KKR Reports 41% Revenue Growth to $4.79B, Net Income Declines Due to Increased Insurance Claims

KKR & Co. Inc. reported significant financial performance improvements in its latest 10-Q filing for the quarter ending September 30, 2024. Total revenues reached $4.79 billion, a substantial increase of $1.48 billion compared to $3.32 billion in the same quarter of 2023. For the nine months ended September 30, 2024, revenues totaled $18.62 billion, up from $10.07 billion in the prior year, reflecting a growth of $8.55 billion.

The Asset Management and Strategic Holdings segments contributed notably to this growth, generating $2.27 billion in revenues for Q3 2024, compared to $1.67 billion in Q3 2023. Fees and other revenues in this segment rose to $1.11 billion, up from $655 million in the previous year. The Insurance segment also saw a remarkable increase in net premiums, which surged to $621 million in Q3 2024 from $220 million in Q3 2023.

Despite the revenue growth, KKR's net income attributable to the company decreased to $600.55 million for Q3 2024, down from $1.47 billion in Q3 2023. This decline was primarily due to increased net policy benefits and claims expenses recognized by Global Atlantic, KKR's insurance subsidiary, which rose to $2.42 billion from $747 million year-over-year. For the nine-month period, net income attributable to KKR was $1.95 billion, down from $2.64 billion in the same period of 2023.

Total expenses for the third quarter increased to $4.75 billion, up from $2.32 billion in Q3 2023, driven by higher net policy benefits and claims, as well as increased compensation and benefits expenses. The insurance operating earnings for Q3 2024 were revised to $239 million, reflecting adjustments in policy benefits.

KKR's total assets as of September 30, 2024, amounted to $360.66 billion, an increase from $317.29 billion at the end of 2023. Total liabilities also rose to $298.86 billion from $258.92 billion. The company’s stockholders' equity increased to $24.08 billion from $22.86 billion during the same period.

Strategically, KKR completed the acquisition of Global Atlantic on January 2, 2024, for approximately $2.6 billion, consolidating its insurance operations. The company has also established a new reporting segment, Strategic Holdings, focusing on its core private equity strategy, which is now reported separately from the Asset Management segment.

Overall, KKR's performance reflects a robust growth trajectory in revenues, although profitability was impacted by rising insurance claims and expenses. The company continues to expand its investment strategies and consolidate its insurance operations, positioning itself for future growth.