, 2021, primarily due to a decrease in Base Management Fees. Base Management Fees decreased $10.2 million primarily driven by a decrease in

Fee-Earning

Assets Under Management in customized solutions and commingled products.

Net Realizations

Net Realizations were $3.6 million for the three months ended June 30, 2022, a decrease of $10.0 million, compared to $13.6 million for the three months ended June 30, 2021. The decrease in Net Realizations was primarily attributable to decreases of $9.9 million in Realized Performance Revenues and $3.7 million in Realized Principal Investment Income (Loss), partially offset by a decrease of $3.5 million in Realized Performance Compensation.

Realized Performance Revenues were $7.2 million for the three months ended June 30, 2022, a decrease of $9.9 million, compared to $17.1 million for the three months ended June 30, 2021. The decrease was primarily due to lower Realized Performance Revenues in our customized solutions and commingled products.

Realized Principal Investment Income (Loss) was $(1.5) million for the three months ended June 30, 2022, a decrease of $3.7 million, compared to $2.1 million for the three months ended June 30, 2021. The decrease was primarily due to lower Realized Principal Investment Income in individual investor and specialized solutions.

Realized Performance Compensation was $2.1 million for the three months ended June 30, 2022, a decrease of $3.5 million, compared to $5.6 million for the three months ended June 30, 2021. The decrease was primarily due to the decrease in Realized Performance Revenues.

Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021

Segment Distributable Earnings were $179.0 million for the six months ended June 30, 2022, a decrease of $87.7 million, compared to $266.7 million for the six months ended June 30, 2021. The decrease in Segment Distributable Earnings was attributable to decreases of $52.3 million in Fee Related Earnings and $35.4 million in Net Realizations.

Fee Related Earnings

Fee Related Earnings were $140.6 million for the six months ended June 30, 2022, a decrease of $52.3 million, compared to $192.9 million for the six months ended June 30, 2021. The decrease in Fee Related Earnings was attributable to an increase of $27.6 million in Fee Related Compensation and a decrease of $16.5 million in Management Fees, Net.

Fee Related Compensation was $105.1 million for the six months ended June 30, 2022, an increase of $27.6 million, compared to $77.5 million for the six months ended June 30, 2021. The increase was primarily due to changes in compensation accruals.

Management Fees, Net were $294.9 million for the six months ended June 30, 2022, a decrease of $16.5 million, compared to $311.4 million for the six months ended June 30, 2021, primarily due to a decrease in Base Management Fees. Base Management Fees decreased $15.7 million primarily driven by a decrease in

Fee-Earning

Assets Under Management in customized solutions and commingled products.

Net Realizations

Net Realizations were $38.4 million for the six months ended June 30, 2022, a decrease of $35.4 million, compared to $73.8 million for the six months ended June 30, 2021. The decrease in Net Realizations was attributable to decreases of $24.3 million in Realized Principal Investment Income and $12.5 million in Realized Performance Revenues.

Realized Principal Investment Income (Loss) was $13.4 million for the six months ended June 30, 2022, a decrease of $24.3 million, compared to $37.7 million for the six months ended June 30, 2021. The decrease was primarily due to the segment’s allocation of the gain recognized in connection with the Pátria Sale Transaction during the three months ended March 31, 2021. For additional information, see “— Consolidated Results of Operations — Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021

— Revenues.”

Realized Performance Revenues were $36.1 million for the six months ended June 30, 2022, a decrease of $12.5 million, compared to $48.6 million for the six months ended June 30, 2021. The decrease was primarily due to lower Realized Performance Revenues in customized solutions and commingled products, partially offset by increased Realized Performance Revenues in individual investor and specialized solutions.

Composite Returns

Composite returns information is included throughout this discussion and analysis to facilitate an understanding of our results of operations for the periods presented. The composite returns information reflected in this discussion and analysis is not indicative of the financial performance of Blackstone and is also not necessarily indicative of the future results of any particular fund or composite. An investment in Blackstone is not an investment in any of our funds or composites. There can be no assurance that any of our funds or composites or our other existing and future funds or composites will achieve similar returns.

The following table presents the return information of the BAAM Principal Solutions Composite:

		Three																Six																Average Annual Returns (a)
		Months Ended June 30,																Months Ended June 30,																Periods Ended June 30, 2022
		2022								2021								2022								2021								One Year								Three Year								Five Year								Historical
Composite		Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net
BAAM Principal Solutions Composite (b)			1	%			-				3	%			3	%			2	%			1	%			6	%			5	%			4	%			3	%			6	%			5	%			6	%			5	%			7	%			6	%

The returns presented herein represent those of the applicable Blackstone Funds and not those of Blackstone.

(a)	Composite returns present a summarized asset-weighted return measure to evaluate the overall performance of the applicable class of Blackstone Funds.

(b)

BAAM’s Principal Solutions (“BPS”) Composite covers the period from January 2000 to present, although BAAM’s inception date is September 1990. The BPS Composite includes only BAAM-managed commingled and customized multi-manager funds and accounts and does not include BAAM’s individual investor solutions (liquid alternatives), strategic capital (seeding and GP minority stakes), strategic opportunities (co-invests), and advisory (non-discretionary) platforms, except for investments by BPS funds directly into those platforms. BAAM-managed funds in liquidation and, in the case of net returns, non-fee-paying assets are also excluded. The funds/accounts that comprise the BPS Composite are not managed within a single fund or account and are managed with different mandates. There is no guarantee that BAAM would have made the same mix of investments in a stand-alone fund/account. The BPS Composite is not an investible product and, as such, the performance of the BPS Composite does not represent the performance of an actual fund or account. The historical return is from January 1, 2000.

Operating Metrics

The following table presents information regarding our Invested Performance Eligible Assets Under Management:

		Invested Performance Eligible Assets Under Management												Estimated % Above High Water Mark/ Benchmark (a)
		As of June 30,												As of June 30,
		2022								2021				2022		2021
		(Dollars in Thousands)
Hedge Fund Solutions Managed Funds (b)		$	48,902,089							$	44,660,713			64%		93%

(a)

Estimated % Above High Water Mark/Benchmark represents the percentage of Invested Performance Eligible Assets Under Management that as of the dates presented would earn performance fees when the applicable Hedge Fund Solutions managed fund has positive investment performance relative to a benchmark, where applicable. Incremental positive performance in the applicable Blackstone Funds may cause additional assets to reach their respective High Water Mark or clear a benchmark return, thereby resulting in an increase in Estimated % Above High Water Mark/Benchmark.

(b)

For the Hedge Fund Solutions managed funds, at June 30, 2022, the incremental appreciation needed for the 36% of Invested Performance Eligible Assets Under Management below their respective High Water Marks/Benchmarks to reach their respective High Water Marks/Benchmarks was $834.1 million, an increase of $572.5 million, compared to $261.5 million at June 30, 2021. Of the Invested Performance Eligible Assets Under Management below their respective High Water Marks/Benchmarks as of June 30, 2022, 93% were within 5% of reaching their respective High Water Mark.

Credit & Insurance

The following table presents the results of operations for our Credit & Insurance segment:

		Three Months Ended																Six Months Ended
		June 30,								2022 vs. 2021								June 30,								2022 vs. 2021
		2022				2021				$				%				2022				2021				$				%
		(Dollars in Thousands)
Management Fees, Net
Base Management Fees		$	306,589			$	166,537			$	140,052				84	%		$	599,034			$	328,448			$	270,586				82	%
Transaction and Other Fees, Net			7,117				6,215				902				15	%			16,514				11,783				4,731				40	%
Management Fee Offsets			(1,165	)			(1,137	)			(28	)			2	%			(2,784	)			(3,262	)			478				-15	%
Total Management Fees, Net			312,541				171,615				140,926				82	%			612,764				336,969				275,795				82	%
Fee Related Performance Revenues			81,086				15,113				65,973				437	%			148,282				28,889				119,393				413	%
Fee Related Compensation			(137,035	)			(78,023	)			(59,012	)			76	%			(264,379	)			(155,194	)			(109,185	)			70	%
Other Operating Expenses			(63,882	)			(44,504	)			(19,378	)			44	%			(121,049	)			(91,339	)			(29,710	)			33	%
Fee Related Earnings			192,710				64,201				128,509				200	%			375,618				119,325				256,293				215	%
Realized Performance Revenues			78,973				41,819				37,154				89	%			109,716				67,086				42,630				64	%
Realized Performance Compensation			(36,109	)			(18,342	)			(17,767	)			97	%			(49,495	)			(28,387	)			(21,108	)			74	%
Realized Principal Investment Income			7,019				5,082				1,937				38	%			29,800				51,465				(21,665	)			-42	%
Net Realizations			49,883				28,559				21,324				75	%			90,021				90,164				(143	)			-
Segment Distributable Earnings		$	242,593			$	92,760			$	149,833				162	%		$	465,639			$	209,489			$	256,150				122	%

n/m Not meaningful.

Three Months Ended June 30, 2022 Compared to Three Months Ended June 30, 2021

Segment Distributable Earnings were $242.6 million for the three months ended June 30, 2022, an increase of $149.8 million, or 162%, compared to $92.8 million for the three months ended June 30, 2021. The increase in Segment Distributable Earnings was attributable to increases of $128.5 million in Fee Related Earnings and $21.3 million in Net Realizations.

Segment Distributable Earnings in our Credit & Insurance segment in the second quarter of 2022 were higher compared to the second quarter of 2021, driven by an increase in Fee Related Earnings and an increase in Net Realizations. While public spreads widened amid market volatility and heightened uncertainty, generally healthy economic activity and solid underlying company performance favorably impacted returns in our private credit strategies. Perpetual capital strategies, including certain retail strategies such as BCRED, represent an increasing percentage of our Total Assets Under Management in our Credit & Insurance segment. While in the second quarter we experienced meaningful net inflows, fundraising in our retail strategies moderated and market volatility and investor liquidity needs led to an increase in repurchase requests. A worsening, or potentially a continuation, of this challenging market environment would adversely affect our net flows in the near term. We believe the long-term trends, however, remain positive.

In the U.S., rising interest rates and the resulting higher cost of capital has the potential to negatively impact the free cash flow and credit quality of certain borrowers. In addition, rising costs resulting from supply chain issues and heightened energy prices and input costs are contributing to margin pressures at certain of our Credit & Insurance segment investments. Such investments would continue to be negatively impacted by a sustained high rate of inflation if they are unable to mitigate margin pressures, especially if concurrent with an increase in their debt service costs. If higher than expected rates of inflation and expected significant interest rate increases in 2022 occur concurrently with a period of economic weakness or a slowdown in growth, portfolio performance in our

Credit & Insurance segment may be negatively impacted. Although rising interest rates have the potential to negatively impact the financial performance of certain borrowers, we believe our current debt portfolio’s performance may benefit from increased interest rates because a substantial majority of the portfolio is senior secured with relatively low

loan-to-value,

floating rate and/or short duration. Nonetheless, significant market dislocation could limit the liquidity of certain assets traded in the credit markets, and this would impact our funds’ ability to sell such assets at attractive prices or in a timely manner.

In energy, oil and gas prices continued to increase meaningfully in the second quarter of 2022, in part due to decreased supply as a result of the ongoing war between Russia and Ukraine and heightened global demand. This short-term trend has had a positive impact on our energy portfolio. Beyond this short-term trend, however, increased scrutiny from regulators, investors and other market participants on the climate impact of oil and gas energy investments has weakened long-term market fundamentals for traditional energy. The persistence of these weakened market fundamentals could negatively impact the performance of certain investments in our credit funds, although our funds actively managed exposure to upstream energy through exits of certain investments in 2021. See “Part I. Item 1A. Risk Factors — Risks Related to Our Business — Difficult market and geopolitical conditions can adversely affect our business in many ways, each of which could materially reduce our revenue, earnings and cash flow and adversely affect our financial prospects and condition” and “— A period of economic slowdown, which may be across one or more industries, sectors or geographies, has contributed and could in the future contribute to adverse operating performance for certain of our funds’ investments, which would adversely affect our operating results and cash flows.” in our Annual Report on Form

10-K

for the year ended December 31, 2021.

Fee Related Earnings

Fee Related Earnings were $192.7 million for the three months ended June 30, 2022, an increase of $128.5 million, or 200%, compared to $64.2 million for the three months ended June 30, 2021. The increase in Fee Related Earnings was primarily attributable to increases of $140.9 million in Management Fees, Net and $66.0 million in Fee Related Performance Revenues, partially offset by increases of $59.0 million in Fee Related Compensation and $19.4 million in Other Operating Expenses.

Management Fees, Net were $312.5 million for the three months ended June 30, 2022, an increase of $140.9 million, compared to $171.6 million for the three months ended June 30, 2021, primarily driven by an increase in Base Management Fees. Base Management Fees increased $140.1 million primarily due to an increase in inflows in BCRED and BIS.

Fee Related Performance Revenues were $81.1 million for the three months ended June 30, 2022, an increase of $66.0 million, compared to $15.1 million for the three months ended June 30, 2021. The increase was primarily due to performance and growth in BCRED, including the expiration of BCRED’s fee holiday during the three months ended September 30, 2021.

Fee Related Compensation was $137.0 million for the three months ended June 30, 2022, an increase of $59.0 million, compared to $78.0 million for the three months ended June 30, 2021. The increase was primarily due to increases in Management Fees, Net and Fee Related Performance Revenues, on which a portion of Fee Related Compensation is based.

Other Operating Expenses were $63.9 million for the three months ended June 30, 2022, an increase of $19.4 million, compared to $44.5 million for the three months ended June 30, 2021. The increase was primarily due to travel and entertainment, occupancy and technology related expenses.

Net Realizations

Net Realizations were $49.9 million for the three months ended June 30, 2022, an increase of $21.3 million, or 75%, compared to $28.6 million for the three months ended June 30, 2021. The increase in Net Realizations was primarily attributable to an increase of $37.2 million in Realized Performance Revenues, partially offset by an increase of $17.8 million in Realized Performance Compensation.

Realized Performance Revenues were $79.0 million for the three months ended June 30, 2022, an increase of $37.2 million, compared to $41.8 million for the three months ended June 30, 2021. The increase was primarily due to increases in our mezzanine opportunistic funds, energy strategies and direct lending separately managed accounts.

Realized Performance Compensation was $36.1 million for the three months ended June 30, 2022, an increase of $17.8 million, compared to $18.3 million for the three months ended June 30, 2021. The increase was primarily due to the increase in Realized Performance Revenues.

Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021

Segment Distributable Earnings were $465.6 million for the six months ended June 30, 2022, an increase of $256.2 million, or 122%, compared to $209.5 million for the six months ended June 30, 2021. The increase in Segment Distributable Earnings was attributable to an increase of $256.3 million in Fee Related Earnings, partially offset by a decrease of $0.1 million in Net Realizations.

Fee Related Earnings

Fee Related Earnings were $375.6 million for the six months ended June 30, 2022, an increase of $256.3 million, or 215%, compared to $119.3 million for the six months ended June 30, 2021. The increase in Fee Related Earnings was attributable to increases of $275.8 million in Management Fees, Net and $119.4 million in Fee Related Performance Revenues, partially offset by increases of $109.2 million in Fee Related Compensation and $29.7 million in Other Operating Expenses.

Management Fees, Net were $612.8 million for the six months ended June 30, 2022, an increase of $275.8 million, compared to $337.0 million for the six months ended June 30, 2021, primarily driven by an increase in Base Management Fees. Base Management Fees increased $270.6 million primarily due to an increase in inflows in BCRED and BIS.

Fee Related Performance Revenues were $148.3 million for the six months ended June 30, 2022, an increase of $119.4 million, compared to $28.9 million for the six months ended June 30, 2021. The increase was primarily due to performance and growth in BCRED, including the expiration of BCRED’s fee holiday during the three months ended September 30, 2021.

Fee Related Compensation was $264.4 million for the six months ended June 30, 2022, an increase of $109.2 million, compared to $155.2 million for the six months ended June 30, 2021. The increase was primarily due to increases in Management Fees, Net and Fee Related Performance Revenues, on which a portion of Fee Related Compensation is based.

Other Operating Expenses were $121.0 million for the six months ended June 30, 2022, an increase of $29.7 million, compared to $91.3 million for the six months ended June 30, 2021. The increase was primarily due to travel and entertainment, occupancy and technology related expenses.

Net Realizations

Net Realizations were $90.0 million for the six months ended June 30, 2022, a decrease of $0.1 million, compared to $90.2 million for the six months ended June 30, 2021. The decrease in Net Realizations was attributable to a decrease of $21.7 million in Realized Principal Investment Income and an increase of $21.1 million in Realized Performance Compensation, partially offset by an increase of $42.6 million in Realized Performance Revenues.

Realized Principal Investment Income was $29.8 million for the six months ended June 30, 2022, a decrease of $21.7 million, compared to $51.5 million for the six months ended June 30, 2021. The decrease was primarily due to the segment’s allocation of the gain recognized in connection with the Pátria Sale Transaction during the three months ended March 31, 2021. For additional information, see “— Consolidated Results of Operations — Six Months Ended June 30, 2022 Compared to Six Months Ended June 30, 2021

— Revenues.”

Realized Performance Compensation was $49.5 million for the six months ended June 30, 2022, an increase of $21.1 million, compared to $28.4 million for the six months ended June 30, 2021. The increase was primarily due to the increase in Realized Performance Revenues.

Realized Performance Revenues were $109.7 million for the six months ended June 30, 2022, an increase of $42.6 million, compared to $67.1 million for the six months ended June 30, 2021. The increase was primarily due to higher realized carry interest in our energy strategies and our direct lending separately managed accounts.

Composite Returns

Composite returns information is included throughout this discussion and analysis to facilitate an understanding of our results of operations for the periods presented. The composite returns information reflected in this discussion and analysis is not indicative of the financial performance of Blackstone and is also not necessarily indicative of the future results of any particular fund or composite. An investment in Blackstone is not an investment in any of our funds or composites. There can be no assurance that any of our funds or composites or our other existing and future funds or composites will achieve similar returns.

The following table presents the return information for the Private Credit and Liquid Credit composites:

		Three Months Ended June 30,																Six Months Ended June 30,																June 30, 2022
		2022								2021								2022								2021								Inception to Date
Composite (a)		Gross				Net				Gross				Net				Gross				Net				Gross				Net				Gross				Net
Private Credit (b)(c)			-				-1	%			5	%			4	%			2	%			-				12	%			10	%			11	%			7	%
Liquid Credit (b)			-5	%			-6	%			2	%			2	%			-6	%			-6	%			3	%			3	%			5	%			4	%

The returns presented herein represent those of the applicable Blackstone Funds and not those of Blackstone.

(a)	Net returns are based on the change in carrying value (realized and unrealized) after management fees, expenses and Performance Allocations, net of tax advances.

(b)

Private Credit returns include mezzanine lending funds and middle market direct lending funds (including BXSL and BCRED), stressed/distressed strategies (including stressed/distressed funds and credit alpha strategies) and energy strategies. Liquid Credit returns include CLOs, closed-ended funds, open-ended funds and separately managed accounts. Only fee-earning funds exceeding $100 million of fair value at the beginning of each respective quarter-end are included. Funds in liquidation, funds investing primarily in investment grade corporate credit and asset-based finance are excluded. Blackstone Funds that were contributed to BXC as part of Blackstone’s acquisition of BXC in March 2008 and the pre-acquisition date performance for funds and vehicles acquired by BXC subsequent to March 2008, are also excluded. Private Credit and Liquid Credit’s inception to date returns are from December 31, 2005.

(c)

Effective June 30, 2022, for Euro-denominated funds included in the Private Credit composite return, cash flows are translated using a historical rate instead of the daily spot rate to more closely reflect the actual performance of foreign-denominated funds in the composite returns. Under the prior methodology, gross and net returns would have been (1)% and (1)%, 1% and 0%, and 11% and 7% for the three months ended, six months ended and inception to date periods ended June 30, 2022, respectively. Prior periods have been recast but such recast did not change the returns presented herein.

Operating Metrics

The following table presents information regarding our Invested Performance Eligible Assets Under Management:

		Invested Performance Eligible Assets Under Management								Estimated % Above High Water Mark/ Hurdle (a)
		As of June 30,								As of June 30,
		2022				2021				2022				2021
		(Dollars in Thousands)
Credit & Insurance (b)		$	80,993,494			$	42,210,582				92	%			76	%

(a)

Estimated % Above High Water Mark/Hurdle represents the percentage of Invested Performance Eligible Assets Under Management that as of the dates presented would earn performance fees when the applicable Credit & Insurance managed fund has positive investment performance relative to a hurdle, where applicable. Incremental positive performance in the applicable Blackstone Funds may cause additional assets to reach their respective High Water Mark or clear a hurdle return, thereby resulting in an increase in Estimated % Above High Water Mark/Hurdle.

(b)

For the Credit & Insurance managed funds, at June 30, 2022, the incremental appreciation needed for the 8% of Invested Performance Eligible Assets Under Management below their respective High Water Marks/Hurdles to reach their respective High Water Marks/Hurdles was $2.3 billion, a decrease of $(174.3) million, compared to $2.4 billion at June 30, 2021. Of the Invested Performance Eligible Assets Under Management below their respective High Water Marks/Hurdles as of June 30, 2022, 35% were within 5% of reaching their respective High Water Mark.

Non-GAAP

Financial Measures

These

non-GAAP

financial measures are presented without the consolidation of any Blackstone Funds that are consolidated into the Condensed Consolidated Financial Statements. Consequently, all

non-GAAP

financial measures exclude the assets, liabilities and operating results related to the Blackstone Funds. See “— Key Financial Measures and Indicators” for our definitions of Distributable Earnings, Segment Distributable Earnings, Fee Related Earnings and Adjusted EBITDA.

The following table is a reconciliation of Net Income (Loss) Attributable to Blackstone Inc. to Distributable Earnings, Total Segment Distributable Earnings, Fee Related Earnings and Adjusted EBITDA:

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2022				2021				2022				2021
		(Dollars in Thousands)
Net Income (Loss) Attributable to Blackstone Inc.		$	(29,393	)		$	1,309,152			$	1,187,481			$	3,057,024
Net Income (Loss) Attributable to Non-Controlling Interests in Blackstone Holdings			(35,521	)			1,116,193				1,023,792				2,351,977
Net Income (Loss) Attributable to Non-Controlling Interests in Consolidated Entities			(216,707	)			431,516				(332	)			818,366
Net Income Attributable to Redeemable Non-Controlling Interests in Consolidated Entities			25,875				637				30,927				1,266
Net Income (Loss)			(255,746	)			2,857,498				2,241,868				6,228,633
Provision for Taxes			36,514				288,250				519,795				287,803
Net Income (Loss) Before Provision for Taxes			(219,232	)			3,145,748				2,761,663				6,516,436
Transaction-Related Charges (a)			25,141				35,533				50,474				63,421
Amortization of Intangibles (b)			17,044				17,044				34,088				34,168
Impact of Consolidation (c)			190,832				(432,153	)			(30,595	)			(819,632	)
Unrealized Performance Revenues (d)			3,467,668				(2,697,170	)			2,174,618				(5,161,667	)
Unrealized Performance Allocations Compensation (e)			(1,386,543	)			1,150,219				(914,259	)			2,200,188
Unrealized Principal Investment (Income) Loss (f)			203,288				(104,658	)			176,530				(528,592	)
Other Revenues (g)			(155,704	)			(27,870	)			(228,523	)			(88,143	)
Equity-Based Compensation (h)			195,644				121,422				397,189				265,694
Administrative Fee Adjustment (i)			2,476				2,551				4,961				5,259
Taxes and Related Payables (j)			(354,789	)			(140,673	)			(502,441	)			(224,895	)
Distributable Earnings			1,985,825				1,069,993				3,923,705				2,262,237
Taxes and Related Payables (j)			354,789				140,673				502,441				224,895
Net Interest and Dividend Loss (k)			3,282				11,201				15,399				24,129
Total Segment Distributable Earnings			2,343,896				1,221,867				4,441,545				2,511,261
Realized Performance Revenues (l)			(2,206,774	)			(792,938	)			(3,519,584	)			(1,194,261	)
Realized Performance Compensation (m)			926,974				338,271				1,446,094				489,195
Realized Principal Investment Income (n)			(43,509	)			(63,132	)			(200,604	)			(361,288	)
Fee Related Earnings		$	1,020,587			$	704,068			$	2,167,451			$	1,444,907
Adjusted EBITDA Reconciliation
Distributable Earnings		$	1,985,825			$	1,069,993			$	3,923,705			$	2,262,237
Interest Expense (o)			69,425				44,132				136,027				88,472
Taxes and Related Payables (j)			354,789				140,673				502,441				224,895
Depreciation and Amortization (p)			15,644				12,581				29,960				24,874
Adjusted EBITDA		$	2,425,683			$	1,267,379			$	4,592,133			$	2,600,478

(a)

This adjustment removes Transaction-Related Charges, which are excluded from Blackstone’s segment presentation. Transaction-Related Charges arise from corporate actions including acquisitions, divestitures, and Blackstone’s initial public offering. They consist primarily of equity-based compensation charges, gains and losses on contingent consideration arrangements, changes in the balance of the Tax Receivable Agreement resulting from a change in tax law or similar event, transaction costs and any gains or losses associated with these corporate actions.

(b)	This adjustment removes the amortization of transaction-related intangibles, which are excluded from Blackstone’s segment presentation.

(c)	This adjustment reverses the effect of consolidating Blackstone Funds, which are excluded from Blackstone’s segment presentation. This adjustment includes the elimination of Blackstone’s interest in these funds and the removal of amounts associated with the ownership of Blackstone consolidated operating partnerships held by non-controlling interests.

(d)	This adjustment removes Unrealized Performance Allocations.

(e)	This adjustment removes Unrealized Performance Allocations Compensation.

(f)

This adjustment removes Unrealized Principal Investment Income (Loss) on a segment basis. The Segment Adjustment represents (1) the add back of Principal Investment Income, including general partner income, earned from consolidated Blackstone Funds which have been eliminated in consolidation, and (2) the removal of amounts associated with the ownership of Blackstone consolidated operating partnerships held by non-controlling interests.

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2022				2021				2022				2021
		(Dollars in Thousands)
GAAP Unrealized Principal Investment Income (Loss)		$	(500,490	)		$	328,835			$	(426,529	)		$	968,150
Segment Adjustment			297,202				(224,177	)			249,999				(439,558	)
Unrealized Principal Investment Income (Loss)		$	(203,288	)		$	104,658			$	(176,530	)		$	528,592

(g)	This adjustment removes Other Revenues on a segment basis. The Segment Adjustment represents (1) the add back of Other Revenues earned from consolidated Blackstone Funds which have been eliminated in consolidation, and (2) the removal of certain Transaction-Related Charges.

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2022				2021				2022				2021
		(Dollars in Thousands)
GAAP Other Revenue		$	155,588			$	27,896			$	228,457			$	88,200
Segment Adjustment			116				(26	)			66				(57	)
Other Revenues		$	155,704			$	27,870			$	228,523			$	88,143

(h)	This adjustment removes Equity-Based Compensation on a segment basis.

(i)	This adjustment adds an amount equal to an administrative fee collected on a quarterly basis from certain holders of Blackstone Holdings Partnership Units. The administrative fee is accounted for as a capital contribution under GAAP, but is reflected as a reduction of Other Operating Expenses in Blackstone’s segment presentation.

(j)

Taxes represent the total GAAP tax provision adjusted to include only the current tax provision (benefit) calculated on Income (Loss) Before Provision (Benefit) for Taxes and adjusted to exclude the tax impact of any divestitures. For interim periods, taxes are calculated using the preferred annualized effective tax rate approach. Related Payables represent tax-related payables including the amount payable under the Tax Receivable Agreement. See “— Key Financial Measures and Indicators — Distributable Earnings” for the full definition of Taxes and Related Payables.

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2022				2021				2022				2021
		(Dollars in Thousands)
Taxes		$	324,954			$	127,809			$	449,599			$	197,418
Related Payables			29,835				12,864				52,842				27,477
Taxes and Related Payables		$	354,789			$	140,673			$	502,441			$	224,895

(k)	This adjustment removes Interest and Dividend Revenue less Interest Expense on a segment basis. The Segment Adjustment represents (1) the add back of Interest and Dividend Revenue earned from consolidated Blackstone Funds which have been eliminated in consolidation, and (2) the removal of interest expense associated with the Tax Receivable Agreement.

		Three Months Ended								Six Months Ended
		June 30,								June 30,
		2022				2021				2022				2021
		(Dollars in Thousands)
GAAP Interest and Dividend Revenue		$	62,075			$	31,017			$	116,560			$	62,429
Segment Adjustment			4,068				1,914				4,068				1,914
Interest and Dividend Revenue			66,143				32,931				120,628				64,343
GAAP Interest Expense			69,642				44,322				136,389				89,305
Segment Adjustment			(217	)			(190	)			(362	)			(833	)
Interest Expense			69,425				44,132				136,027				88,472
Net Interest and Dividend Loss		$	(3,282	)		$	(11,201	)		$	(15,399	)		$	(24,129	)

(l)	This adjustment removes the total segment amount of Realized Performance Revenues.

(m)	This adjustment removes the total segment amount of Realized Performance Compensation.

(n)	This adjustment removes the total segment amount of Realized Principal Investment Income.

(o)	This adjustment adds back Interest Expense on a segment basis, excluding interest expense related to the Tax Receivable Agreement.

(p)	This adjustment adds back Depreciation and Amortization on a segment basis.

The following tables are a reconciliation of Total GAAP Investments to Net Accrued Performance Revenues. Total GAAP Investments and Net Accrued Performance Revenues consist of the following:

		June 30,
		2022				2021
		(Dollars in Thousands)
Investments of Consolidated Blackstone Funds		$	3,764,850			$	1,871,269
Equity Method Investments
Partnership Investments			5,446,688				4,916,674
Accrued Performance Allocations			13,544,855				12,101,142
Corporate Treasury Investments			810,672				2,440,325
Other Investments			3,756,693				833,912
Total GAAP Investments		$	27,323,758			$	22,163,322
Accrued Performance Allocations - GAAP		$	13,544,855			$	12,101,142
Impact of Consolidation (a)			12,475				1
Due from Affiliates - GAAP (b)			136,631				59,304
Less: Net Realized Performance Revenues (c)			(262,083	)			(261,760	)
Less: Accrued Performance Compensation - GAAP (d)			(5,955,982	)			(5,137,933	)
Net Accrued Performance Revenues		$	7,475,896			$	6,760,754

(a)	This adjustment adds back investments in consolidated Blackstone Funds which have been eliminated in consolidation.

(b)	Represents GAAP accrued performance revenue recorded within Due from Affiliates.

(c)	Represents Performance Revenues realized but not yet distributed as of the reporting date and are included in Distributable Earnings in the period they are realized.

(d)	Represents GAAP accrued performance compensation associated with Accrued Performance Allocations and is recorded within Accrued Compensation and Benefits and Due to Affiliates.

Liquidity and Capital Resources

General

Blackstone’s business model derives revenue primarily from third party assets under management. Blackstone is not a capital or balance sheet intensive business and targets operating expense levels such that total management and advisory fees exceed total operating expenses each period. As a result, we require limited capital resources to support the working capital or operating needs of our businesses. We draw primarily on the long-term committed capital of our limited partner investors to fund the investment requirements of the Blackstone Funds and use our own realizations and cash flows to invest in growth initiatives, make commitments to our own funds, where our minimum general partner commitments are generally less than 5% of the limited partner commitments of a fund, and pay dividends to shareholders.

Fluctuations in our statement of financial condition result primarily from activities of the Blackstone Funds that are consolidated as well as business transactions, such as the issuance of senior notes described below. The majority economic ownership interests of the Blackstone Funds that are consolidated are reflected as Redeemable

Non-Controlling

Interests in Consolidated Entities and

Non-Controlling

Interests in Consolidated Entities in the Condensed Consolidated Financial Statements. The consolidation of these Blackstone Funds has no net effect on Blackstone’s Net Income or Equity. Additionally, fluctuations in our statement of financial condition also include appreciation or depreciation in Blackstone investments in the Blackstone Funds, additional investments and redemptions of such interests in the Blackstone Funds and the collection of receivables related to management and advisory fees.

Total Assets were $41.6 billion as of June 30, 2022, an increase of $434.9 million, from December 31, 2021. The increase in Total Assets was principally due to an increase of $1.8 billion in total assets attributable to consolidated Blackstone funds, partially offset by a decrease of $763.1 million in total assets attributable to consolidated operating partnerships. The increase in total assets attributable to consolidated Blackstone funds was primarily due to an increase of $1.7 billion in Investments. The increase in Investments was primarily due to the consolidation of five Blackstone funds. The decrease in total assets attributable to consolidated operating partnerships was primarily due to decreases of $2.5 billion in Investments and $717.2 million in Due from Affiliates, partially offset by an increase of $2.1 billion in Cash and Cash Equivalents. The decrease in Investments was primarily due to depreciation in the value of Blackstone’s interests in its real estate and private equity investments. The decrease in Due from Affiliates was primarily due to a decrease in the receivable due from

non-consolidated

entities and portfolio companies. The increase in Cash and Cash Equivalents was primarily due to the issuance of $1.5 billion of notes on January 10, 2022 and

€

500 million of notes on June 1, 2022. The other net variances of the assets attributable to the consolidated operating partnerships and consolidated Blackstone funds were relatively unchanged.

Total Liabilities were $20.3 billion as of June 30, 2022, an increase of $806.8 million, from December 31, 2021. The increase in Total Liabilities was principally due to an increase of $822.6 million in total liabilities attributable to consolidated operating partnerships. The increase in total liabilities attributable to the consolidated operating partnerships was primarily due to an increase of $1.6 billion in Loans Payable, partially offset by a decrease of $1.1 billion in Accrued Compensation and Benefits. The increase in Loans Payable was primarily due to the issuance of $1.5 billion of notes on January 10, 2022 and

€

500 million of notes on June 1, 2022. The decrease in Accrued Compensation and Benefits was primarily due to a decrease in performance compensation. The other net variances of the liabilities attributable to the consolidated operating partnerships were relatively unchanged.

Sources and Uses of Liquidity

We have multiple sources of liquidity to meet our capital needs, including annual cash flows, accumulated earnings in our businesses, the proceeds from our issuances of senior notes, liquid investments we hold on our balance sheet and access to our $4.1 billion committed revolving credit facility. On June 3, 2022, Blackstone, through the Issuer, amended and restated its revolving credit facility to, among other things, increase the amount of available borrowings to $4.1 billion and extended the maturity date from November 24, 2025 to June 3, 2027. As of June 30, 2022, Blackstone had $4.2 billion in Cash and Cash Equivalents, $810.7 million invested in Corporate Treasury Investments and $3.8 billion in Other Investments (which included $1.3 billion of liquid investments), against $9.5 billion in borrowings from our bond issuances, and no borrowings outstanding under our revolving credit facility.

On June 1, 2022, Blackstone, through the Issuer, issued

€

500 million aggregate principal amount of 3.500% senior notes due June 1, 2034. For additional information on Blackstone’s senior notes see Note 12. “Borrowings” in the “Notes to Condensed Consolidated Financial Statements” in “Part I. Item 1. Financial Statements” of this filing and “— Notable Transactions.”

In addition to the cash we received from our notes offerings and availability under our revolving credit facility, we expect to receive (a) cash generated from operating activities, (b) Performance Allocations and Incentive Fee realizations, and (c) realizations on the fund investments that we make. The amounts received from these three sources in particular may vary substantially from year to year and quarter to quarter depending on the frequency and size of realization events or net returns experienced by our investment funds. Our available capital could be adversely affected if there are prolonged periods of few substantial realizations from our investment funds accompanied by substantial capital calls for new investments from those investment funds. Therefore, Blackstone’s commitments to our funds are taken into consideration when managing our overall liquidity and cash position.

We expect that our primary liquidity needs will be cash to (a) provide capital to facilitate the growth of our existing businesses, which principally includes funding our general partner and

co-investment

commitments to our funds, (b) provide capital for business expansion, (c) pay operating expenses, including cash compensation to our employees and other obligations as they arise, (d) fund modest capital expenditures, (e) repay borrowings and related interest costs, (f) pay income taxes, (g) repurchase shares of our common stock and Blackstone Holdings Partnership Units pursuant to our repurchase program and (h) pay dividends to our shareholders and distributions to the holders of Blackstone Holdings Partnership Units. For a tabular presentation of Blackstone’s contractual obligations and the expected timing of such see “— Contractual Obligations.”

Capital Commitments

Our own capital commitments to our funds, the funds we invest in and our investment strategies as of June 30, 2022 consisted of the following:

										Senior Managing Directors
		Blackstone and								and Certain Other
		General Partner								Professionals (a)
		Original				Remaining				Original				Remaining
Fund		Commitment				Commitment				Commitment				Commitment
		(Dollars in Thousands)
Real Estate
BREP VI		$	750,000			$	36,809			$	150,000			$	12,270
BREP VII			300,000				33,394				100,000				11,131
BREP VIII			300,000				43,144				100,000				14,381
BREP IX			300,000				103,047				100,000				34,349
BREP X			300,000				300,000				100,000				100,000
BREP Europe III			100,000				11,989				35,000				3,996
BREP Europe IV			130,000				24,074				43,333				8,025
BREP Europe V			150,000				26,592				43,333				7,682
BREP Europe VI			130,000				84,596				43,333				28,199
BREP Asia I			50,000				10,141				16,667				3,380
BREP Asia II			70,707				16,215				23,569				5,405
BREP Asia III			78,373				78,373				26,124				26,124
BREDS III			50,000				13,499				16,667				4,500
BREDS IV			50,000				26,187				—				—
BPP			312,000				42,514				—				—
Other (b)			24,091				6,796				—				—
Total Real Estate (c)			3,095,171				857,370				798,026				259,442

continued...

										Senior Managing Directors
		Blackstone and								and Certain Other
		General Partner								Professionals (a)
		Original				Remaining				Original				Remaining
Fund		Commitment				Commitment				Commitment				Commitment
		(Dollars in Thousands)
Private Equity
BCP V		$	629,356			$	30,642			$	—			$	—
BCP VI			719,718				82,829				250,000				28,771
BCP VII			500,000				42,980				225,000				19,341
BCP VIII			500,000				317,295				225,000				142,783
BCP IX			500,000				500,000				225,000				225,000
BEP I			50,000				4,728				—				—
BEP II			80,000				14,620				26,667				4,873
BEP III			80,000				51,868				26,667				17,289
BEP IV			17,545				17,545				5,848				5,848
BCEP I			120,000				27,202				18,992				4,305
BCEP II			160,000				132,048				32,640				26,938
BCP Asia I			40,000				13,132				13,333				4,377
BCP Asia II			100,000				100,000				33,333				33,333
Tactical Opportunities			461,900				215,341				153,967				71,780
Strategic Partners			1,151,889				746,258				162,087				100,079
BIP			271,663				101,441				—				—
BXLS			142,057				104,089				37,353				31,927
BXG			135,501				81,665				62,997				45,355
Other (b)			290,210				31,187				—				—
Total Private Equity (c)			5,949,839				2,614,870				1,498,884				761,999
Hedge Fund Solutions
Strategic Alliance I			50,000				2,033				—				—
Strategic Alliance II			50,000				1,482				—				—
Strategic Alliance III			22,000				7,101				—				—
Strategic Alliance IV			15,000				15,000				—				—
Strategic Holdings I			154,610				33,211				—				—
Strategic Holdings II			50,000				31,400				—				—
Horizon			100,000				27,765				—				—
Dislocation			10,000				10,000				—				—
Other (b)			17,205				8,149				—				—
Total Hedge Fund Solutions			468,815				136,141				—				—

continued...

										Senior Managing Directors
		Blackstone and								and Certain Other
		General Partner								Professionals (a)
		Original				Remaining				Original				Remaining
Fund		Commitment				Commitment				Commitment				Commitment
		(Dollars in Thousands)
Credit & Insurance
Mezzanine / Opportunistic II		$	120,000			$	29,204			$	110,101			$	26,795
Mezzanine / Opportunistic III			130,783				39,096				31,546				9,430
Mezzanine / Opportunistic IV			122,000				104,308				33,735				28,843
European Senior Debt I			63,000				16,508				56,882				14,905
European Senior Debt II			92,281				60,036				25,389				16,526
Stressed / Distressed I			50,000				4,869				27,666				2,694
Stressed / Distressed II			125,000				51,695				119,878				49,576
Stressed / Distressed III			151,000				113,042				32,727				24,500
Energy I			80,000				37,630				75,445				35,487
Energy II			150,000				116,387				26,615				20,651
Credit Alpha Fund			52,102				19,752				50,670				19,209
Credit Alpha Fund II			25,500				12,550				6,289				3,095
Other (b)			148,013				54,069				20,391				4,025
Total Credit & Insurance			1,309,679				659,146				617,334				255,736
Other
Treasury (d)			1,936,933				1,445,785				—				—
		$	12,760,437			$	5,713,312			$	2,914,244			$	1,277,177

(a)

For some of the general partner commitments shown in the table above, we require our senior managing directors and certain other professionals to fund a portion of the commitment even though the ultimate obligation to fund the aggregate commitment is ours pursuant to the governing agreements of the respective funds. The amounts of the aggregate applicable general partner original and remaining commitment are shown in the table above. In addition, certain senior managing directors and other professionals may be required to fund a de minimis amount of the commitment in certain carry funds. We expect our commitments to be drawn down over time and to be funded by available cash and cash generated from operations and realizations. Taking into account prevailing market conditions and both the liquidity and cash or liquid investment balances, we believe that the sources of liquidity described above will be more than sufficient to fund our working capital requirements.

(b)	Represents capital commitments to a number of other funds in each respective segment.

(c)	Real Estate and Private Equity include co-investments, as applicable.

(d)	Represents loan origination commitments, revolver commitments and capital market commitments.

For a tabular presentation of the timing of Blackstone’s remaining capital commitments to our funds, the funds we invest in and our investment strategies see “— Contractual Obligations.”

Borrowings

As of June 30, 2022, Blackstone Holdings Finance Co. L.L.C. (the “Issuer”), an indirect subsidiary of Blackstone, had issued and outstanding the following senior notes (collectively the “Notes”):

		Aggregate
		Principal
		Amount
		(Dollars/Euros
Senior Notes (a)		in Thousands)
4.750%, Due 2/15/2023		$	400,000
2.000%, Due 5/19/2025		€	300,000
1.000%, Due 10/5/2026		€	600,000
3.150%, Due 10/2/2027		$	300,000
1.625%, Due 8/5/2028		$	650,000
1.500%, Due 4/10/2029		€	600,000
2.500%, Due 1/10/2030		$	500,000
1.600%, Due 3/30/2031		$	500,000
2.000%, Due 1/30/2032		$	800,000
2.550%, Due 3/30/2032		$	500,000
3.500%, Due 6/1/2034		€	500,000
6.250%, Due 8/15/2042		$	250,000
5.000%, Due 6/15/2044		$	500,000
4.450%, Due 7/15/2045		$	350,000
4.000%, Due 10/2/2047		$	300,000
3.500%, Due 9/10/2049		$	400,000
2.800%, Due 9/30/2050		$	400,000
2.850%, Due 8/5/2051		$	550,000
3.200%, Due 1/30/2052		$	1,000,000
		$	9,496,800

(a)

The Notes are unsecured and unsubordinated obligations of the Issuer and are fully and unconditionally guaranteed, jointly and severally, by Blackstone Inc. and each of the Blackstone Holdings Partnerships. The Notes contain customary covenants and financial restrictions that, among other things, limit the Issuer and the guarantors’ ability, subject to certain exceptions, to incur indebtedness secured by liens on voting stock or profit participating equity interests of their subsidiaries or merge, consolidate or sell, transfer or lease assets. The Notes also contain customary events of default. All or a portion of the Notes may be redeemed at our option, in whole or in part, at any time and from time to time, prior to their stated maturity, at the make-whole redemption price set forth in the Notes. If a change of control repurchase event occurs, the Notes are subject to repurchase at the repurchase price as set forth in the Notes.

Blackstone, through the Issuer, has a $4.1 billion unsecured revolving credit facility (the “Credit Facility”) with Citibank, N.A., as administrative agent with a maturity date of June 3, 2027. Borrowings may also be made in U.K. sterling, euros, Swiss francs, Japanese yen or Canadian dollars, in each case subject to certain

sub-limits.

The Credit Facility contains customary representations, covenants and events of default. Financial covenants consist of a maximum net leverage ratio and a requirement to keep a minimum amount of

fee-earning

assets under management, each tested quarterly.

For a tabular presentation of the payment timing of principal and interest due on Blackstone’s issued notes and revolving credit facility see “— Contractual Obligations.”

Contractual Obligations

The following table sets forth information relating to our contractual obligations as of June 30, 2022 on a consolidated basis and on a basis deconsolidating the Blackstone Funds:

		July 1, 2022 to
Contractual Obligations		December 31, 2022				2023-2024				2025-2026				Thereafter				Total
		(Dollars in Thousands)
Operating Lease Obligations (a)		$	72,240			$	289,417			$	297,781			$	326,937			$	986,375
Purchase Obligations			81,707				77,630				12,080				—				171,417
Blackstone Issued Notes and Revolving Credit Facility (b)			—				400,000				943,560				8,153,240				9,496,800
Interest on Blackstone Issued Notes and Revolving Credit Facility (c)			123,555				515,935				497,627				3,477,633				4,614,750
Blackstone Funds Capital Commitments to Investee Funds (d)			206,774				—				—				—				206,774
Due to Certain Non-Controlling Interest Holders in Connection with Tax Receivable Agreements (e)			—				157,002				214,670				1,190,579				1,562,251
Unrecognized Tax Benefits, Including Interest and Penalties (f)			—				—				—				—				—
Blackstone Operating Entities Capital Commitments to Blackstone Funds and Other (g)			5,713,312				—				—				—				5,713,312
Consolidated Contractual Obligations			6,197,588				1,439,984				1,965,718				13,148,389				22,751,679
Blackstone Funds Capital Commitments to Investee Funds (d)			(206,774	)			—				—				—				(206,774	)
Blackstone Operating Entities Contractual Obligations		$	5,990,814			$	1,439,984			$	1,965,718			$	13,148,389			$	22,544,905

(a)

We lease our primary office space and certain office equipment under agreements that expire through 2032. Occupancy lease agreements, in addition to contractual rent payments, generally include additional payments for certain costs incurred by the landlord, such as building expenses, and utilities. To the extent these are fixed or determinable they are included in the table above. The table above includes operating leases that are recognized as Operating Lease Liabilities, short-term leases that are not recorded as Operating Lease Liabilities and leases that have been signed but not yet commenced which are not recorded as Operating Lease Liabilities. The amounts in this table are presented net of contractual sublease commitments and tenant improvement allowances.

(b)	Represents the principal amount due on the senior notes we issued assuming no pre-payments are made and the notes are held until their final maturity. As of June 30, 2022, we had no outstanding borrowings under our revolver.

(c)	Represents interest to be paid over the maturity of our senior notes which has been calculated assuming no pre-payments are made and debt is held until its final maturity date. These amounts include commitment fees for unutilized borrowings under our revolver.

(d)	These obligations represent commitments of the consolidated Blackstone Funds to make capital contributions to investee funds and portfolio companies. These amounts are generally due on demand and are therefore presented in the less than one year category.

(e)

Represents obligations by Blackstone’s corporate subsidiary to make payments under the Tax Receivable Agreements to certain non-controlling interest holders for the tax savings realized from the taxable purchases of their interests in connection with the reorganization at the time of Blackstone’s IPO in 2007 and subsequent purchases. The obligation represents the amount of the payments currently expected to be made, which are dependent on the tax savings actually realized as determined annually without discounting for the timing of the payments. As required by GAAP, the amount of the obligation included in the Condensed Consolidated Financial Statements and shown in Note 16. “Related Party Transactions” (see “Part I. Item 1. Financial Statements”) differs to reflect the net present value of the payments due to certain non-controlling interest holders.

(f)	As of June 30, 2022, there were no Unrecognized Tax Benefits, including Interest and Penalties. In addition, Blackstone is not able to make a reasonably reliable estimate of the timing of payments in individual years in connection with gross unrecognized benefits of $99.2 million and interest of $29.6 million, therefore, such amounts are not included in the above contractual obligations table.

(g)

These obligations represent commitments by us to provide general partner capital funding to the Blackstone Funds, limited partner capital funding to other funds and Blackstone principal investment commitments. These amounts are generally due on demand and are therefore presented in the less than one year category; however, a substantial amount of the capital commitments are expected to be called over the next three years. We expect to continue to make these general partner capital commitments as we raise additional amounts for our investment funds over time.

Guarantees

Blackstone and certain of its consolidated funds provide financial guarantees. The amounts and nature of these guarantees are described in Note 17. “Commitments and Contingencies — Contingencies — Guarantees” in the “Notes to Condensed Consolidated Financial Statements” in “Part I. Item 1. Financial Statements” of this filing.

Indemnifications

In many of its service contracts, Blackstone agrees to indemnify the third party service provider under certain circumstances. The terms of the indemnities vary from contract to contract and the amount of indemnification liability, if any, cannot be determined and has not been included in the above contractual obligations table or recorded in our Condensed Consolidated Financial Statements as of June 30, 2022.

Clawback Obligations

Performance Allocations are subject to clawback to the extent that the Performance Allocations received to date with respect to a fund exceeds the amount due to Blackstone based on cumulative results of that fund. The amounts and nature of Blackstone’s clawback obligations are described in Note 17. “Commitments and Contingencies — Contingencies — Contingent Obligations (Clawback)” in the “Notes to Condensed Consolidated Financial Statements” in “Part I. Item 1. Financial Statements” of this filing.

Share Repurchase Program

On December 7, 2021, Blackstone’s board of directors authorized the repurchase of up to $2.0 billion of common stock and Blackstone Holdings Partnership Units. Under the repurchase program, repurchases may be made from time to time in open market transactions, in privately negotiated transactions or otherwise. The timing and the actual number repurchased will depend on a variety of factors, including legal requirements, price and economic and market conditions. The repurchase program may be changed, suspended or discontinued at any time and does not have a specified expiration date.

During the three and six months ended June 30, 2022, Blackstone repurchased 1.9 million shares of common stock at a total cost of $195.3 million. As of June 30, 2022, the amount remaining available for repurchases under the program was $1.3 billion.

Dividends

Our intention is to pay to holders of common stock a quarterly dividend representing approximately 85% of Blackstone Inc.’s share of Distributable Earnings, subject to adjustment by amounts determined by our board of directors to be necessary or appropriate to provide for the conduct of our business, to make appropriate investments in our business and funds, to comply with applicable law, any of our debt instruments or other agreements, or to provide for future cash requirements such as

tax-related

payments, clawback obligations and dividends to shareholders for any ensuing quarter. The dividend amount could also be adjusted upward in any one quarter.

For Blackstone’s definition of Distributable Earnings, see “— Key Financial Measures and Indicators.”

All of the foregoing is subject to the qualification that the declaration and payment of any dividends are at the sole discretion of our board of directors and our board of directors may change our dividend policy at any time, including, without limitation, to reduce such quarterly dividends or even to eliminate such dividends entirely.

Because the publicly traded entity and/or its wholly owned subsidiaries must pay taxes and make payments under the tax receivable agreements, the amounts ultimately paid as dividends by Blackstone to common shareholders in respect of each fiscal year are generally expected to be less, on a per share or per unit basis, than the amounts distributed by the Blackstone Holdings Partnerships to the Blackstone personnel and others who are limited partners of the Blackstone Holdings Partnerships in respect of their Blackstone Holdings Partnership Units. Following Blackstone’s conversion from a limited partnership to a corporation, we expect to pay more corporate income taxes than we would have as a limited partnership, which will increase this difference between the per share dividend and per unit distribution amounts.

Dividends are treated as qualified dividends to the extent of Blackstone’s current and accumulated earnings and profits, with any excess dividends treated as a return of capital to the extent of the shareholder’s basis.

The following graph shows fiscal quarterly and annual per common shareholder dividends for 2022 and 2021. Dividends are declared and paid in the quarter subsequent to the quarter in which they are earned.

With respect to the second quarter of fiscal year 2022, we paid to shareholders of our common stock a dividend of $1.27 per share, aggregating to $2.59 per share of common stock in respect of the six months ended June 30, 2022. With respect to fiscal year 2021, we paid shareholders aggregate dividends of $4.06 per share.

Leverage

We may under certain circumstances use leverage opportunistically and over time to create the most efficient capital structure for Blackstone and our shareholders. In addition to the borrowings from our note issuances and our revolving credit facility, we may use reverse repurchase agreements, repurchase agreements and securities sold, not yet purchased. Reverse repurchase agreements are entered into primarily to take advantage of opportunistic yields otherwise absent in the overnight markets and also to use the collateral received to cover securities sold, not yet purchased. Repurchase agreements are entered into primarily to opportunistically yield higher spreads on purchased securities. The balances held in these financial instruments fluctuate based on Blackstone’s liquidity needs, market conditions and investment risk profiles.

The following table presents information regarding these financial instruments in our Condensed Consolidated Statements of Financial Condition:

						Securities
		Repurchase				Sold, Not Yet
		Agreements				Purchased
		(Dollars in Millions)
Balance, June 30, 2022		$	152.5			$	27.0
Balance, December 31, 2021		$	58.0			$	27.8
Six Months Ended June 30, 2022
Average Daily Balance		$	90.3			$	27.3
Maximum Daily Balance		$	182.9			$	27.8

Critical Accounting Policies

We prepare our Condensed Consolidated Financial Statements in accordance with GAAP. In applying many of these accounting principles, we need to make assumptions, estimates and/or judgments that affect the reported amounts of assets, liabilities, revenues and expenses in our Condensed Consolidated Financial Statements. We base our estimates and judgments on historical experience and other assumptions that we believe are reasonable under the circumstances. These assumptions, estimates and/or judgments, however, are often subjective. Actual results may be affected negatively based on changing circumstances. If actual amounts are ultimately different from our estimates, the revisions are included in our results of operations for the period in which the actual amounts become known. We believe the following critical accounting policies could potentially produce materially different results if we were to change underlying assumptions, estimates and/or judgments. For a description of our accounting policies, see Note 2. “Summary of Significant Accounting Policies” in the “Notes to Condensed Consolidated Financial Statements” in “Part I. Item 1. Financial Statements” of this filing.

Principles of Consolidation

For a description of our accounting policy on consolidation, see Note 2. “Summary of Significant Accounting Policies — Consolidation” and Note 9. “Variable Interest Entities” in the “Notes to Condensed Consolidated Financial Statements” in “Part I. Item 1. Financial Statements” of this filing for detailed information on Blackstone’s involvement with VIEs. The following discussion is intended to provide supplemental information about how the application of consolidation principles impact our financial results, and management’s process for implementing those principles including areas of significant judgment.

The determination that Blackstone holds a controlling financial interest in a Blackstone Fund or investment vehicle significantly changes the presentation of our condensed consolidated financial statements. In our Condensed Consolidated Statements of Financial Position included in this filing, we present 100% of the assets and liabilities of consolidated VIEs along with a

non-controlling

interest which represents the portion of the consolidated vehicle’s interests held by third parties. However, assets of our consolidated VIEs can only be used to settle obligations of the consolidated VIE and are not available for general use by Blackstone. Further, the liabilities of our consolidated VIEs do not have recourse to the general credit of Blackstone. In the Condensed Consolidated Statements of Operations, we eliminate any management fees, Incentive Fees, or Performance Allocations received or accrued from consolidated VIEs as they are considered intercompany transactions. We recognize 100% of the consolidated VIE’s investment income (loss) and allocate the portion of that income (loss) attributable to third party ownership to

non-controlling

interests in arriving at Net Income Attributable to Blackstone Inc.

The assessment of whether we consolidate a Blackstone Fund or investment vehicle we manage requires the application of significant judgment. These judgments are applied both at the time we become involved with the VIE and on an ongoing basis and include, but are not limited to:

	•		Determining whether our management fees, Incentive Fees or Performance Allocations represent variable interests – We make judgments as to whether the fees we earn are commensurate with the level of effort required for those fees and at market rates. In making this judgment, we consider, among other things, the extent of third party investment in the entity and the terms of any other interests we hold in the VIE.

	•		Determining whether kick-out rights are substantive – We make judgments as to whether the third party investors in a partnership entity have the ability to remove the general partner, the investment manager or its equivalent, or to dissolve (liquidate) the partnership entity, through a simple majority vote. This includes an evaluation of whether barriers to exercise these rights exist.

	•		Concluding whether Blackstone has an obligation to absorb losses or the right to receive benefits that could potentially be significant to the VIE – As there is no explicit threshold in GAAP to define “potentially significant,” management must apply judgment and evaluate both quantitative and qualitative factors to conclude whether this threshold is met.

Revenue Recognition

For a description of our accounting policy on revenue recognition, see Note 2. “Summary of Significant Accounting Policies — Revenue Recognition” in the “Notes to Condensed Consolidated Financial Statements” in “Part I. Item 1. Financial Statements.” For an additional description of the nature of our revenue arrangements, including how management fees, Incentive Fees, and Performance Allocations are generated, please refer to “Part I. Item 1. Business — Fee Structure/Incentive Arrangements” in our Annual Report on

Form 10-K

for the year ended December 31, 2021. The following discussion is intended to provide supplemental information about how the application of revenue recognition principles impact our financial results, and management’s process for implementing those principles including areas of significant judgment.

Management and Advisory Fees, Net

— Blackstone earns base management fees from its customers at a fixed percentage of a calculation base which is typically assets under management, net asset value, gross asset value, total assets, committed capital or invested capital. The range of management fee rates and the calculation base from which they are earned, generally, are as follows:

On private equity, real estate, and certain of our hedge fund solutions and credit-focused funds:

	•		0.25% to 1.75% of committed capital or invested capital during the investment period,

	•		0.25% to 1.50% of invested capital, committed capital or investment fair value subsequent to the investment period for private equity and real estate funds, and

	•		1.00% to 1.50% of invested capital or net asset value subsequent to the investment period for certain of our hedge fund solutions and credit-focused funds.

On real estate and credit-focused funds structured like hedge funds:

	•		0.50% to 1.00% of net asset value.

On credit separately managed accounts:

	•		0.20% to 1.35% of net asset value or total assets.

On real estate separately managed accounts:

	•		0.65% to 2.00% of invested capital, net operating income or net asset value.

On Insurance separately managed accounts and investment vehicles:

	•		0.25% to 1.00% of net asset value.

On funds of hedge funds, certain hedge funds and separately managed accounts invested in hedge funds:

	•		0.20% to 1.50% of net asset value.

On CLO vehicles:

	•		0.20% to 0.50% of the aggregate par amount of collateral assets, including principal cash.

On credit-focused registered and

non-registered

investment companies:

	•		0.25% to 1.25% of total assets or net asset value.

The investment adviser of BXMT receives annual management fees based on 1.50% of BXMT’s net proceeds received from equity offerings and accumulated “distributable earnings” (which is generally equal to its GAAP net income excluding certain

non-cash

and other items), subject to certain adjustments. The investment advisers of BREIT and BEPIF receive a management fee of 1.25% per annum of net asset value, payable monthly.

Management fee calculations based on committed capital or invested capital are mechanical in nature and therefore do not require the use of significant estimates or judgments. Management fee calculations based on net asset value, total assets, or investment fair value depend on the fair value of the underlying investments within the funds. Estimates and assumptions are made when determining the fair value of the underlying investments within the funds and could vary depending on the valuation methodology that is used as well as economic conditions. See “— Fair Value” below for further discussion of the judgment required for determining the fair value of the underlying investments.

Investment Income (Loss)

— Performance Allocations are made to the general partner based on cumulative fund performance to date, subject to a preferred return to limited partners. Blackstone has concluded that investments made alongside its limited partners in a partnership which entitle Blackstone to a Performance Allocation represent equity method investments that are not in the scope of the GAAP guidance on accounting for revenues from contracts with customers. Blackstone accounts for these arrangements under the equity method of accounting. Under the equity method, Blackstone’s share of earnings (losses) from equity method investments is determined using a balance sheet approach referred to as the hypothetical liquidation at book value (“HLBV”) method. Under the HLBV method, at the end of each reporting period Blackstone calculates the accrued Performance Allocations that would be due to Blackstone for each fund pursuant to the fund agreements as if the fair value of the underlying investments were realized as of such date, irrespective of whether such amounts have been realized. Performance Allocations are subject to clawback to the extent that the Performance Allocation received to date exceeds the amount due to Blackstone based on cumulative results.

The change in the fair value of the investments held by certain Blackstone Funds is a significant input into the accrued Performance Allocation calculation and accrual for potential repayment of previously received Performance Allocations. Estimates and assumptions are made when determining the fair value of the underlying investments within the funds. See “— Fair Value” below for further discussion related to significant estimates and assumptions used for determining fair value of the underlying investments.

Fair Value

Blackstone uses fair value throughout the reporting process. For a description of our accounting policies related to valuation, see Note 2. “Summary of Significant Accounting Policies — Fair Value of Financial Instruments” and “Summary of Significant Accounting Policies — Investments, at Fair Value” in the “Notes to

Condensed Consolidated Financial Statements” in “Part I. Item 1. Financial Statements” of this filing. The following discussion is intended to provide supplemental information about how the application of fair value principles impact our financial results, and management’s process for implementing those principles including areas of significant judgment.

The fair value of the investments held by Blackstone Funds is the primary input to the calculation of certain of our management fees, Incentive Fees, Performance Allocations and the related Compensation we recognize. The Blackstone Funds are accounted for as investment companies under the American Institute of Certified Public Accountants Accounting and Auditing Guide,

Investment Companies

, and in accordance with the GAAP guidance on investment companies and reflect their investments, including majority owned and controlled investments (the “Portfolio Companies”), at fair value. In the absence of observable market prices, we utilize valuation methodologies applied on a consistent basis and assumptions that we believe market participants would use to determine the fair value of the investments. For investments where little market activity exists management’s determination of fair value is based on the best information available in the circumstances, which may incorporate management’s own assumptions and involves a significant degree of judgment, and the consideration of a combination of internal and external factors, including the appropriate risk adjustments for

non-performance

and liquidity risks.

Blackstone has also elected the fair value option for certain instruments it owns directly, including loans and receivables and investments in private debt securities and other proprietary investments. Blackstone is required to measure certain financial instruments at fair value, including debt instruments, equity securities and freestanding derivatives.

Fair Value of Investments or Instruments that are Publicly Traded

Securities that are publicly traded and for which a quoted market exists will be valued at the closing price of such securities in the principal market in which the security trades, or in the absence of a principal market, in the most advantageous market on the valuation date. When a quoted price in an active market exists, no block discounts or control premiums are permitted regardless of the size of the public security held. In some cases, securities will include legal restrictions limiting their purchase and sale for a period of time, such as may be required under SEC Rule 144. A discount to publicly traded price may be appropriate in those cases; the amount of the discount, if taken, shall be determined based on the time period that must pass before the restricted security becomes unrestricted or otherwise available for sale.

Fair Value of Investments or Instruments that are not Publicly Traded

Investments for which market prices are not observable include private investments in the equity or debt of operating companies or real estate properties. Our primary methodology for determining the fair values of such investments is generally the income approach which provides an indication of fair value based on the present value of cash flows that a business, security, or property is expected to generate in the future. The most widely used methodology under the income approach is the discounted cash flow method which includes significant assumptions about the underlying investment’s projected net earnings or cash flows, discount rate, capitalization rate and exit multiple. Our secondary methodology, generally used to corroborate the results of the income approach, is typically the market approach. The most widely used methodology under the market approach relies upon valuations for comparable public companies, transactions, or assets, and includes making judgments about which companies, transactions, or assets are comparable. Depending on the facts and circumstances associated with the investment, different primary and secondary methodologies may be used including option value, contingent claims or scenario analysis, yield analysis, projected cash flow-through maturity or expiration, probability weighted methods or recent round of financing.

In certain cases debt and equity securities 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 and market transactions in comparable investments and various relationships between investments.

Management Process on Fair Value

Due to the importance of fair value throughout the condensed consolidated financial statements and the significant judgment required to be applied in arriving at those fair values, we have developed a process around valuation that incorporates several levels of approval and review from both internal and external sources. Investments held by Blackstone Funds and investment vehicles are valued on at least a quarterly basis by our internal valuation or asset management teams, which are independent from our investment teams.

For investments valued utilizing the income method, and where Blackstone has information rights, we generally have a direct line of communication with each of the portfolio company finance teams and collect financial data used to support projections used in a discounted cash flow analysis. The respective business unit’s valuation team then analyzes the data received and updates the valuation models reflecting any changes in the underlying cash flow projections, weighted-average cost of capital, exit multiple, and any other valuation input relevant economic conditions.

The results of all valuations of investments held by Blackstone Fund and investment vehicles are reviewed and approved by the relevant business unit’s valuation

sub-committee,

which is comprised of key personnel from the business unit, typically the chief investment officer, chief operating officer, chief financial officer, chief compliance officer (or their respective equivalents where applicable) and other senior managing directors in the business. To further corroborate results, each business unit also generally obtains either a positive assurance opinion or a range of value from an independent valuation party, at least annually for internally prepared valuations for investments that have been held by Blackstone Funds and investment vehicles for greater than a year and quarterly for certain investments. Our firmwide valuation committee, chaired by our Chief Financial Officer and comprised of senior members of our businesses and representatives from corporate functions, including legal and finance, reviews the valuation process for investments held by us and our investment vehicles, including the application of appropriate valuation standards on a consistent basis. Each quarter, the valuation process is also reviewed by the audit committee of our board of directors, which is comprised of our employee directors.

Income Tax

For a description of our accounting policy on taxes and additional information on taxes see Note 2. “Summary of Significant Accounting Policies” in “Part II. Item 8. Financial Statements and Supplementary Data” in our Annual Report on Form

10-K

for the year ended December 31, 2021. For additional information on taxes see Note 13. “Income Taxes” in the “Notes to Condensed Consolidated Financial Statements” in “— Item 8. Financial Statements and Supplementary Data” of this filing and Note 15. “Income Taxes” in “Part II. Item 8. Financial Statements and Supplementary Data” in our Annual Report on Form

10-K

for the year ended December 31, 2021.

Our provision for income taxes is composed of current and deferred taxes. Current income taxes approximate taxes to be paid or refunded for the current period. Deferred income taxes reflect the net tax effects of temporary differences between the financial reporting and tax bases of assets and liabilities and are measured using the applicable enacted tax rates and laws that will be in effect when such differences are expected to reverse. Blackstone’s conversion from a limited partnership to a corporation resulted in a

step-up

in the tax basis of certain assets that will be recovered as those assets are sold or the basis is amortized.

Additionally, significant judgment is required in estimating the provision for (benefit from) income taxes, current and deferred tax balances (including valuation allowance), accrued interest or penalties and uncertain tax positions. In evaluating these judgments, we consider, among other items, projections of taxable income (including the character of such income), beginning with historic results and incorporating assumptions of the amount of future pretax operating income. These assumptions about future taxable income require significant judgment and are consistent with the plans and estimates that Blackstone uses to manage its business. A portion of the deferred tax assets are not considered to be more likely than not to be realized due to the character of income necessary for recovery. For that portion of the deferred tax assets, a valuation allowance has been recorded.

Revisions in estimates and/or actual costs of a tax assessment may ultimately be materially different from the recorded accruals and unrecognized tax benefits, if any.

Recent Accounting Developments

Information regarding recent accounting developments and their impact on Blackstone, if any, can be found in Note 2. “Summary of Significant Accounting Policies” in the “Notes to Condensed Consolidated Financial Statements” in “Part I. Item 1. Financial Statements” of this filing.

Interbank Offered Rates Transition

Certain jurisdictions are currently reforming or phasing out their benchmark interest rates, most notably the London Interbank Offered Rates (“LIBOR”) across multiple currencies. Many such reforms and phase outs became effective at the end of calendar year 2021 with select U.S. dollar LIBOR tenors persisting through June 2023. Blackstone has taken steps to prepare for and mitigate the impact of changing base rates and continues to evaluate the impact of prospective changes on existing transactions and contractual arrangements and manage transition efforts. See “Part I. Item 1A. Risk Factors — Risks Related to Our Business — Interest rates on our and our portfolio companies’ outstanding financial instruments might be subject to change based on regulatory developments, which could adversely affect our revenue, expenses and the value of those financial instruments.” in our Annual Report on Form

10-K

for the year ended December 31, 2021.