Ares Management said its assets under management (AUM) climbed past the $600 billion threshold in the fourth quarter, driven by strong fundraising activity amid persistent investor interest in private credit.
The alternative asset manager reported $35.9 billion of gross new capital raised during the quarter, bringing total AUM to $622.5 billion. The firm reiterated its strategic objective of surpassing $750 billion in assets by 2028.
Institutional demand for private credit has held up even as market participants weigh concerns about stress within the sector. Investors appear to be attracted to private credit as a means of securing higher yields and diversifying beyond public markets, supporting continued fundraising momentum for managers such as Ares.
CEO Michael Arougheti commented on investor appetite, saying: "Robust investor demand across all three of our channels is continuing and we expect another strong year of fundraising which could match or exceed our record levels from 2025."
Analysts and market observers will be closely watching upcoming earnings reports from alternative asset managers as they evaluate the sector's exposure to software companies - an area that has drawn heightened attention because of potential disruption from artificial intelligence technologies.
Ares disclosed that its investment exposure to the software industry accounts for 6% of its total assets and under 9% of its private credit portfolio, quantifying the firm's direct link to that sector.
The private credit market has been under increased scrutiny since September, after the twin bankruptcies of auto-parts maker First Brands and subprime lender Tricolor raised concerns about credit stress in the non-bank lending space. Ares noted that it deployed $45.8 billion of capital during the fourth quarter, with the majority allocated to U.S. and European direct lending, real estate and alternative credit strategies.
On a reported basis, Ares' quarterly after-tax realized income was $1.45 per share, up from $1.23 per share a year earlier.
As one of the largest alternative asset managers with a strong credit orientation, Ares has also expanded its capabilities in real estate and digital infrastructure through the acquisition of GCP International. The firm became a member of the S&P 500 index in December, marking another milestone in its growth trajectory.
Investors will likely continue to balance the firm's fundraising strength and deployment activity against the lingering uncertainties in parts of private credit and concentrated exposures to specific industries such as software.