AllianceBernstein ramps private markets to offset equity outflows, targeting $90–$100B AUM

NASHVILLE, Feb 5 (Reuters) — AllianceBernstein leans into private markets as a central growth strategy, accelerating expansion of higher‑margin, less liquid businesses to counter active equity outflows. The firm reports private markets assets under management (AUM) at $82 billion, up 18% year‑over‑year, following $10.6 billion of active net inflows into alternatives and multi‑asset products. Management says this momentum positions private markets to reach a $90–$100 billion AUM target by 2027, making it a primary contributor to long‑term fee growth and revenue diversification.

Executives are translating private markets growth into improved adjusted operating performance, with adjusted base management fees rising 5% and adjusted operating income up 4% for the year. AllianceBernstein highlights expansion of adjusted operating margins by 140 basis points to 33.7%, driven in part by the higher fee profile of private and alternative strategies and disciplined cost management. CEO Seth Bernstein says the firm delivers “disciplined execution and strategic progress,” framing private markets as a structural response to volatile public markets and as a source of more stable, sticky AUM.

The firm is also using private market scale to underpin product development and distribution efforts, aiming to deepen client relationships and capture long‑duration commitments that offset short‑term redemptions in active equity. Management emphasizes the operational focus on growing private capabilities — from origination and portfolio construction to client servicing — while maintaining targets for scale and fee accretion into 2027. The shift toward alternatives and multi‑asset channels reflects an industrywide move among asset managers to boost recurring, higher‑margin revenues amid changing investor demand.

Earnings and distributions

AllianceBernstein reports GAAP diluted net income of $0.90 per unit for the quarter and adjusted diluted net income of $0.96 per unit; the declared cash distribution is $0.96 per unit. For the full year, adjusted earnings per unit rise modestly while GAAP earnings per unit decline, underscoring near‑term pressure on reported results even as adjusted metrics and margins improve.

Flows and AUM snapshot

The firm reports record firmwide AUM of $867 billion despite firmwide active net outflows of $9.4 billion, driven primarily by $22.5 billion of active equity redemptions. Active fixed income records tax‑exempt inflows of $11.6 billion that partially offset taxable outflows; full‑year sales exceed $140 billion, supporting the firm’s asset mix shift toward private markets and multi‑asset solutions.