Carlyle Group Inc.

Carlyle is a global investment firm that manages $477 billion in Assets Under Management (AUM) ⁴ as of December 31, 2025. The firm operates across three business segments: Global Private Equity, Global Credit, and Carlyle AlpInvest. Carlyle's business model is centered on deploying private capital across a range of strategies, leveraging deep industry expertise, local insights, and global resources to generate returns. The company generates revenue primarily through fund management fees and performance allocations (carried interest and incentive fees) from its investment funds. Management fees for closed-end carry funds are typically based on limited partners' capital commitments, invested capital, or invested and committed capital, while open-end funds and Business Development Companies (BDCs) generally base fees on net asset value or gross assets. Performance allocations are residual profit allocations to the general partner, subject to preferred return hurdles and return of certain fund costs. Carlyle also makes significant capital commitments to its funds, generally up to 3% ¹⁵⁸ of all capital commitments, to align interests with investors.

The Global Private Equity (GPE) segment advises buyout, growth, real estate, infrastructure, and natural resources funds. As of December 31, 2025, GPE had $164 billion in AUM ¹⁵⁹, representing 34% ¹⁶⁰ of total AUM, with $101 billion in Fee-earning AUM ¹⁶¹. The segment includes Corporate Private Equity ($104.3 billion in AUM) ¹⁶², Real Estate ($36.0 billion in AUM) ¹⁶³, and Infrastructure & Natural Resources ($23.3 billion in AUM) ¹⁶⁴. Corporate Private Equity focuses on corporate buyouts, strategic minority investments, and disruptive growth opportunities, investing $5.9 billion ¹⁶⁵ in 2025 and realizing $11.3 billion ¹⁶⁶ of proceeds. Real Estate invests in U.S. and European residential, senior living, industrial, and self-storage properties, deploying $2.2 billion ¹⁶⁷ and realizing $1.6 billion ¹⁶⁸ in 2025. Infrastructure & Natural Resources invests in renewables, energy infrastructure, water and waste, transportation, digital infrastructure, and power generation, deploying $2.3 billion ¹⁶⁹ and realizing $5.2 billion ¹⁷⁰ in 2025.

The Global Credit (GC) segment advises products across the credit spectrum, including liquid credit, opportunistic credit, direct lending, asset-backed finance, aviation finance, infrastructure credit, and cross-platform credit products. As of December 31, 2025, GC AUM was $211.3 billion ¹⁷¹, representing 44% ¹⁷² of total AUM, with $169 billion in Fee-earning AUM ¹⁷³. Key areas include Insurance Solutions ($86.9 billion in AUM) ¹⁷⁴, Liquid Credit ($50.1 billion in AUM) ¹⁷⁵, and Private Credit ($74.4 billion in AUM) ¹⁷⁶. Carlyle Insurance Solutions oversees investments in reinsurance companies, with AUM related to capital raised for equity investments of $6.5 billion ¹⁷⁷ and total AUM related to strategic advisory services agreements of $80.4 billion ¹⁷⁸. Liquid Credit, primarily through Collateralized Loan Obligations (CLOs), closed nine new CLOs ¹⁷⁹ with an aggregate size of $4.8 billion ¹⁸⁰ in 2025. The Global Capital Markets strategy generated $206.0 million ¹⁸¹ in portfolio advisory and transaction fees for the year ended December 31, 2025.

The Carlyle AlpInvest segment, formerly Global Investment Solutions, provides investment opportunities through fund of funds, secondary purchases or financings of existing portfolios, and managed co-investment programs. As of December 31, 2025, Carlyle AlpInvest had $102 billion in AUM ¹⁸², representing 21% ¹⁸³ of total AUM, with $66 billion in Fee-earning AUM ¹⁸⁴. Its primary areas of focus include Private Equity Secondary & Portfolio Finance Investments ($45.7 billion in AUM) ¹⁸⁵, Private Equity Co-investments ($24.1 billion in AUM) ¹⁸⁶, and Private Equity Fund Investments ($25.0 billion in AUM) ¹⁸⁷. The segment also includes closed-end tender offer CAPM and CAPS funds, which had $7.2 billion ¹⁸⁸ in AUM as of December 31, 2025.

For the fiscal year ended December 31, 2025, Carlyle's AUM grew 8% ⁵ to $477 billion ⁶ from $441 billion ⁷ as of December 31, 2024. This increase was driven by inflows of $53.7 billion ⁸ in 2025, a 32% ⁹ increase from 2024. The company deployed $54.5 billion ¹⁰ across its platform and realized proceeds of $34.1 billion ¹¹ for its carry fund investors. Carlyle returned approximately $0.9 billion ¹² in capital to shareholders, including $505 million ¹³ in dividends and $400 million ¹⁴ used to repurchase 7.5 million shares ¹⁵ of common stock.

Year-over-year, GPE realized proceeds of $18.2 billion ¹⁷ for carry fund investors in 2025, an increase from prior year levels, and deployed $10.4 billion ¹⁸. Inflows of $7.5 billion ¹⁹ in GPE were driven by final closes in CRP X and CAP VI, fundraising in life sciences, and subscriptions in CPI. GC AUM increased 10% ²⁰ year-over-year to $211 billion ²¹, with inflows of $28.3 billion ²². GC deployment of $29.9 billion ²³ in 2025 more than doubled compared to 2023 levels. Carlyle AlpInvest AUM increased 20% ²⁴ year-over-year to $102 billion ²⁵, driven by $17.9 billion ²⁶ of inflows, and deployed $14.2 billion ²⁷ while realizing $10.3 billion ²⁸ in proceeds.

Significant operational developments in 2025 included the listing of Orion Breweries in Japan, Hexaware in India, and Medline in the United States, reflecting successful initial public offerings from the GPE segment. The Global Credit segment priced 39 CLOs ²⁹, including the closing of nine new CLO issuances ³⁰. The Carlyle AlpInvest segment saw fundraising in its secondaries & portfolio finance, CAPM, and newly launched CAPS funds.

Management's specific guidance for the upcoming period is not explicitly provided in the filing.

Carlyle intends to grow its businesses by increasing AUM in existing businesses, pursuing new investment strategies, developing new types of investment structures and products, expanding into new geographic markets, and seeking investments from investor bases not traditionally pursued, such as individual investors. The firm's organic growth strategy focuses on providing resources to foster business expansion to achieve scale and profitability. In the Global Private Equity segment, inflows of $7.5 billion ¹⁹ in 2025 reflected final closes in its tenth and largest U.S. real estate fund (CRP X) and its sixth Asia buyout fund (CAP VI), fundraising in its life sciences platform, and subscriptions in its evergreen real estate offering (CPI). The Global Credit segment's AUM increased 10% ²⁰ year-over-year to $211 billion ²¹, driven by inflows of $28.3 billion ²² across diverse strategies, with deployment of $29.9 billion ²³ in 2025 more than doubling 2023 levels due to strong direct lending originations and sustained structured credit product activity. The Carlyle AlpInvest segment's AUM increased 20% ²⁴ year-over-year to $102 billion ²⁵, driven by $17.9 billion ²⁶ of inflows primarily from fundraising in its secondaries & portfolio finance, CAPM, and newly launched CAPS funds.

Operationally, Carlyle's Global Capital Markets strategy had a record year, driving $206.0 million ¹⁸¹ of portfolio advisory and transaction fees for the year ended December 31, 2025. The firm is leveraging technological innovations and artificial intelligence tools to enhance operational efficiency across the deal lifecycle, from sourcing and diligence to exits, aiming to democratize access to data analysis and automate routine tasks. Carlyle's Global Portfolio Solutions team supports investment processes and portfolio companies through its global network, industry knowledge, and operational expertise, including information technology resources, a dedicated digital group, and a leveraged purchasing effort for portfolio companies. The firm also invests in a framework and resources for understanding, monitoring, and managing material environmental, social, and governance (ESG) risks and opportunities across its portfolio.

Carlyle's planned capital allocation includes returning capital to shareholders. During 2025, the company paid dividends to common shareholders of $505 million ¹³ and used $400 million ¹⁴ to repurchase 7.5 million shares ¹⁵ of common stock. The firm generally commits up to 1% ¹⁸⁹ of capital commitments to its Global Private Equity and Global Credit carry funds, with potential for additional investments in new areas. As of February 27, 2026, there were 17.6 million ¹⁹⁰ remaining shares of common stock available for grant under the Equity Incentive Plan.

Management explicitly flagged several structural headwinds and execution risks to the growth plan. The market for qualified professionals is extremely competitive, and Carlyle may not be successful in recruiting, retaining, and motivating talented personnel, potentially leading to upward pressure on compensation packages. The firm's expansion into new investment strategies, geographic markets, businesses, and types of investors, or new strategic initiatives, may result in additional risks and uncertainties, including the required investment of capital and other resources, delays or failures to complete acquisitions, and challenges in integrating operational and management systems. The use of artificial intelligence technology could lead to data exposure, misuse, or failure, increasing competitive, operational, legal, and regulatory risks.

Geographic, regulatory, and macro factors identified as constraints include adverse economic and market conditions globally, which could reduce investment fund values, fundraising ability, and ultimately revenue, earnings, and cash flow. Geopolitical tensions, such as those in the Taiwan Strait, could disrupt global supply chains and impact sectors reliant on critical hardware components. Rapidly developing and changing global data security and privacy laws and regulations could increase compliance costs and subject the firm to enforcement risks. Extensive regulation of the business, including by the SEC, CFTC, and other global regulators, creates potential for significant liabilities and penalties. Financial regulations and changes in the United States, such as the Dodd-Frank Act and proposed rules on incentive-based compensation, could adversely affect the business. Regulatory initiatives in jurisdictions outside the United States, including the EU's AIFMD II and the UK's IFPR, impose more onerous requirements and could increase compliance costs, limit market access, and impede capital flows. Laws and regulations on foreign direct investment, such as CFIUS in the U.S. and similar measures in other countries, may make it more difficult to deploy capital or sell assets. Increasing scrutiny from stakeholders on sustainability matters and ESG reporting exposes the firm to reputational and other risks, including accusations of "greenwashing."

Carlyle faces substantial risks from adverse economic and market conditions globally, including changes in interest rates, inflation, and geopolitical tensions, which could reduce the value of investments, hinder fundraising, and decrease revenue, earnings, and cash flow. For instance, persistently large fiscal deficits and high capital expenditures have increased longer-dated yields, and credit spreads, currently near historic lows, could widen, increasing financing rates even with reduced policy rates. The firm's use of leverage, including $1,875.0 million ¹⁹¹ in senior and junior subordinated notes and a $1.0 billion ¹⁹² revolving facility, exposes it to refinancing risks and potential credit rating downgrades. Operational risks, including cybersecurity threats, data breaches, and misuse of artificial intelligence, could disrupt businesses, lead to losses, and limit growth, with the potential for significant financial loss, increased costs, and regulatory investigations. Rapidly evolving global data security and privacy laws, such as the SEC's amendments to Regulation S-P taking effect in December 2025, impose challenging notification requirements and deadlines, increasing compliance costs. Extensive regulation by governmental agencies and self-regulatory organizations, including the SEC and CFTC, creates potential for significant liabilities and penalties, with the SEC's proposed rules on private funds and advisers potentially increasing compliance burdens and litigation risk. Regulatory initiatives outside the U.S., such as AIFMD II, effective April 16, 2026, impose more onerous delegation transparency, enhanced substance requirements, and additional liquidity management provisions, which could increase costs and limit operations. Laws on foreign direct investment, like the U.S. Outbound Order identifying China, Hong Kong, and Macau as "countries of concern" ¹⁹³, could limit the ability to raise and deploy capital in certain jurisdictions. Increasing scrutiny on sustainability matters and ESG reporting exposes Carlyle to reputational damage and regulatory scrutiny, particularly regarding "greenwashing" accusations.

Management's message to shareholders emphasizes a clarity of purpose, adaptability, and alignment of interests among fund investors, shareholders, and other stakeholders, striving to deliver attractive returns throughout investment cycles. The firm aims to invest wisely and create value by challenging the status quo and leveraging diverse perspectives, fostering collaboration, and encouraging employees to seek a leading edge. Carlyle returned approximately $0.9 billion ¹² in capital to shareholders during 2025, including $505 million ¹³ in dividends and $400 million ¹⁴ used to repurchase 7.5 million shares ¹⁵ of common stock. Strategic priorities include growing AUM in existing businesses, pursuing new investment strategies, developing new investment structures and products, expanding into new geographic markets, and attracting new investor segments, particularly individual investors. Management also highlights leveraging technological innovations and artificial intelligence tools to enhance operational efficiency and investing in a framework for understanding, monitoring, and managing material environmental, social, and governance (ESG) risks and opportunities across its portfolio.