10-Q - BX - Equibles

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 2022

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO

Commission File Number: 001-33551

Blackstone Inc.

(Exact name of Registrant as specified in its charter)

Delaware<br><br>(State or other jurisdiction of<br><br>incorporation or organization)	20-8875684<br><br>(I.R.S. Employer<br><br>Identification No.)

345 Park Avenue

New York, New York 10154

(Address of principal executive offices)(Zip Code)

(212) 583-5000

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	BX	New York Stock Exchange

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer <br>☒	Accelerated filer <br>☐
Non-accelerated<br> filer <br>☐	Smaller reporting company <br>☐
	Emerging growth company <br>☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of July 29, 2022, there were 701,673,387 shares of common stock of the registrant outstanding.

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Part I.	Financial Information
Item 1.	Financial Statements	6
	Unaudited Condensed Consolidated Financial Statements:
	Condensed Consolidated Statements of Financial Condition as of June 30, 2022 and December 31, 2021	6
	Condensed Consolidated Statements of Operations for the Three and Six Months Ended June 30, 2022 and 2021	8
	Condensed Consolidated Statements of Comprehensive Income for the Three and Six Months Ended June 30, 2022 and 2021	9
	Condensed Consolidated Statements of Changes in Equity for the Three and Six Months Ended June 30, 2022 and 2021	10
	Condensed Consolidated Statements of Cash Flows for the Six Months Ended June 30, 2022 and 2021	14
	Notes to Condensed Consolidated Financial Statements	16
Item 1A.	Unaudited Supplemental Presentation of Statements of Financial Condition	65
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	67
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	141
Item 4.	Controls and Procedures	141
Part II.	Other Information
Item 1.	Legal Proceedings	142
Item 1A.	Risk Factors	142
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	143
Item 3.	Defaults Upon Senior Securities	143
Item 4.	Mine Safety Disclosures	143
Item 5.	Other Information	143
Item 6.	Exhibits	144
Signatures		146

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Forward-Looking Statements

This report may contain forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended, which reflect our current views with respect to, among other things, our operations, taxes, earnings and financial performance, and share repurchases and dividends. You can identify these forward-looking statements by the use of words such as “outlook,” “indicator,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates,” “opportunity,” “leads,” “forecast” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. We believe these factors include but are not limited to those described under the section entitled “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021, as such factors may be updated from time to time in our periodic filings with the United States Securities and Exchange Commission (“SEC”), which are accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this report and in our other periodic filings. The forward-looking statements speak only as of the date of this report, and we undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise.

Website and Social Media Disclosure

We use our website (www.blackstone.com), Facebook page (www.facebook.com/blackstone), Twitter (www.twitter.com/blackstone), LinkedIn (www.linkedin.com/company/blackstonegroup), Instagram (www.instagram.com/blackstone), SoundCloud (www.soundcloud.com/blackstone-300250613), PodBean (www.blackstone.podbean.com), Spotify (https://spoti.fi/2LJ1tHG), YouTube (www.youtube.com/user/blackstonegroup) and Apple Podcast (https://apple.co/31Pe1Gg) accounts as channels of distribution of company information. The information we post through these channels may be deemed material. Accordingly, investors should monitor these channels, in addition to following our press releases, SEC filings and public conference calls and webcasts. In addition, you may automatically receive email alerts and other information about Blackstone when you enroll your email address by visiting the “Contact Us/Email Alerts” section of our website at http://ir.blackstone.com. The contents of our website, any alerts and social media channels are not, however, a part of this report.

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

“Series I Preferred Stockholder” refers to Blackstone Partners L.L.C., the holder of the sole outstanding share of our Series I preferred stock.

“Series II Preferred Stockholder” refers to Blackstone Group Management L.L.C., the holder of the sole outstanding share of our Series II preferred stock.

“Blackstone Funds,” “our funds” and “our investment funds” refer to the funds and other vehicles that are managed by Blackstone. “Our carry funds” refers to funds managed by Blackstone that have commitment-based multi-year drawdown structures that pay carry on the realization of an investment.

We refer to our real estate opportunistic funds as Blackstone Real Estate Partners (“BREP”) funds and our real estate debt investment funds as Blackstone Real Estate Debt Strategies (“BREDS”) funds. We refer to our real estate investment trusts as “REITs,” to Blackstone Mortgage Trust, Inc., our NYSE-listed REIT, as “BXMT,” and to Blackstone Real Estate Income Trust, Inc., our non-listed REIT, as “BREIT.” We refer to our real estate funds that target substantially stabilized assets in prime markets, as Blackstone Property Partners (“BPP”) funds and our income-generating European real estate funds as Blackstone European Property Income (“BEPIF”). We refer to BREIT, BPP and BEPIF collectively as our Core+ real estate strategies.

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We refer to our flagship corporate private equity funds as Blackstone Capital Partners (“BCP”) funds, our energy-focused private equity funds as Blackstone Energy Partners (“BEP”) funds, our core private equity funds as Blackstone Core Equity Partners (“BCEP”), our opportunistic investment platform that invests globally across asset classes, industries and geographies as Blackstone Tactical Opportunities (“Tactical Opportunities”), our secondary fund of funds business as Strategic Partners Fund Solutions (“Strategic Partners”), our infrastructure-focused funds as Blackstone Infrastructure Partners (“BIP”), our life sciences investment platform, Blackstone Life Sciences (“BXLS”), our growth equity investment platform, Blackstone Growth (“BXG”), our multi-asset investment program for eligible high net worth investors offering exposure to certain of our key illiquid investment strategies through a single commitment as Blackstone Total Alternatives Solution (“BTAS”) and our capital markets services business as Blackstone Capital Markets (“BXCM”).

“Our hedge funds” refers to our funds of hedge funds, hedge funds, certain of our real estate debt investment funds, including a registered investment company, and certain other credit-focused funds which are managed by Blackstone.

We refer to our business development companies as “BDCs,” to Blackstone Private Credit Fund as “BCRED” and to Blackstone Secured Lending Fund as “BXSL.”

“BIS” refers to Blackstone Insurance Solutions, which partners with insurers to deliver capital-efficient investments tailored to each insurer’s needs and risk profile.

We refer to our separately managed accounts as “SMAs.”

“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 <br>side-by-side<br> and <br>co-investment<br> 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 <br>co-investments<br> 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 collateralized loan obligations (“CLO”) 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.
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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 <br>co-investment<br> vehicles managed by us on which we receive fees,
---	---
(d)	the net asset value of our funds of hedge funds, hedge funds, BPP, certain <br>co-investments<br> 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.

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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” 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.

This report does not constitute an offer of any Blackstone Fund.

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Part I. Financial Information

Item 1.	Financial Statements

Blackstone Inc.

Condensed Consolidated Statements of Financial Condition (Unaudited)

(Dollars in Thousands, Except Share Data)

			December 31,
			2021
Assets
Cash and Cash Equivalents	4,183,380		$	2,119,738
Cash Held by Blackstone Funds and Other	129,276			79,994
Investments (including assets pledged of 152,529 and 63,044 at June 30, 2022 and December 31, 2021, respectively)	27,323,758			28,665,043
Accounts Receivable	774,137			636,616
Due from Affiliates	3,891,958			4,656,867
Intangible Assets, Net	246,988			284,384
Goodwill	1,890,202			1,890,202
Other Assets	658,298			492,936
Right-of-Use Assets	886,911			788,991
Deferred Tax Assets	1,646,400			1,581,637
Total Assets	41,631,308		$	41,196,408
Liabilities and Equity
Loans Payable	9,365,274		$	7,748,163
Due to Affiliates	2,001,391			1,906,098
Accrued Compensation and Benefits	6,765,492			7,905,070
Securities Sold, Not Yet Purchased	27,029			27,849
Repurchase Agreements	152,529			57,980
Operating Lease Liabilities	993,875			908,033
Accounts Payable, Accrued Expenses and Other Liabilities	991,620			937,169
Total Liabilities	20,297,210			19,490,362
Commitments and Contingencies
Redeemable Non-Controlling Interests in Consolidated Entities	1,275,491			68,028
Equity
Stockholders’ Equity of Blackstone Inc.
Common Stock, 0.00001 par value, 90 billion shares authorized, (706,476,877 shares issued and outstanding as of June 30, 2022; 704,339,774 shares issued and outstanding as of December 31, 2021)	7			7
Series I Preferred Stock, 0.00001 par value, 999,999,000 shares authorized, (1 share issued and outstanding as of June 30, 2022 and December 31, 2021)	—			—
Series II Preferred Stock, 0.00001 par value, 1,000 shares authorized, (1 share issued and outstanding as of June 30, 2022 and December 31, 2021)	—			—
Additional Paid-in-Capital	5,870,285			5,794,727
Retained Earnings	2,803,100			3,647,785
Accumulated Other Comprehensive Loss	(42,225	)		(19,626	)
Total Stockholders’ Equity of Blackstone Inc.	8,631,167			9,422,893
Non-Controlling Interests in Consolidated Entities	5,281,244			5,600,653
Non-Controlling Interests in Blackstone Holdings	6,146,196			6,614,472
Total Equity	20,058,607			21,638,018
Total Liabilities and Equity	41,631,308		$	41,196,408

All values are in US Dollars.

continued...

See notes to condensed consolidated financial statements.

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Blackstone Inc.

Condensed Consolidated Statements of Financial Condition (Unaudited)

(Dollars in Thousands)

The following presents the asset and liability portion of the consolidated balances presented in the Condensed Consolidated Statements of Financial Condition attributable to consolidated Blackstone Funds which are variable interest entities. The following assets may only be used to settle obligations of these consolidated Blackstone Funds and these liabilities are only the obligations of these consolidated Blackstone Funds and they do not have recourse to the general credit of Blackstone.

	June 30,		December 31,
	2022		2021
Assets
Cash Held by Blackstone Funds and Other	$	129,276	$	79,994
Investments		3,764,850		2,018,829
Accounts Receivable		89,725		64,680
Due from Affiliates		16,026		13,748
Other Assets		273		251
Total Assets	$	4,000,150	$	2,177,502
Liabilities
Loans Payable	$	—	$	101
Due to Affiliates		84,116		95,204
Securities Sold, Not Yet Purchased		23,063		23,557
Repurchase Agreements		—		15,980
Accounts Payable, Accrued Expenses and Other Liabilities		22,356		10,420
Total Liabilities	$	129,535	$	145,262

See notes to condensed consolidated financial statements.

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Blackstone Inc.

Condensed Consolidated Statements of Operations (Unaudited)

(Dollars in Thousands, Except Share and Per Share Data)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2022			2021			2022			2021
Revenues
Management and Advisory Fees, Net	$	1,561,187		$	1,212,549		$	3,037,123		$	2,390,364
Incentive Fees		99,598			33,207			204,087			69,331
Investment Income (Loss)
Performance Allocations
Realized		2,453,769			808,620			4,220,155			1,342,987
Unrealized		(3,467,668	)		2,697,170			(2,174,618	)		5,161,667
Principal Investments
Realized		265,161			152,060			550,265			507,098
Unrealized		(500,490	)		328,835			(426,529	)		968,150
Total Investment Income (Loss)		(1,249,228	)		3,986,685			2,169,273			7,979,902
Interest and Dividend Revenue		62,075			31,017			116,560			62,429
Other		155,588			27,896			228,457			88,200
Total Revenues		629,220			5,291,354			5,755,500			10,590,226
Expenses
Compensation and Benefits
Compensation		686,012			507,104			1,342,517			1,049,742
Incentive Fee Compensation		45,363			14,431			86,382			27,756
Performance Allocations Compensation
Realized		1,035,916			347,423			1,753,517			560,450
Unrealized		(1,386,543	)		1,150,219			(914,259	)		2,200,188
Total Compensation and Benefits		380,748			2,019,177			2,268,157			3,838,136
General, Administrative and Other		289,288			205,057			529,962			390,179
Interest Expense		69,642			44,322			136,389			89,305
Fund Expenses		4,435			3,774			6,627			6,157
Total Expenses		744,113			2,272,330			2,941,135			4,323,777
Other Income (Loss)
Change in Tax Receivable Agreement Liability		(13	)		(392	)		748			2,518
Net Gains (Losses) from Fund Investment Activities		(104,326	)		127,116			(53,450	)		247,469
Total Other Income (Loss)		(104,339	)		126,724			(52,702	)		249,987
Income (Loss) Before Provision for Taxes		(219,232	)		3,145,748			2,761,663			6,516,436
Provision for Taxes		36,514			288,250			519,795			287,803
Net Income (Loss)		(255,746	)		2,857,498			2,241,868			6,228,633
Net Income Attributable to Redeemable <br>Non-Controlling<br> Interests in Consolidated Entities		25,875			637			30,927			1,266
Net Income (Loss) Attributable to <br>Non-Controlling<br> Interests in Consolidated Entities		(216,707	)		431,516			(332	)		818,366
Net Income (Loss) Attributable to <br>Non-Controlling<br> Interests in Blackstone Holdings		(35,521	)		1,116,193			1,023,792			2,351,977
Net Income (Loss) Attributable to Blackstone Inc.	$	(29,393	)	$	1,309,152		$	1,187,481		$	3,057,024
Net Income (Loss) Per Share of Common Stock
Basic	$	(0.04	)	$	1.82		$	1.61		$	4.27
Diluted	$	(0.04	)	$	1.82		$	1.61		$	4.27
Weighted-Average Shares of Common Stock Outstanding
Basic		707,382,293			721,141,954			738,752,489			715,121,029
Diluted		707,382,293			721,265,180			739,140,862			715,622,208

See notes to condensed consolidated financial statements.

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Blackstone Inc.

Condensed Consolidated Statements of Comprehensive Income (Unaudited)

(Dollars in Thousands)

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2022			2021		2022			2021
Net Income (Loss)	$	(255,746	)	$	2,857,498	$	2,241,868		$	6,228,633
Other Comprehensive Income (Loss), Currency Translation Adjustment		(60,067	)		2,124		(69,466	)		10,055
Comprehensive Income (Loss)		(315,813	)		2,859,622		2,172,402			6,238,688
Less:
Comprehensive Income (Loss) Attributable to Redeemable <br>Non-Controlling<br> Interests in Consolidated Entities		(6,855	)		637		(1,803	)		1,266
Comprehensive Income (Loss) Attributable to <br>Non-Controlling<br> Interests in Consolidated Entities		(216,707	)		431,516		(332	)		818,366
Comprehensive Income (Loss) Attributable to <br>Non-Controlling<br> Interests in Blackstone Holdings		(46,387	)		1,117,108		1,009,655			2,356,446
Comprehensive Income (Loss) Attributable to <br>Non-Controlling<br> Interests		(269,949	)		1,549,261		1,007,520			3,176,078
Comprehensive Income (Loss) Attributable to Blackstone Inc.	$	(45,864	)	$	1,310,361	$	1,164,882		$	3,062,610

See notes to condensed consolidated financial statements.

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Blackstone Inc.

Condensed Consolidated Statements of Changes in Equity (Unaudited)

(Dollars in Thousands, Except Share Data)

	Shares of<br>Blackstone<br>Inc. (a)			Blackstone Inc. (a)
												Accumulated															Redeemable
												Other						Non-			Non-						Non-
												Compre-						Controlling			Controlling						Controlling
						Additional			Retained			hensive			Total			Interests in			Interests in						Interests in
	Common			Common		Paid-in-			Earnings			Income			Stockholders’			Consolidated			Blackstone			Total			Consolidated
	Stock			Stock		Capital			(Deficit)			(Loss)			Equity			Entities			Holdings			Equity			Entities
Balance at March 31, 2022		707,180,830		$	7	$	5,879,796		$	3,805,918		$	(25,754	)	$	9,659,967		$	5,747,698		$	6,791,932		$	22,199,597		$	41,430
Transfer In Due to Consolidation of Fund Entities		—			—		—			—			—			—			—			—			—			1,146,410
Net Income (Loss)		—			—		—			(29,393	)		—			(29,393	)		(216,707	)		(35,521	)		(281,621	)		25,875
Currency Translation Adjustment		—			—		—			—			(16,471	)		(16,471	)		—			(10,866	)		(27,337	)		(32,730	)
Capital Contributions		—			—		—			—			—			—			260,428			2,477			262,905			105,467
Capital Distributions		—			—		—			(973,425	)		—			(973,425	)		(510,253	)		(692,719	)		(2,176,397	)		(10,961	)
Transfer of <br>Non-Controlling<br> Interests in Consolidated Entities		—			—		—			—			—			—			78			—			78			—
Deferred Tax Effects Resulting from Acquisition of Ownership Interests from <br>Non-Controlling<br> Interest Holders		—			—		4,257			—			—			4,257			—			—			4,257			—
Equity-Based Compensation		—			—		168,354			—			—			168,354			—			111,409			279,763			—
Net Delivery of Vested Blackstone Holdings Partnership Units and Shares of Common Stock		372,867			—		(7,312	)		—			—			(7,312	)		—			—			(7,312	)		—
Repurchase of Shares of Common Stock and Blackstone Holdings Partnership Units		(1,850,000	)		—		(195,326	)		—			—			(195,326	)		—			—			(195,326	)		—
Change in Blackstone Inc.’s Ownership Interest		—			—		9,247			—			—			9,247			—			(9,247	)		—			—
Conversion of Blackstone Holdings Partnership Units to Shares of Common Stock		773,180			—		11,269			—			—			11,269			—			(11,269	)		—			—
Balance at June 30, 2022		706,476,877		$	7	$	5,870,285		$	2,803,100		$	(42,225	)	$	8,631,167		$	5,281,244		$	6,146,196		$	20,058,607		$	1,275,491
(a)	During the period presented, Blackstone also had one share outstanding of each of Series I and Series II preferred stock, with par value of each less than one cent.
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continued...

See notes to condensed consolidated financial statements.

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Blackstone Inc.

Condensed Consolidated Statements of Changes in Equity (Unaudited)

(Dollars in Thousands, Except Share Data)

	Shares of<br>Blackstone<br>Inc. (a)			Blackstone Inc. (a)
												Accumulated															Redeemable
												Other						Non-			Non-						Non-
												Compre-						Controlling			Controlling						Controlling
						Additional			Retained			hensive			Total			Interests in			Interests in						Interests in
	Common			Common		Paid-in-			Earnings			Income			Stockholders’			Consolidated			Blackstone			Total			Consolidated
	Stock			Stock		Capital			(Deficit)			(Loss)			Equity			Entities			Holdings			Equity			Entities
Balance at March 31, 2021		690,569,563		$	7	$	6,446,829		$	1,408,768		$	(11,454	)	$	7,844,150		$	4,390,594		$	4,524,898		$	16,759,642		$	65,546
Net Income		—			—		—			1,309,152			—			1,309,152			431,516			1,116,193			2,856,861			637
Currency Translation Adjustment		—			—		—			—			1,209			1,209			—			915			2,124			—
Capital Contributions		—			—		—			—			—			—			204,933			2,551			207,484			—
Capital Distributions		—			—		—			(584,126	)		—			(584,126	)		(166,518	)		(441,687	)		(1,192,331	)		(615	)
Transfer of <br>Non-Controlling<br> Interests in Consolidated Entities		—			—		—			—			—			—			(83	)		—			(83	)		—
Deferred Tax Effects Resulting from Acquisition of Ownership Interests from <br>Non-Controlling<br> Interest Holders		—			—		9,535			—			—			9,535			—			—			9,535			—
Equity-Based Compensation		—			—		77,083			—			—			77,083			—			55,046			132,129			—
Net Delivery of Vested Blackstone Holdings Partnership Units and Shares of Common Stock		273,659			—		(4,860	)		—			—			(4,860	)		—			—			(4,860	)		—
Repurchase of Shares of Common Stock and Blackstone Holdings Partnership Units		(3,174,598	)		—		(289,055	)		—			—			(289,055	)		—			—			(289,055	)		—
Change in Blackstone Inc.’s Ownership Interest		—			—		11,322			—			—			11,322			—			(11,322	)		—			—
Conversion of Blackstone Holdings Partnership Units to Shares of Common Stock		3,424,839			—		31,746			—			—			31,746			—			(31,746	)		—			—
Balance at June 30, 2021		691,093,463		$	7	$	6,282,600		$	2,133,794		$	(10,245	)	$	8,406,156		$	4,860,442		$	5,214,848		$	18,481,446		$	65,568
(a)	During the period presented, Blackstone also had one share outstanding of each of Series I and Series II preferred stock, with par value of each less than one cent.
---	---

continued...

See notes to condensed consolidated financial statements.

Table of Contents

Blackstone Inc.

Condensed Consolidated Statements of Changes in Equity (Unaudited)

(Dollars in Thousands, Except Share Data)

	Shares of<br>Blackstone<br>Inc. (a)			Blackstone Inc. (a)
												Accumulated															Redeemable
												Other						Non-			Non-						Non-
												Compre-						Controlling			Controlling						Controlling
						Additional			Retained			hensive			Total			Interests in			Interests in						Interests in
	Common			Common		Paid-in-			Earnings			Income			Stockholders’			Consolidated			Blackstone			Total			Consolidated
	Stock			Stock		Capital			(Deficit)			(Loss)			Equity			Entities			Holdings			Equity			Entities
Balance at December 31, 2021		704,339,774		$	7	$	5,794,727		$	3,647,785		$	(19,626	)	$	9,422,893		$	5,600,653		$	6,614,472		$	21,638,018		$	68,028
Transfer In Due to Consolidation of Fund Entities		—			—		—			—			—			—			—			—			—			1,146,410
Net Income (Loss)		—			—		—			1,187,481			—			1,187,481			(332	)		1,023,792			2,210,941			30,927
Currency Translation Adjustment		—			—		—			—			(22,599	)		(22,599	)		—			(14,137	)		(36,736	)		(32,730	)
Capital Contributions		—			—		—			—			—			—			452,766			4,963			457,729			105,467
Capital Distributions		—			—		—			(2,032,166	)		—			(2,032,166	)		(763,099	)		(1,594,508	)		(4,389,773	)		(42,611	)
Transfer of <br>Non-Controlling<br> Interests in Consolidated Entities		—			—		—			—			—			—			(8,744	)		—			(8,744	)		—
Deferred Tax Effects Resulting from Acquisition of Ownership Interests from <br>Non-Controlling<br> Interest Holders		—			—		7,529			—			—			7,529			—			—			7,529			—
Equity-Based Compensation		—			—		249,255			—			—			249,255			—			165,087			414,342			—
Net Delivery of Vested Blackstone Holdings Partnership Units and Shares of Common Stock		2,265,039			—		(39,373	)		—			—			(39,373	)		—			—			(39,373	)		—
Repurchase of Shares of Common Stock and Blackstone Holdings Partnership Units		(1,850,000	)		—		(195,326	)		—			—			(195,326	)		—			—			(195,326	)		—
Change in Blackstone Inc.’s Ownership Interest		—			—		28,766			—			—			28,766			—			(28,766	)		—			—
Conversion of Blackstone Holdings Partnership Units to Shares of Common Stock		1,722,064			—		24,707			—			—			24,707			—			(24,707	)		—			—
Balance at June 30, 2022		706,476,877		$	7	$	5,870,285		$	2,803,100		$	(42,225	)	$	8,631,167		$	5,281,244		$	6,146,196		$	20,058,607		$	1,275,491
(a)	During the period presented, Blackstone also had one share outstanding of each of Series I and Series II preferred stock, with par value of each less than one cent.
---	---

continued...

See notes to condensed consolidated financial statements.

1 2

Table of Contents

Blackstone Inc.

Condensed Consolidated Statements of Changes in Equity (Unaudited)

(Dollars in Thousands, Except Share Data)

	Shares of<br>Blackstone<br>Inc. (a)			Blackstone Inc. (a)
												Accumulated															Redeemable
												Other						Non-			Non-						Non-
												Compre-						Controlling			Controlling						Controlling
						Additional			Retained			hensive			Total			Interests in			Interests in						Interests in
	Common			Common		Paid-in-			Earnings			Income			Stockholders’			Consolidated			Blackstone			Total			Consolidated
	Stock			Stock		Capital			(Deficit)			(Loss)			Equity			Entities			Holdings			Equity			Entities
Balance at December 31, 2020		683,875,544		$	7	$	6,332,105		$	335,762		$	(15,831	)	$	6,652,043		$	4,042,157		$	3,831,148		$	14,525,348		$	65,161
Net Income		—			—		—			3,057,024			—			3,057,024			818,366			2,351,977			6,227,367			1,266
Currency Translation Adjustment		—			—		—			—			5,586			5,586			—			4,469			10,055			—
Capital Contributions		—			—		—			—			—			—			412,230			5,259			417,489			—
Capital Distributions		—			—		—			(1,258,992	)		—			(1,258,992	)		(408,718	)		(1,024,657	)		(2,692,367	)		(859	)
Transfer of <br>Non-Controlling<br> Interests in Consolidated Entities		—			—		—			—			—			—			(3,593	)		—			(3,593	)		—
Deferred Tax Effects Resulting from Acquisition of Ownership Interests from <br>Non-Controlling<br> Interest Holders		—			—		19,714			—			—			19,714			—			—			19,714			—
Equity-Based Compensation		—			—		168,606			—			—			168,606			—			120,941			289,547			—
Net Delivery of Vested Blackstone Holdings Partnership Units and Shares of Common Stock		1,986,972			—		(23,059	)		—			—			(23,059	)		—			—			(23,059	)		—
Repurchase of Shares of Common Stock and Blackstone Holdings Partnership Units		(3,174,598	)		—		(289,055	)		—			—			(289,055	)		—			—			(289,055	)		—
Change in Blackstone Inc.’s Ownership Interest		—			—		3,877			—			—			3,877			—			(3,877	)		—			—
Conversion of Blackstone Holdings Partnership Units to Shares of Common Stock		8,405,545			—		70,412			—			—			70,412			—			(70,412	)		—			—
Balance at June 30, 2021		691,093,463		$	7	$	6,282,600		$	2,133,794		$	(10,245	)	$	8,406,156		$	4,860,442		$	5,214,848		$	18,481,446		$	65,568
(a)	During the period presented, Blackstone also had one share outstanding of each of Series I and Series II preferred stock, with par value of each less than one cent.
---	---

See notes to condensed consolidated financial statements.

Table of Contents

Blackstone Inc.

Condensed Consolidated Statements of Cash Flows (Unaudited)

(Dollars in Thousands)

	Six Months Ended June 30,
	2022			2021
Operating Activities
Net Income	$	2,241,868		$	6,228,633
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities
Blackstone Funds Related
Net Realized Gains on Investments		(4,983,098	)		(1,949,167	)
Changes in Unrealized (Gains) Losses on Investments		612,064			(1,140,654	)
Non-Cash<br> Performance Allocations		2,174,618			(5,161,667	)
Non-Cash<br> Performance Allocations and Incentive Fee Compensation		923,083			2,780,561
Equity-Based Compensation Expense		429,868			305,422
Amortization of Intangibles		37,396			37,476
Other <br>Non-Cash<br> Amounts Included in Net Income		(517,979	)		(153,350	)
Cash Flows Due to Changes in Operating Assets and Liabilities
Cash Acquired with Consolidation of Fund Entities		31,791			—
Accounts Receivable		(118,151	)		346,505
Due from Affiliates		844,394			109,163
Other Assets		(83,592	)		(55,225	)
Accrued Compensation and Benefits		(1,532,679	)		(440,034	)
Securities Sold, Not Yet Purchased		28			(14,925	)
Accounts Payable, Accrued Expenses and Other Liabilities		(14,460	)		13,373
Repurchase Agreements		94,549			(19,562	)
Due to Affiliates		75,291			19,836
Investments Purchased		(2,361,680	)		(2,718,024	)
Cash Proceeds from Sale of Investments		6,784,881			5,007,907
Net Cash Provided by Operating Activities		4,638,192			3,196,268
Investing Activities
Purchase of Furniture, Equipment and Leasehold Improvements		(101,396	)		(34,811	)
Net Cash Used in Investing Activities		(101,396	)		(34,811	)
Financing Activities
Distributions to <br>Non-Controlling<br> Interest Holders in Consolidated Entities		(805,688	)		(409,577	)
Contributions from <br>Non-Controlling<br> Interest Holders in Consolidated Entities		544,204			407,738
Payments Under Tax Receivable Agreement		(46,880	)		(51,366	)
Net Settlement of Vested Common Stock and Repurchase of Common Stock and Blackstone Holdings Partnership Units		(234,699	)		(312,114	)
Proceeds from Loans Payable		2,006,150			—

continued...

See notes to condensed consolidated financial statements.

Table of Contents

Blackstone Inc.

Condensed Consolidated Statements of Cash Flows (Unaudited)

(Dollars in Thousands)

	Six Months Ended June 30,
	2022			2021
Financing Activities (Continued)
Repayment and Repurchase of Loans Payable	$	(250,101	)	$	—
Dividends/Distributions to Shareholders and Unitholders		(3,621,712	)		(2,278,390	)
Net Cash Used in Financing Activities		(2,408,726	)		(2,643,709	)
Effect of Exchange Rate Changes on Cash and Cash Equivalents and Cash Held by Blackstone Funds and Other		(15,146	)		(5,084	)
Cash and Cash Equivalents and Cash Held by Blackstone Funds and Other
Net Increase		2,112,924			512,664
Beginning of Period		2,199,732			2,064,456
End of Period	$	4,312,656		$	2,577,120
Supplemental Disclosure of Cash Flows Information
Payments for Interest	$	123,915		$	102,524
Payments for Income Taxes	$	499,136		$	289,244
Supplemental Disclosure of <br>Non-Cash<br> Investing and Financing Activities
Non-Cash<br> Contributions from <br>Non-Controlling<br> Interest Holders	$	10,276		$	6,076
Notes Issuance Costs	$	18,423		$	—
Transfer of Interests to <br>Non-Controlling<br> Interest Holders	$	(8,744	)	$	(3,593	)
Change in Blackstone Inc.’s Ownership Interest	$	28,766		$	3,877
Net Settlement of Vested Common Stock	$	199,977		$	124,386
Conversion of Blackstone Holdings Units to Common Stock	$	24,707		$	70,412
Acquisition of Ownership Interests from <br>Non-Controlling<br> Interest Holders
Deferred Tax Asset	$	(58,673	)	$	(167,433	)
Due to Affiliates	$	51,144		$	147,719
Equity	$	7,529		$	19,714

The following table provides a reconciliation of Cash and Cash Equivalents and Cash Held by Blackstone Funds and Other reported within the Condensed Consolidated Statements of Financial Condition:

	June 30,		December 31,
	2022		2021
Cash and Cash Equivalents	$	4,183,380	$	2,119,738
Cash Held by Blackstone Funds and Other		129,276		79,994
	$	4,312,656	$	2,199,732

See notes to condensed consolidated financial statements.

Table of Contents

Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

1. Organization

Blackstone Inc., together with its consolidated subsidiaries (“Blackstone” or the “Company”), is one of the world’s leading investment firms. Blackstone’s asset management business includes investment vehicles focused on real estate, private equity, infrastructure, life sciences, growth equity, credit, real assets and secondary funds, all on a global basis. “Blackstone Funds” refers to the funds and other vehicles that are managed by Blackstone. Blackstone’s business is organized into four segments: Real Estate, Private Equity, Hedge Fund Solutions and Credit & Insurance.

Effective August 6, 2021, The Blackstone Group Inc. changed its name to Blackstone Inc. Blackstone Inc. was initially formed as The Blackstone Group L.P., a Delaware limited partnership, on March 12, 2007. Prior to its conversion (effective July 1, 2019) to a Delaware corporation, Blackstone Inc. was managed and operated by Blackstone Group Management L.L.C., which is wholly owned by Blackstone’s senior managing directors and controlled by one of Blackstone’s founders, Stephen A. Schwarzman (the “Founder”). Effective February 26, 2021, the Certificate of Incorporation of Blackstone Inc. was amended and restated to rename Blackstone’s Class A common stock as “common stock” and reclassify Blackstone’s Class B common stock and Class C common stock into a new Series I preferred stock and a new Series II preferred stock, respectively. All references to common stock, Series I preferred stock and Series II preferred stock prior to such date refer to Class A, Class B and Class C common stock, respectively. See Note 13. “Income Taxes” and Note 14. “Earnings Per Share and Stockholders’ Equity — Stockholders’ Equity.”

The activities of Blackstone are conducted through its holding partnerships: Blackstone Holdings I L.P., Blackstone Holdings AI L.P., Blackstone Holdings II L.P., Blackstone Holdings III L.P. and Blackstone Holdings IV L.P. (collectively, “Blackstone Holdings,” “Blackstone Holdings Partnerships” or the “Holding Partnerships”). Blackstone, through its wholly owned subsidiaries, is the sole general partner of each of the Holding Partnerships. Generally, holders of the limited partner interests in the Holding Partnerships may, four times each year, exchange their limited partnership interests (“Partnership Units”) for Blackstone common stock, on a one-to-one basis, exchanging one Partnership Unit from each of the Holding Partnerships for one share of Blackstone common stock.

2. Summary of Significant Accounting Policies

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of Blackstone have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information and the instructions to Form 10-Q. The condensed consolidated financial statements, including these notes, are unaudited and exclude some of the disclosures required in audited financial statements. Management believes it has made all necessary adjustments (consisting of only normal recurring items) so that the condensed consolidated financial statements are presented fairly and that estimates made in preparing its condensed consolidated financial statements are reasonable and prudent. The operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in Blackstone’s Annual Report on Form 10-K for the year ended December 31, 2021 filed with the Securities and Exchange Commission.

The condensed consolidated financial statements include the accounts of Blackstone, its wholly owned or majority owned subsidiaries, the consolidated entities which are considered to be variable interest entities and for which Blackstone is considered the primary beneficiary, and certain partnerships or similar entities which are not considered variable interest entities but in which the general partner is determined to have control.

Table of Contents

Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

All intercompany balances and transactions have been eliminated in consolidation.

Consolidation

Blackstone consolidates all entities that it controls through a majority voting interest or otherwise, including those Blackstone Funds in which the general partner has a controlling financial interest. Blackstone has a controlling financial interest in Blackstone Holdings because the limited partners do not have the right to dissolve the partnerships or have substantive kick-out rights or participating rights that would overcome the control held by Blackstone. Accordingly, Blackstone consolidates Blackstone Holdings and records non-controlling interests to reflect the economic interests of the limited partners of Blackstone Holdings.

In addition, Blackstone consolidates all variable interest entities (“VIE”) for which it is the primary beneficiary. An enterprise is determined to be the primary beneficiary if it holds a controlling financial interest. A controlling financial interest is defined as (a) the power to direct the activities of a VIE that most significantly impact the entity’s economic performance and (b) the obligation to absorb losses of the entity or the right to receive benefits from the entity that could potentially be significant to the VIE. The consolidation guidance requires an analysis to determine (a) whether an entity in which Blackstone holds a variable interest is a VIE and (b) whether Blackstone’s involvement, through holding interests directly or indirectly in the entity or contractually through other variable interests, would give it a controlling financial interest. Performance of that analysis requires the exercise of judgment.

Blackstone determines whether it is the primary beneficiary of a VIE at the time it becomes involved with a variable interest entity and continuously reconsiders that conclusion. In determining whether Blackstone is the primary beneficiary, Blackstone evaluates its control rights as well as economic interests in the entity held either directly or indirectly by Blackstone. The consolidation analysis can generally be performed qualitatively; however, if it is not readily apparent that Blackstone is not the primary beneficiary, a quantitative analysis may also be performed. Investments and redemptions (either by Blackstone, affiliates of Blackstone or third parties) or amendments to the governing documents of the respective Blackstone Funds could affect an entity’s status as a VIE or the determination of the primary beneficiary. At each reporting date, Blackstone assesses whether it is the primary beneficiary and will consolidate or deconsolidate accordingly.

Assets of consolidated VIEs that can only be used to settle obligations of the consolidated VIE and liabilities of a consolidated VIE for which creditors (or beneficial interest holders) do not have recourse to the general credit of Blackstone are presented in a separate section in the Condensed Consolidated Statements of Financial Condition.

Blackstone’s other disclosures regarding VIEs are discussed in Note 9. “Variable Interest Entities.”

Revenue Recognition

Revenues primarily consist of management and advisory fees, incentive fees, investment income, interest and dividend revenue and other.

Management and advisory fees and incentive fees are accounted for as contracts with customers. Under the guidance for contracts with customers, an entity is required to (a) identify the contract(s) with a customer, (b) identify the performance obligations in the contract, (c) determine the transaction price, (d) allocate the transaction price to the performance obligations in the contract, and (e) recognize revenue when (or as) the entity satisfies a performance obligation. In determining the transaction price, an entity may include variable consideration only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized would not occur when the uncertainty associated with the variable consideration is resolved. See Note 18. “Segment Reporting” for a disaggregated presentation of revenues from contracts with customers.

Table of Contents

Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

Management and Advisory Fees, Net — Management and Advisory Fees, Net are comprised of management fees, including base management fees, transaction and other fees and advisory fees net of management fee reductions and offsets.

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. Blackstone identifies its customers on a fund by fund basis in accordance with the terms and circumstances of the individual fund. Generally, the customer is identified as the investors in its managed funds and investment vehicles, but for certain widely held funds or vehicles, the fund or vehicle itself may be identified as the customer. These customer contracts require Blackstone to provide investment management services, which represents a performance obligation that Blackstone satisfies over time. Management fees are a form of variable consideration because the fees Blackstone is entitled to vary based on fluctuations in the basis for the management fee. The amount recorded as revenue is generally determined at the end of the period because these management fees are payable on a regular basis (typically quarterly) and are not subject to clawback once paid.

Transaction, advisory and other fees are principally fees charged to the investors of funds indirectly through the managed funds and portfolio companies. The investment advisory agreements generally require that the investment adviser reduce the amount of management fees payable by the investors to Blackstone (“management fee reductions”) by an amount equal to a portion of the transaction and other fees paid to Blackstone by the portfolio companies. The amount of the reduction varies by fund, the type of fee paid by the portfolio company and the previously incurred expenses of the fund. These fees and associated management fee reductions are a component of the transaction price for Blackstone’s performance obligation to provide investment management services to the investors of funds and are recognized as changes to the transaction price in the period in which they are charged and the services are performed.

Management fee offsets are reductions to management fees payable by the investors of the Blackstone Funds, which are based on the amount such investors reimburse the Blackstone Funds or Blackstone primarily for placement fees. Providing investment management services requires Blackstone to arrange for services on behalf of its customers. In those situations where Blackstone is acting as an agent on behalf of the investors of funds, it presents the cost of services as net against management fee revenue. In all other situations, Blackstone is primarily responsible for fulfilling the services and is therefore acting as a principal for those arrangements. As a result, the cost of those services is presented as Compensation or General, Administrative and Other expense, as appropriate, with any reimbursement from the investors of the funds recorded as Management and Advisory Fees, Net. In cases where the investors of the funds are determined to be the customer in an arrangement, placement fees may be capitalized as a cost to acquire a customer contract. Capitalized placement fees are amortized over the life of the customer contract, are recorded within Other Assets in the Condensed Consolidated Statements of Financial Condition and amortization is recorded within General, Administrative and Other within the Condensed Consolidated Statements of Operations.

Accrued but unpaid Management and Advisory Fees, net of management fee reductions and management fee offsets, as of the reporting date are included in Accounts Receivable or Due from Affiliates in the Condensed Consolidated Statements of Financial Condition.

Incentive Fees — Contractual fees earned based on the performance of Blackstone Funds (“Incentive Fees”) are a form of variable consideration in Blackstone’s contracts with customers to provide investment management services. Incentive Fees are earned based on fund performance during the period, subject to the achievement of minimum return levels, or high water marks, in accordance with the respective terms set out in each fund’s governing agreements. Incentive Fees will not be recognized as revenue until (a) it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur, or (b) the uncertainty associated with the variable consideration is subsequently resolved. Incentive Fees are typically recognized as revenue when realized at the end of the measurement period. Once realized, such fees are not subject to clawback or reversal. Accrued but unpaid Incentive Fees charged directly to investors in Blackstone Funds as of the reporting date are recorded within Due from Affiliates in the Condensed Consolidated Statements of Financial Condition.

Table of Contents

Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

Investment Income (Loss) — Investment Income (Loss) represents the unrealized and realized gains and losses on Blackstone’s Performance Allocations and Principal Investments.

In carry fund structures, Blackstone, through its subsidiaries, invests alongside its limited partners in a partnership and is entitled to its 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, Blackstone is entitled to a disproportionate allocation of the income otherwise allocable to the limited partners, commonly referred to as carried interest (“Performance Allocations”).

Performance Allocations are made to the general partner based on cumulative fund performance to date, subject to a preferred return to limited partners. At the end of each reporting period, Blackstone calculates the balance of accrued Performance Allocations (“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. As the fair value of underlying investments varies between reporting periods, it is necessary to make adjustments to amounts recorded as Accrued Performance Allocations to reflect either (a) positive performance resulting in an increase in the Accrued Performance Allocation to the general partner or (b) negative performance that would cause the amount due to Blackstone to be less than the amount previously recognized as revenue, resulting in a negative adjustment to the Accrued Performance Allocation to the general partner. In each scenario, it is necessary to calculate the Accrued Performance Allocation on cumulative results compared to the Accrued Performance Allocation recorded to date and make the required positive or negative adjustments. Blackstone ceases to record negative Performance Allocations once previously Accrued Performance Allocations for such fund have been fully reversed. Blackstone is not obligated to pay guaranteed returns or hurdles, and therefore, cannot have negative Performance Allocations over the life of a fund. Accrued Performance Allocations as of the reporting date are reflected in Investments in the Condensed Consolidated Statements of Financial Condition.

Performance Allocations are realized when an underlying investment is profitably disposed of and the fund’s cumulative returns are in excess of the preferred return or, in limited instances, after certain thresholds for return of capital are met. 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. As such, the accrual for potential repayment of previously received Performance Allocations, which is a component of Due to Affiliates, represents all amounts previously distributed to Blackstone Holdings and non-controlling interest holders that would need to be repaid to the Blackstone carry funds if the Blackstone carry funds were to be liquidated based on the current fair value of the underlying funds’ investments as of the reporting date. The actual clawback liability, however, generally does not become realized until the end of a fund’s life except for certain funds, including certain Blackstone real estate funds, multi-asset class investment funds and credit-focused funds, which may have an interim clawback liability.

Principal Investments include the unrealized and realized gains and losses on Blackstone’s principal investments, including its investments in Blackstone Funds that are not consolidated and receive pro-rata allocations, its equity method investments, and other principal investments. Income (Loss) on Principal Investments is realized when Blackstone redeems all or a portion of its investment or when Blackstone receives cash income, such as dividends or distributions. Unrealized Income (Loss) on Principal Investments results from changes in the fair value of the underlying investment as well as the reversal of unrealized gain (loss) at the time an investment is realized.

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

Interest and Dividend Revenue — Interest and Dividend Revenue comprises primarily of interest and dividend income earned on principal investments not accounted for under the equity method held by Blackstone.

Other Revenue — Other Revenue consists of miscellaneous income and foreign exchange gains and losses arising on transactions denominated in currencies other than U.S. dollars.

Fair Value of Financial Instruments

GAAP establishes a hierarchical disclosure framework which prioritizes and ranks the level of market price observability used in measuring financial instruments at fair value. Market price observability is affected by a number of factors, including the type of financial instrument, the characteristics specific to the financial instrument and the state of the marketplace, including the existence and transparency of transactions between market participants. Financial instruments with readily available quoted prices in active markets generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.

Financial instruments measured and reported at fair value are classified and disclosed based on the observability of inputs used in the determination of fair values, as follows:

●	Level I – Quoted prices are available in active markets for identical financial instruments as of the reporting date. The types of financial instruments in Level I include listed equities, listed derivatives and mutual funds with quoted prices. Blackstone does not adjust the quoted price for these investments, even in situations where Blackstone holds a large position and a sale could reasonably impact the quoted price.
●	Level II – Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the reporting date, and fair value is determined through the use of models or other valuation methodologies. Financial instruments which are generally included in this category include corporate bonds and loans, including corporate bonds and loans held within CLO vehicles, government and agency securities, less liquid and restricted equity securities, and certain <br>over-the-counter<br> derivatives where the fair value is based on observable inputs.
---	---
●	Level III – Pricing inputs are unobservable for the financial instruments and includes situations where there is little, if any, market activity for the financial instrument. The inputs into the determination of fair value require significant management judgment or estimation. Financial instruments that are included in this category generally include general and limited partnership interests in private equity and real estate funds, credit-focused funds, distressed debt and <br>non-investment<br> grade residual interests in securitizations, certain corporate bonds and loans held within CLO vehicles and certain <br>over-the-counter<br> derivatives where the fair value is based on unobservable inputs.
---	---

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair value hierarchy is appropriate for any given financial instrument is based on the lowest level of input that is significant to the fair value measurement. Blackstone’s assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the financial instrument.

Level II Valuation Techniques

Financial instruments classified within Level II of the fair value hierarchy comprise of debt instruments, including debt securities sold, not yet purchased and certain equity securities and derivative instruments valued using observable inputs.

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Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

The valuation techniques used to value financial instruments classified within Level II of the fair value hierarchy are as follows:

●	Debt Instruments 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. The valuation of certain equity securities is based on an observable price for an identical security adjusted for the effect of a restriction.
●	Freestanding Derivatives are valued using contractual cash flows and observable inputs comprising yield curves, foreign currency rates and credit spreads.
---	---

●

Debt Instruments 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. The valuation of certain equity securities is based on an observable price for an identical security adjusted for the effect of a restriction.

●

Freestanding Derivatives are valued using contractual cash flows and observable inputs comprising yield curves, foreign currency rates and credit spreads.

---

Level III Valuation Techniques

In the absence of observable market prices, Blackstone values its investments using valuation methodologies applied on a consistent basis. For some investments little market activity may exist; management’s determination of fair value is then based on the best information available in the circumstances, and may incorporate management’s own assumptions and involves a significant degree of judgment, taking into consideration a combination of internal and external factors, including the appropriate risk adjustments for non-performance and liquidity risks. Investments for which market prices are not observable include private investments in the equity of operating companies, real estate properties, certain funds of hedge funds and credit-focused investments.

Real Estate Investments – The fair values of real estate investments are determined by considering projected operating cash flows, sales of comparable assets, if any, and replacement costs, among other measures. The methods used to estimate the fair value of real estate investments include the discounted cash flow method and/or capitalization rates analysis. Valuations may be derived by reference to observable valuation measures for comparable companies or assets (for example, multiplying a key performance metric of the investee company or asset, such as earnings before interest, taxes, depreciation and amortization (“EBITDA”), by a relevant valuation multiple observed in the range of comparable companies or transactions), adjusted by management for differences between the investment and the referenced comparables, and in some instances by reference to option pricing models or other similar methods. Where a discounted cash flow method is used, a terminal value is derived by reference to an exit EBITDA multiple or capitalization rate. Additionally, where applicable, projected distributable cash flow-through debt maturity will be considered in support of the investment’s fair value.

Private Equity Investments – The fair values of private equity investments are determined by reference to projected net earnings, EBITDA, the discounted cash flow method, public market or private transactions, valuations for comparable companies and other measures which, in many cases, are based on unaudited information at the time received. Valuations may be derived by reference to observable valuation measures for comparable companies or transactions (for example, multiplying a key performance metric of the investee company, such as EBITDA, by a relevant valuation multiple observed in the range of comparable companies or transactions), adjusted by management for differences between the investment and the referenced comparables, and in some instances by reference to option pricing models or other similar methods. Where a discounted cash flow method is used, a terminal value is derived by reference to EBITDA or price/earnings exit multiples.

Credit-Focused Investments – The fair values of credit-focused investments are generally determined on the basis of prices between market participants provided by reputable dealers or pricing services. For credit-focused investments that are not publicly traded or whose market prices are not readily available, Blackstone may utilize other valuation techniques, including the discounted cash flow method or a market approach. The discounted cash flow method projects the expected cash flows of the debt instrument based on contractual terms, and discounts such cash flows back to the valuation date using a market-based yield. The market-based yield is estimated using yields of publicly traded debt instruments issued by companies operating in similar industries as the subject investment, with similar leverage statistics and time to maturity.

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

The market approach is generally used to determine the enterprise value of the issuer of a credit investment, and considers valuation multiples of comparable companies or transactions. The resulting enterprise value will dictate whether or not such credit investment has adequate enterprise value coverage. In cases of distressed credit instruments, the market approach may be used to estimate a recovery value in the event of a restructuring.

Investments, at Fair Value

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. Such consolidated funds’ investments are reflected in Investments on the Condensed Consolidated Statements of Financial Condition at fair value, with unrealized gains and losses resulting from changes in fair value reflected as a component of Net Gains from Fund Investment Activities in the Condensed Consolidated Statements of Operations. Fair value is the amount that would be received to sell an asset or paid to transfer a liability, in an orderly transaction between market participants at the measurement date, at current market conditions (i.e., the exit price).

Blackstone’s principal investments are presented at fair value with unrealized appreciation or depreciation and realized gains and losses recognized in the Condensed Consolidated Statements of Operations within Investment Income (Loss).

For certain instruments, Blackstone has elected the fair value option. Such election is irrevocable and is applied on an investment by investment basis at initial recognition or other eligible election dates. Blackstone has applied the fair value option for certain loans and receivables, unfunded loan commitments and certain investments in private debt securities that otherwise would not have been carried at fair value with gains and losses recorded in net income. The methodology for measuring the fair value of such investments is consistent with the methodology applied to private equity, real estate, credit-focused and funds of hedge funds investments. Changes in the fair value of such instruments are recognized in Investment Income (Loss) in the Condensed Consolidated Statements of Operations. Interest income on interest bearing loans and receivables and debt securities on which the fair value option has been elected is based on stated coupon rates adjusted for the accretion of purchase discounts and the amortization of purchase premiums. This interest income is recorded within Interest and Dividend Revenue.

Blackstone has elected the fair value option for certain proprietary investments that would otherwise have been accounted for using the equity method of accounting. The fair value of such investments is based on quoted prices in an active market or using the discounted cash flow method. Changes in fair value are recognized in Investment Income (Loss) in the Condensed Consolidated Statements of Operations.

Further disclosure on instruments for which the fair value option has been elected is presented in Note 7. “Fair Value Option.”

The investments of consolidated Blackstone Funds in funds of hedge funds (“Investee Funds”) are valued at net asset value (“NAV”) per share of the Investee Fund. In limited circumstances, Blackstone may determine, based on its own due diligence and investment procedures, that NAV per share does not represent fair value. In such circumstances, Blackstone will estimate the fair value in good faith and in a manner that it reasonably chooses, in accordance with the requirements of GAAP.

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

Certain investments of Blackstone and of the consolidated Blackstone funds of hedge funds and credit-focused funds measure their investments in underlying funds at fair value using NAV per share without adjustment. The terms of the investee’s investment generally provide for minimum holding periods or lock-ups, the institution of gates on redemptions or the suspension of redemptions or an ability to side-pocket investments, at the discretion of the investee’s fund manager, and as a result, investments may not be redeemable at, or within three months of, the reporting date. A side-pocket is used by hedge funds and funds of hedge funds to separate investments that may lack a readily ascertainable value, are illiquid or are subject to liquidity restriction. Redemptions are generally not permitted until the investments within a side-pocket are liquidated or it is deemed that the conditions existing at the time that required the investment to be included in the side-pocket no longer exist. As the timing of either of these events is uncertain, the timing at which Blackstone may redeem an investment held in a side-pocket cannot be estimated. Further disclosure on instruments for which fair value is measured using NAV per share is presented in Note 5. “Net Asset Value as Fair Value.”

Security and loan transactions are recorded on a trade date basis.

Blackstone may elect to measure certain proprietary investments in equity securities without readily determinable fair values under the measurement alternative, which reflects cost less impairment, with adjustments in value resulting from observable price changes arising from orderly transactions of the same or a similar security from the same issuer. If the measurement alternative election is not made, the equity security is measured at fair value. The measurement alternative election is made on an instrument by instrument basis.

Equity Method Investments

Investments in which Blackstone is deemed to exert significant influence, but not control, are accounted for using the equity method of accounting except in cases where the fair value option has been elected. Blackstone has significant influence over all Blackstone Funds in which it invests but does not consolidate. Therefore, its investments in such Blackstone Funds, which include both a proportionate and disproportionate allocation of the profits and losses (as is the case with carry funds that include a Performance Allocation), are accounted for under the equity method. Under the equity method of accounting, Blackstone’s share of earnings (losses) from equity method investments is included in Investment Income (Loss) in the Condensed Consolidated Statements of Operations.

In cases where Blackstone’s equity method investments provide for a disproportionate allocation of the profits and losses (as is the case with carry funds that include a Performance Allocation), 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. As the fair value of underlying investments varies between reporting periods, it is necessary to make adjustments to amounts recorded as Accrued Performance Allocations to reflect either (a) positive performance resulting in an increase in the Accrued Performance Allocation to the general partner, or (b) negative performance that would cause the amount due to Blackstone to be less than the amount previously recognized as revenue, resulting in a negative adjustment to the Accrued Performance Allocation to the general partner. In each scenario, it is necessary to calculate the Accrued Performance Allocation on cumulative results compared to the Accrued Performance Allocation recorded to date and make the required positive or negative adjustments. Blackstone ceases to record negative Performance Allocations once previously Accrued Performance Allocations for such fund have been fully reversed. Blackstone is not obligated to pay guaranteed returns or hurdles, and therefore, cannot have negative Performance Allocations over the life of a fund. The carrying amounts of equity method investments are reflected in Investments in the Condensed Consolidated Statements of Financial Condition.

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

Strategic Partners’ results presented in Blackstone’s financial statements are reported on a three month lag from Strategic Partners’ fund financial statements, which report the performance of underlying investments generally on a same quarter basis, if available. Therefore, Strategic Partners’ results presented herein do not reflect the impact of economic and market activity in the current quarter. Current quarter market activity of Strategic Partners’ underlying investments is expected to affect Blackstone’s reported results in upcoming periods. Effective September 30, 2021, Strategic Partners’ fund financial reporting process was updated to report the performance of underlying fund investments generally on a same-quarter basis, if available. Previously, such fund financial reporting in Strategic Partners’ fund financial statements generally reported on a three month lag. This update to Strategic Partners’ fund financial reporting process has permitted Strategic Partners’ appreciation to be reported in Blackstone’s financial statements on a more current basis.

Compensation and Benefits

Compensation and Benefits — Compensation — Compensation consists of (a) salary and bonus, and benefits paid and payable to employees and senior managing directors and (b) equity-based compensation associated with the grants of equity-based awards to employees and senior managing directors. Compensation cost relating to the issuance of equity-based awards to senior managing directors and employees is measured at fair value at the grant date, and expensed over the vesting period on a straight-line basis, taking into consideration expected forfeitures, except in the case of (a) equity-based awards that do not require future service, which are expensed immediately, and (b) certain awards to recipients that meet criteria making them eligible for retirement (allowing such recipient to keep a percentage of those awards upon departure from Blackstone after becoming eligible for retirement), for which the expense for the portion of the award that would be retained in the event of retirement is either expensed immediately or amortized to the retirement date. Cash settled equity-based awards and awards settled in a variable number of shares are classified as liabilities and are remeasured at the end of each reporting period.

Compensation and Benefits

— Incentive Fee Compensation

— Incentive Fee Compensation consists of compensation paid based on Incentive Fees.

Compensation and Benefits

— Performance Allocations Compensation

— Performance Allocation Compensation consists of compensation paid based on Performance Allocations (which may be distributed in cash or in-kind). Such compensation expense is subject to both positive and negative adjustments. Unlike Performance Allocations, compensation expense is based on the performance of individual investments held by a fund rather than on a fund by fund basis. These amounts may also include allocations of investment income from Blackstone’s principal investments, to senior managing directors and employees participating in certain profit sharing initiatives.

Non-Controlling Interests in Consolidated Entities

Non-Controlling Interests in Consolidated Entities represent the component of Equity in general partner entities and consolidated Blackstone Funds held by third party investors and employees. The percentage interests in consolidated Blackstone Funds held by third parties and employees is adjusted for general partner allocations and by subscriptions and redemptions in funds of hedge funds and certain credit-focused funds which occur during the reporting period. Income (Loss) and other comprehensive income, if applicable, arising from the respective entities is allocated to non-controlling interests in consolidated entities based on the relative ownership interests of third party investors and employees after considering any contractual arrangements that govern the allocation of income (loss) such as fees allocable to Blackstone Inc.

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

Redeemable Non-Controlling Interests in Consolidated Entities

Investors in certain consolidated funds may be granted redemption rights that allow for quarterly or monthly redemption, as outlined in the relevant fund governing documents. Such redemption rights may include limitations on the amounts that may be redeemed in a given period, may only allow for redemption following the expiration of a specified period of time, or may be withdrawn subject to a redemption fee during the period when capital may not be withdrawn. As a result, amounts relating to third party interests in such consolidated funds are presented as Redeemable Non-Controlling Interests in Consolidated Entities within the Condensed Consolidated Statements of Financial Condition. When redeemable amounts become legally payable to investors, they are classified as a liability and included in Accounts Payable, Accrued Expenses and Other Liabilities in the Condensed Consolidated Statements of Financial Condition. For all consolidated funds in which redemption rights have not been granted, non-controlling interests are presented within Equity in the Condensed Consolidated Statements of Financial Condition as Non-Controlling Interests in Consolidated Entities.

Non-Controlling Interests in Blackstone Holdings

Non-Controlling Interests in Blackstone Holdings represent the component of Equity in the consolidated Blackstone Holdings Partnerships held by Blackstone personnel and others who are limited partners of the Blackstone Holdings Partnerships.

Certain costs and expenses are borne directly by the Holdings Partnerships. Income (Loss), excluding those costs directly borne by and attributable to the Holdings Partnerships, is attributable to Non-Controlling Interests in Blackstone Holdings. This residual attribution is based on the year to date average percentage of Blackstone Holdings Partnership Units and unvested participating Holdings Partnership Units held by Blackstone personnel and others who are limited partners of the Blackstone Holdings Partnerships. Unvested participating Holdings Partnership Units are excluded from the attribution in periods of loss as they are not contractually obligated to share in losses of the Holdings Partnerships.

Income Taxes

Provision of Income Taxes

Income taxes are provided for using the asset and liability method under which deferred tax assets and liabilities are recognized for temporary differences between the financial reporting and tax bases of assets and liabilities, resulting in all pretax amounts being appropriately tax effected in the period, irrespective of which tax return year items will be reflected. Blackstone reports interest expense and tax penalties related to income tax matters in provision for income taxes.

Deferred Income Taxes

Deferred income taxes reflect the net tax effects of temporary differences between the financial reporting and tax bases of assets and liabilities. These temporary differences result in taxable or deductible amounts in future years and are measured using the tax rates and laws that will be in effect when such differences are expected to reverse. Valuation allowances are established to reduce the deferred tax assets to the amount that is more likely than not to be realized. Deferred tax assets are separately stated, and deferred tax liabilities are included in Accounts Payable, Accrued Expenses, and Other Liabilities in the financial statements.

Unrecognized Tax Benefits

Blackstone recognizes tax positions in the condensed consolidated financial statements when it is more likely than not that the position will be sustained on examination by the relevant taxing authority based on the technical merits of the position. A position that meets this standard is measured at the largest amount of benefit what will more likely than not be realized on settlement. A liability is established for differences between positions taken in the return and amounts recognized in the condensed consolidated financial statements.

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

Net Income (Loss) Per Share of Common Stock

Basic Income (Loss) Per Share of Common Stock is calculated by dividing Net Income (Loss) Attributable to Blackstone Inc. by the weighted-average shares of common stock, unvested participating shares of common stock outstanding for the period and vested deferred restricted shares of common stock that have been earned for which issuance of the related shares of common stock is deferred until future periods. Diluted Income (Loss) Per Share of Common Stock reflects the impact of all dilutive securities. Unvested participating shares of common stock are excluded from the computation in periods of loss as they are not contractually obligated to share in losses.

Blackstone applies the treasury stock method to determine the dilutive weighted-average common shares outstanding for certain equity-based compensation awards. Blackstone applies the “if-converted” method to the Blackstone Holdings Partnership Units to determine the dilutive impact, if any, of the exchange right included in the Blackstone Holdings Partnership Units. Blackstone applies the contingently issuable share model to contracts that may require the issuance of shares.

Reverse Repurchase and Repurchase Agreements

Securities purchased under agreements to resell (“reverse repurchase agreements”) and securities sold under agreements to repurchase (“repurchase agreements”), comprised primarily of U.S. and non-U.S. government and agency securities, asset-backed securities and corporate debt, represent collateralized financing transactions. Such transactions are recorded in the Condensed Consolidated Statements of Financial Condition at their contractual amounts and include accrued interest. The carrying value of reverse repurchase and repurchase agreements approximates fair value.

Blackstone manages credit exposure arising from reverse repurchase agreements and repurchase agreements by, in appropriate circumstances, entering into master netting agreements and collateral arrangements with counterparties that provide Blackstone, in the event of a counterparty default, the right to liquidate collateral and the right to offset a counterparty’s rights and obligations.

Blackstone takes possession of securities purchased under reverse repurchase agreements and is permitted to repledge, deliver or otherwise use such securities. Blackstone also pledges its financial instruments to counterparties to collateralize repurchase agreements. Financial instruments pledged that can be repledged, delivered or otherwise used by the counterparty are recorded in Investments in the Condensed Consolidated Statements of Financial Condition. Additional disclosures relating to repurchase agreements are discussed in Note 10. “Repurchase Agreements.”

Blackstone does not offset assets and liabilities relating to reverse repurchase agreements and repurchase agreements in its Condensed Consolidated Statements of Financial Condition. Additional disclosures relating to offsetting are discussed in Note 11. “Offsetting of Assets and Liabilities.”

Securities Sold, Not Yet Purchased

Securities Sold, Not Yet Purchased consist of equity and debt securities that Blackstone has borrowed and sold. Blackstone is required to “cover” its short sale in the future by purchasing the security at prevailing market prices and delivering it to the counterparty from which it borrowed the security. Blackstone is exposed to loss in the event that the price at which a security may have to be purchased to cover a short sale exceeds the price at which the borrowed security was sold short.

Securities Sold, Not Yet Purchased are recorded at fair value in the Condensed Consolidated Statements of Financial Condition.

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

Derivative Instruments

Blackstone recognizes all derivatives as assets or liabilities on its Condensed Consolidated Statements of Financial Condition at fair value. On the date Blackstone enters into a derivative contract, it designates and documents each derivative contract as one of the following: (a) a hedge of a recognized asset or liability (“fair value hedge”), (b) a hedge of a forecasted transaction or of the variability of cash flows to be received or paid related to a recognized asset or liability (“cash flow hedge”), (c) a hedge of a net investment in a foreign operation, or (d) a derivative instrument not designated as a hedging instrument (“freestanding derivative”).

For freestanding derivative contracts, Blackstone presents changes in fair value in current period earnings. Changes in the fair value of derivative instruments held by consolidated Blackstone Funds are reflected in Net Gains from Fund Investment Activities or, where derivative instruments are held by Blackstone, within Investment Income (Loss) in the Condensed Consolidated Statements of Operations. The fair value of freestanding derivative assets of the consolidated Blackstone Funds are recorded within Investments, the fair value of freestanding derivative assets that are not part of the consolidated Blackstone Funds are recorded within Other Assets and the fair value of freestanding derivative liabilities are recorded within Accounts Payable, Accrued Expenses and Other Liabilities in the Condensed Consolidated Statements of Financial Condition.

Blackstone has elected to not offset derivative assets and liabilities or financial assets in its Condensed Consolidated Statements of Financial Condition, including cash, that may be received or paid as part of collateral arrangements, even when an enforceable master netting agreement is in place that provides Blackstone, in the event of counterparty default, the right to liquidate collateral and the right to offset a counterparty’s rights and obligations.

Blackstone’s other disclosures regarding derivative financial instruments are discussed in Note 6. “Derivative Financial Instruments.”

Blackstone’s disclosures regarding offsetting are discussed in Note 11. “Offsetting of Assets and Liabilities.”

Affiliates

Blackstone considers its Founder, senior managing directors, employees, the Blackstone Funds and the Portfolio Companies to be affiliates.

Dividends

Dividends are reflected in the condensed consolidated financial statements when declared.

3. Intangible Assets

Intangible Assets, Net consists of the following:

	June 30,			December 31,
	2022			2021
Finite-Lived Intangible Assets/Contractual Rights	$	1,745,376		$	1,745,376
Accumulated Amortization		(1,498,388	)		(1,460,992	)
Intangible Assets, Net	$	246,988		$	284,384

Amortization expense associated with Blackstone’s intangible assets was $18.7 million and $37.4 million for the three and six month periods ended June 30, 2022, respectively, and $18.7 million and $37.5 million for the three and six month periods ended June 30, 2021, respectively.

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

Amortization

of Intangible Assets held at June 30, 2022 is expected to be $67.1 million, $38.1 million, $30.5 million, $30.5 million, and $30.4 million for each of the years ending December 31, 2022, 2023, 2024, 2025 and 2026, respectively. Blackstone’s Intangible Assets as of June 30, 2022 are expected to amortize over a weighted-average period of 7.2 years.

4. Investments

Investments consist of the

following:

	June 30,		December 31,
	2022		2021
Investments of Consolidated Blackstone Funds	$	3,764,850	$	2,018,829
Equity Method Investments
Partnership Investments		5,446,688		5,635,212
Accrued Performance Allocations		13,544,855		17,096,873
Corporate Treasury Investments		810,672		658,066
Other Investments		3,756,693		3,256,063
	$	27,323,758	$	28,665,043

Blackstone’s share of Investments of Consolidated Blackstone Funds totaled $377.0 million and $375.8 million at June 30, 2022 and December 31, 2021, respectively.

Where appropriate, the accounting for Blackstone’s investments incorporates the changes in fair value of those investments as determined under GAAP. The significant inputs and assumptions required to determine the change in fair value of the investments of Consolidated Blackstone Funds, Corporate Treasury Investments and Other Investments are discussed in more detail in Note 8. “Fair Value Measurements of Financial Instruments.”

Investments of Consolidated Blackstone Funds

The following table presents the Realized and Net Change in Unrealized Gains (Losses) on investments held by the consolidated Blackstone Funds and a reconciliation to Other Income (Loss) – Net Gains (Losses) from Fund Investment Activities in the Condensed Consolidated Statements of Operations:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2022			2021		2022			2021
Realized Gains	$	94,181		$	33,001	$	111,869		$	61,995
Net Change in Unrealized Gains (Losses)		(213,436	)		88,489		(185,595	)		172,956
Realized and Net Change in Unrealized Gains (Losses) from Consolidated Blackstone Funds		(119,255	)		121,490		(73,726	)		234,951
Interest and Dividend Revenue and Foreign Exchange Gains Attributable to Consolidated Blackstone Funds		14,929			5,626		20,276			12,518
Other Income (Loss) – Net Gains (Losses) from Fund Investment Activities	$	(104,326	)	$	127,116	$	(53,450	)	$	247,469

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

Equity Method Investments

Blackstone’s equity method investments include Partnership Investments, which represent the pro-rata investments, and any associated Accrued Performance Allocations, in Blackstone Funds, excluding any equity method investments for which the fair value option has been elected. Blackstone evaluates each of its equity method investments, excluding Accrued Performance Allocations, to determine if any were significant as defined by guidance from the United States Securities and Exchange Commission. As of and for the six months ended June 30, 2022 and 2021, no individual equity method investment held by Blackstone met the significance criteria. As such, Blackstone is not required to present separate financial statements for any of its equity method investments.

Partnership Investments

Blackstone recognized net gains (losses) related to its Partnership Investments accounted for under the equity method of $(138.7) million and $423.3 million for the three months ended June 30, 2022 and 2021, respectively. Blackstone recognized net gains related to its equity method investments of $197.6 million and $1.1 billion for the six months ended June 30, 2022 and 2021, respectively.

Accrued Performance Allocations

Accrued Performance Allocations to Blackstone were as follows:

	Real			Private			Hedge Fund			Credit &
	Estate			Equity			Solutions			Insurance			Total
Accrued Performance Allocations, December 31, 2021	$	8,471,754		$	7,550,468		$	456,405		$	618,246		$	17,096,873
Performance Allocations as a Result of Changes in Fund Fair Values		2,440,870			(353,970	)		56,264			5,454			2,148,618
Foreign Exchange Loss		(97,153	)		—			—			—			(97,153	)
Impact of Consolidation		(10,393	)		—			—			—			(10,393	)
Fund Distributions		(4,591,348	)		(815,886	)		(58,754	)		(127,102	)		(5,593,090	)
Accrued Performance Allocations, <br>June 30, 2022	$	6,213,730		$	6,380,612		$	453,915		$	496,598		$	13,544,855

Corporate Treasury Investments

The portion of corporate treasury investments included in Investments represents Blackstone’s investments into primarily fixed income securities, mutual fund interests, and other fund interests. These strategies are managed by a combination of Blackstone personnel and third party advisors. The following table presents the Realized and Net Change in Unrealized Gains (Losses) on these investments:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2022			2021			2022			2021
Realized Gains (Losses)	$	(18,655	)	$	(1,049	)	$	(20,617	)	$	5,885
Net Change in Unrealized Gains (Losses)		(19,980	)		29,523			(47,583	)		39,452
	$	(38,635	)	$	28,474		$	(68,200	)	$	45,337

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

Other Investments

Other Investments consist of equity method investments where Blackstone has elected the fair value option and other proprietary investment securities held by Blackstone, including equity securities carried at fair value, equity investments without readily determinable fair values, and subordinated notes in non-consolidated CLO vehicles. Equity investments without a readily determinable fair value had a carrying value of $2.5 billion as of June 30, 2022, including the investment in Corebridge Financial, Inc., formerly known as American International Group, Inc.’s Life and Retirement business (“Corebridge”). In the period of acquisition and upon remeasurement in connection with an observable transaction, such investments are reported at fair value. See Note 8. “Fair Value Measurements of Financial Instruments” for additional detail. The following table presents Blackstone’s Realized and Net Change in Unrealized Gains (Losses) in Other Investments:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2022			2021		2022			2021
Realized Gains	$	15,992		$	29,309	$	117,341		$	29,422
Net Change in Unrealized Gains (Losses)		(70,785	)		1,065		(151,270	)		285,567
	$	(54,793	)	$	30,374	$	(33,929	)	$	314,989

5. Net Asset Value as Fair Value

A summary of fair value by strategy type and ability to redeem such investments as of June 30, 2022 is presented below:

			Redemption
			Frequency		Redemption
Strategy (a)	Fair Value		(if currently eligible)		Notice Period
Equity	$	433,281		(b)		(b)
Real Estate		118,606		(c)		(c)
Credit Driven		25,778		(d)		(d)
Commodities		1,119		(e)		(e)
Diversified Instruments		17		(f)		(f)
	$	578,801
(a)	As of June 30, 2022, Blackstone had no unfunded commitments.
---	---
(b)	The Equity category includes investments in hedge funds that invest primarily in domestic and international equity securities. Investment representing 100% of the fair value of the investments in this category may not be redeemed at, or within three months of, the reporting date. Investments representing less than 1% of the fair value of the investments in this category are in liquidation. As of the reporting date, the investee fund manager had elected to side-pocket less than 1% of Blackstone’s investments in the category.
---	---
(c)	The Real Estate category includes<br><br>investments in funds that primarily invest in real <br>estate<br>assets. Investments representing 100% of fair value of the investments in this category are redeemable as of the reporting date.
---	---
(d)	The Credit Driven category includes investments in hedge funds that invest primarily in domestic and international bonds. Investments representing 83% of the fair value of the investments in this category are in liquidation. The remaining 17% of investments in this category may not be redeemed at, or within three months of, the reporting date.
---	---

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Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

(e)	The Commodities category includes investments in commodities-focused funds that primarily invest in futures and physical-based commodity driven strategies. Investments representing 100% of the fair value of the investments in this category may not be redeemed at, or within three months of, the reporting date.
(f)	Diversified Instruments include investments in funds that invest across multiple strategies. Investments representing 100% of the fair value of the investments in this category may not be redeemed at, or within three months of, the reporting date.
---	---

6. Derivative Financial Instruments

Blackstone and the consolidated Blackstone Funds enter into derivative contracts in the normal course of business to achieve certain risk management objectives and for general investment purposes. Blackstone may enter into derivative contracts in order to hedge its interest rate risk exposure against the effects of interest rate changes. Additionally, Blackstone may also enter into derivative contracts in order to hedge its foreign currency risk exposure against the effects of a portion of its non-U.S. dollar denominated currency net investments. As a result of the use of derivative contracts, Blackstone and the consolidated Blackstone Funds are exposed to the risk that counterparties will fail to fulfill their contractual obligations. To mitigate such counterparty risk, Blackstone and the consolidated Blackstone Funds enter into contracts with certain major financial institutions, all of which have investment grade ratings. Counterparty credit risk is evaluated in determining the fair value of derivative instruments.

Freestanding Derivatives

Freestanding derivatives are instruments that Blackstone and certain of the consolidated Blackstone Funds have entered into as part of their overall risk management and investment strategies. These derivative contracts are not designated as hedging instruments for accounting purposes. Such contracts may include interest rate swaps, foreign exchange contracts, equity swaps, options, futures and other derivative contracts.

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

The table below summarizes the aggregate notional amount and fair value of the derivative financial instruments. The notional amount represents the absolute value amount of all outstanding derivative contracts.

	June 30, 2022								December 31, 2021
	Assets				Liabilities				Assets				Liabilities
			Fair				Fair				Fair				Fair
	Notional		Value		Notional		Value		Notional		Value		Notional		Value
Freestanding Derivatives
Blackstone
Interest Rate Contracts	$	690,840	$	139,430	$	614,600	$	42,341	$	609,132	$	143,349	$	692,442	$	138,677
Foreign Currency Contracts		891,070		12,874		1,008,220		14,653		217,161		1,858		572,643		6,143
Credit Default Swaps		2,007		349		9,463		1,433		2,007		194		9,916		1,055
		1,583,917		152,653		1,632,283		58,427		828,300		145,401		1,275,001		145,875
Investments of Consolidated Blackstone Funds
Foreign Currency Contracts		132,289		2,405		506		2		20,764		339		54,300		370
Interest Rate Contracts		596,327		26,577		—		—		—		—		14,000		764
Credit Default Swaps		3,401		585		6,814		1,173		3,401		321		22,865		799
		732,017		29,567		7,320		1,175		24,165		660		91,165		1,933
	$	2,315,934	$	182,220	$	1,639,603	$	59,602	$	852,465	$	146,061	$	1,366,166	$	147,808

The table below summarizes the impact to the Condensed Consolidated Statements of Operations from derivative financial instruments:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2022			2021			2022			2021
Freestanding Derivatives
Realized Gains (Losses)
Interest Rate Contracts	$	1,379		$	(348	)	$	5,278		$	1,298
Foreign Currency Contracts		(8,767	)		2,887			(4,775	)		4,423
Credit Default Swaps		33			(8	)		128			(990	)
Total Return Swaps		—			(65	)		—			(1,415	)
Other		—			—			—			(40	)
		(7,355	)		2,466			631			3,276
Net Change in Unrealized Gains (Losses)
Interest Rate Contracts		72,721			39,484			107,677			45,185
Foreign Currency Contracts		6,766			(3,249	)		(2,606	)		(3,376	)
Credit Default Swaps		(433	)		—			(420	)		842
Total Return Swaps		—			—			—			2,130
Other		—			—			—			(20	)
		79,054			36,235			104,651			44,761
	$	71,699		$	38,701		$	105,282		$	48,037

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

As of June 30, 2022 and December 31, 2021, Blackstone had not designated any derivatives as fair value, cash flow or net investment hedges.

7. Fair Value Option

The following table summarizes the financial instruments for which the fair value option has been elected:

	June 30,		December 31,
	2022		2021
Assets
Loans and Receivables	$	534,105	$	392,732
Equity and Preferred Securities		1,236,517		516,539
Debt Securities		155,105		183,877
	$	1,925,727	$	1,093,148
Liabilities
Corporate Treasury Commitments	$	8,697	$	636

The following tables present the Realized and Net Change in Unrealized Gains (Losses) on financial instruments on which the fair value option was elected:

	Three Months Ended June 30,
	2022						2021
				Net Change						Net Change
	Realized			in Unrealized			Realized			in Unrealized
	Gains (Losses)			Gains (Losses)			Gains (Losses)			Gains
Assets
Loans and Receivables	$	(1,964	)	$	(6,805	)	$	(3,065	)	$	7,012
Equity and Preferred Securities		13,023			(19,774	)		18,444			9,530
Debt Securities		(3,415	)		(19,227	)		1,303			1,923
	$	7,644		$	(45,806	)	$	16,682		$	18,465
Liabilities
Corporate Treasury Commitments	$	—		$	(6,868	)	$	—		$	7

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

	Six Months Ended June 30,
	2022						2021
				Net Change						Net Change
	Realized			in Unrealized			Realized			in Unrealized
	Gains (Losses)			Gains (Losses)			Gains (Losses)			Gains (Losses)
Assets
Loans and Receivables	$	(3,417	)	$	(5,359	)	$	(7,896	)	$	5,083
Equity and Preferred Securities		12,301			(12,938	)		18,444			40,401
Debt Securities		(4,367	)		(28,209	)		9,970			(4,235	)
	$	4,517		$	(46,506	)	$	20,518		$	41,249
Liabilities
Corporate Treasury Commitments	$	—		$	(8,061	)	$	—		$	(193	)

The following table presents information for those financial instruments for which the fair value option was elected:

	June 30, 2022							December 31, 2021
				For Financial Assets							For Financial Assets
				Past Due							Past Due
	(Deficiency)					Excess		(Deficiency)					Excess
	of Fair Value			Fair		of Fair Value		of Fair Value			Fair		of Fair Value
	Over Principal			Value		Over Principal		Over Principal			Value		Over Principal
Loans and Receivables	$	(8,906	)	$	—	$	—	$	(2,748	)	$	—	$	—
Debt Securities		(58,938	)		—		—		(29,475	)		—		—
	$	(67,844	)	$	—	$	—	$	(32,223	)	$	—	$	—

As of June 30, 2022 and December 31, 2021, no Loans and Receivables for which the fair value option was elected were past due or in non-accrual status.

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

8. Fair Value Measurements of Financial Instruments

The following tables summarize the valuation of Blackstone’s financial assets and liabilities by the fair value hierarchy:

	June 30, 2022
	Level I		Level II		Level III		NAV		Total
Assets
Cash and Cash Equivalents	$	1,425,552	$	—	$	—	$	—	$	1,425,552
Investments
Investments of Consolidated Blackstone Funds
Equity Securities, Partnerships and LLC Interests (a)		42,980		122,867		2,724,955		573,284		3,464,086
Debt Instruments		452		203,888		66,857		—		271,197
Freestanding Derivatives		—		29,567		—		—		29,567
Total Investments of Consolidated Blackstone Funds		43,432		356,322		2,791,812		573,284		3,764,850
Corporate Treasury Investments		296,608		508,042		6,022		—		810,672
Other Investments		313,295		927,460		53,649		5,517		1,299,921
Total Investments		653,335		1,791,824		2,851,483		578,801		5,875,443
Accounts Receivable - Loans and Receivables		—		—		534,105		—		534,105
Other Assets - Freestanding Derivatives		606		152,047		—		—		152,653
	$	2,079,493	$	1,943,871	$	3,385,588	$	578,801	$	7,987,753
Liabilities
Securities Sold, Not Yet Purchased	$	3,966	$	23,063	$	—	$	—	$	27,029
Accounts Payable, Accrued Expenses and Other Liabilities
Consolidated Blackstone Funds - Freestanding Derivatives		—		1,175		—		—		1,175
Freestanding Derivatives		81		58,346		—		—		58,427
Corporate Treasury Commitments (b)		—		—		8,697		—		8,697
Total Accounts Payable, Accrued Expenses and Other Liabilities		81		59,521		8,697		—		68,299
	$	4,047	$	82,584	$	8,697	$	—	$	95,328

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

	December 31, 2021
	Level I		Level II		Level III		NAV		Total
Assets
Cash and Cash Equivalents	$	173,408	$	—	$	—	$	—	$	173,408
Investments
Investments of Consolidated Blackstone Funds
Equity Securities, Partnerships and LLC Interests (a)		70,484		122,068		1,170,362		382,267		1,745,181
Debt Instruments		642		242,393		29,953		—		272,988
Freestanding Derivatives		—		660		—		—		660
Total Investments of Consolidated Blackstone Funds		71,126		365,121		1,200,315		382,267		2,018,829
Corporate Treasury Investments		86,877		570,712		477		—		658,066
Other Investments (c)		478,892		210,752		2,518,032		4,845		3,212,521
Total Investments		636,895		1,146,585		3,718,824		387,112		5,889,416
Accounts Receivable - Loans and Receivables		—		—		392,732		—		392,732
Other Assets - Freestanding Derivatives		113		145,288		—		—		145,401
	$	810,416	$	1,291,873	$	4,111,556	$	387,112	$	6,600,957
Liabilities
Securities Sold, Not Yet Purchased	$	4,292	$	23,557	$	—	$	—	$	27,849
Accounts Payable, Accrued Expenses and Other Liabilities
Consolidated Blackstone Funds - Freestanding Derivatives		—		1,933		—		—		1,933
Freestanding Derivatives		323		145,552		—		—		145,875
Corporate Treasury Commitments (b)		—		—		636		—		636
Total Accounts Payable, Accrued Expenses and Other Liabilities		323		147,485		636		—		148,444
	$	4,615	$	171,042	$	636	$	—	$	176,293

LLC Limited Liability Company.

(a)	Equity Securities, Partnership and LLC Interest includes investments in investment funds. Prior period amounts have been reclassified to this presentation.
(b)	Corporate Treasury Commitments are measured using third party pricing.
---	---
(c)	Level III Other Investments includes Blackstone’s $2.2 billion equity interest in Corebridge and other investments that were remeasured as the result of an observable transaction. These fair value measurements are nonrecurring and are measured as of either the date of acquisition, which was November 2, 2021 for Corebridge, or as of the date of the observable transaction.
---	---

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

The following table summarizes the quantitative inputs and assumptions used for items categorized in Level III of the fair value hierarchy as of June 30, 2022:

	Fair Value
Financial Assets
Investments of Consolidated Blackstone Funds
Equity Securities, Partnership and LLC Interests	$	2,724,955	Discounted Cash Flows	Discount Rate	4.1% - 40.0%	8.2%	Lower
				Exit Multiple - EBITDA	4.0x - 31.4x	14.9x	Higher
				Exit Capitalization Rate	2.8% - 17.3%	4.4%	Lower
Debt Instruments		66,857	Discounted Cash Flows	Discount Rate	6.5% - 19.3%	12.0%	Lower
			Third Party Pricing	n/a
			Transaction Price	n/a
Total Investments of Consolidated Blackstone Funds		2,791,812
Corporate Treasury Investments		6,022	Discounted Cash Flows	Discount Rate	14.5%	n/a	Lower
			Third Party Pricing	n/a
Loans and Receivables		534,105	Discounted Cash Flows	Discount Rate	6.8% - 11.3%	9.1%	Lower
Other Investments		53,649	Third Party Pricing	n/a
			Transaction Price	n/a
	$	3,385,588

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

The following table summarizes the quantitative inputs and assumptions used for items categorized in Level III of the fair value hierarchy as of December 31, 2021:

	Fair Value
Financial Assets
Investments of Consolidated Blackstone Funds
Equity Securities, Partnership and LLC Interests	$	1,170,362	Discounted Cash Flows	Discount Rate	1.3% - 43.3%	10.4%	Lower
				Exit Multiple - EBITDA	3.7x - 31.4x	14.7x	Higher
				Exit Capitalization Rate	1.3% - 17.3%	4.9%	Lower
Debt Instruments		29,953	Discounted Cash Flows	Discount Rate	6.5% - 19.3%	9.0%	Lower
			Third Party Pricing	n/a
Total Investments of Consolidated Blackstone Funds		1,200,315
Corporate Treasury Investments		477	Discounted Cash Flows	Discount Rate	9.4%	n/a	Lower
			Third Party Pricing	n/a
Loans and Receivables		392,732	Discounted Cash Flows	Discount Rate	6.5% - 12.2%	7.6%	Lower
Other Investments		2,518,032	Third Party Pricing	n/a
			Transaction Price	n/a
	$	4,111,556
n/a	Not applicable.
---	---
EBITDA	Earnings before interest, taxes, depreciation and amortization.
Exit Multiple	Ranges include the last twelve months EBITDA and forward EBITDA multiples.
Third Party Pricing	Third Party Pricing is generally determined on the basis of unadjusted prices between market participants provided by reputable dealers or pricing services.
Transaction Price	Includes recent acquisitions or transactions.
(a)	Unobservable inputs were weighted based on the fair value of the investments included in the range.

For the six months ended June 30, 2022, there have been no changes in valuation techniques within Level II and Level III that have had a material impact on the valuation of financial instruments.

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

The following tables summarize the changes in financial assets and liabilities measured at fair value for which Blackstone has used Level III inputs to determine fair value and does not include gains or losses that were reported in Level III in prior years or for instruments that were transferred out of Level III prior to the end of the respective reporting period. These tables also exclude financial assets and liabilities measured at fair value on a non-recurring basis. Total realized and unrealized gains and losses recorded for Level III investments are reported in either Investment Income (Loss) or Net Gains from Fund Investment Activities in the Condensed Consolidated Statements of Operations.

	Level III Financial Assets at Fair Value<br><br><br>Three Months Ended June 30,
	2022												2021
	Investments												Investments
	of			Loans			Other						of			Loans			Other
	Consolidated			and			Investments						Consolidated			and			Investments
	Funds			Receivables			(a)			Total			Funds			Receivables			(a)			Total
Balance, Beginning of Period	$	1,208,252		$	286,199		$	43,214		$	1,537,665		$	885,228		$	604,611		$	41,160		$	1,530,999
Transfer In Due to Consolidation and Acquisition		1,535,171			—			—			1,535,171			—			—			—			—
Transfer Into Level III (b)		4,692			—			907			5,599			1,266			—			—			1,266
Transfer Out of Level III (b)		(56,268	)		—			—			(56,268	)		(12,187	)		—			—			(12,187	)
Purchases		269,788			441,687			4,752			716,227			99,223			33,434			33,458			166,115
Sales		(103,118	)		(186,532	)		(2,748	)		(292,398	)		(79,993	)		(408,488	)		(1,014	)		(489,495	)
Issuances		—			14,125			—			14,125			—			12,594			—			12,594
Settlements		—			(17,165	)		—			(17,165	)		—			(28,155	)		—			(28,155	)
Changes in Gains (Losses) Included in Earnings		(66,705	)		(4,209	)		(7,522	)		(78,436	)		89,447			9,800			(129	)		99,118
Balance, End of Period	$	2,791,812		$	534,105		$	38,603		$	3,364,520		$	982,984		$	223,796		$	73,475		$	1,280,255
Changes in Unrealized Gains (Losses) Included in Earnings Related to Financial Assets Still Held at the Reporting Date	$	(73,347	)	$	(8,097	)	$	(7,517	)	$	(88,961	)	$	68,862		$	746		$	(128	)	$	69,480
	Level III Financial Assets at Fair Value<br><br> <br>Six Months Ended June 30,
---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---	---
	2022												2021
	Investments												Investments
	of			Loans			Other						of			Loans			Other
	Consolidated			and			Investments						Consolidated			and			Investments
	Funds			Receivables			(a)			Total			Funds			Receivables			(a)			Total
Balance, Beginning of Period	$	1,200,315		$	392,732		$	43,987		$	1,637,034		$	858,310		$	581,079		$	46,158		$	1,485,547
Transfer In Due to Consolidation and Acquisition		1,535,171			—			—			1,535,171			—			—			—			—
Transfer Into Level III (b)		4,696			—			907			5,603			1,804			—			—			1,804
Transfer Out of Level III (b)		(110,176	)		—			—			(110,176	)		(88,841	)		—			—			(88,841	)
Purchases		327,810			444,784			7,498			780,092			186,080			356,763			33,459			576,302
Sales		(167,431	)		(305,025	)		(2,812	)		(475,268	)		(127,985	)		(701,212	)		(6,163	)		(835,360	)
Issuances		—			23,899			—			23,899			—			19,340			—			19,340
Settlements		—			(22,018	)		—			(22,018	)		—			(45,555	)		—			(45,555	)
Changes in Gains (Losses) Included in Earnings		1,427			(267	)		(10,977	)		(9,817	)		153,616			13,381			21			167,018
Balance, End of Period	$	2,791,812		$	534,105		$	38,603		$	3,364,520		$	982,984		$	223,796		$	73,475		$	1,280,255
Changes in Unrealized Gains (Losses) Included in Earnings Related to Financial Assets Still Held at the Reporting Date	$	(20,852	)	$	(7,883	)	$	(10,971	)	$	(39,706	)	$	125,918		$	(3,110	)	$	(71	)	$	122,737
(a)	Represents corporate treasury investments and Other Investments.
---	---
(b)	Transfers in and out of Level III financial assets and liabilities were due to changes in the observability of inputs used in the valuation of such assets and liabilities.
---	---

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

9. Variable Interest Entities

Pursuant to GAAP consolidation guidance, Blackstone consolidates certain VIEs for which it is the primary beneficiary either directly or indirectly, through a consolidated entity or affiliate. VIEs include certain private equity, real estate, credit-focused or funds of hedge funds entities and CLO vehicles. The purpose of such VIEs is to provide strategy specific investment opportunities for investors in exchange for management and performance-based fees. The investment strategies of the Blackstone Funds differ by product; however, the fundamental risks of the Blackstone Funds are similar, including loss of invested capital and loss of management fees and performance-based fees. In Blackstone’s role as general partner, collateral manager or investment adviser, it generally considers itself the sponsor of the applicable Blackstone Fund. Blackstone does not provide performance guarantees and has no other financial obligation to provide funding to consolidated VIEs other than its own capital commitments.

The assets of consolidated variable interest entities may only be used to settle obligations of these entities. In addition, there is no recourse to Blackstone for the consolidated VIEs’ liabilities.

Blackstone holds variable interests in certain VIEs which are not consolidated as it is determined that Blackstone is not the primary beneficiary. Blackstone’s involvement with such entities is in the form of direct and indirect equity interests and fee arrangements. The maximum exposure to loss represents the loss of assets recognized by Blackstone relating to non-consolidated VIEs and any clawback obligation relating to previously distributed Performance Allocations. Blackstone’s maximum exposure to loss relating to non-consolidated VIEs were as follows:

	June 30,		December 31,
	2022		2021
Investments	$	3,432,284	$	3,337,757
Due from Affiliates		205,960		179,939
Potential Clawback Obligation		51,888		44,327
Maximum Exposure to Loss	$	3,690,132	$	3,562,023
Amounts Due to <br>Non-Consolidated<br> VIEs	$	95	$	105

Repurchase Agreements

At June 30, 2022 and December 31, 2021, Blackstone pledged securities with a carrying value of $152.5 million and $63.0 million, respectively, and cash to collateralize its repurchase agreements. Such securities can be repledged, delivered or otherwise used by the counterparty.

The following tables provide information regarding Blackstone’s Repurchase Agreements obligation by type of collateral pledged:

	June 30, 2022
	Remaining Contractual Maturity of the Agreements
	Overnight						Greater
	and		Up to		30 - 90		than
	Continuous		30 Days		Days		90 days		Total
Repurchase Agreements
Loans	$	—	$	—	$	—	$	152,529	$	152,529
Gross Amount of Recognized Liabilities for Repurchase Agreements in Note 11. “Offsetting of Assets and Liabilities”									$	152,529
Amounts Related to Agreements Not Included in Offsetting Disclosure in Note 11. “Offsetting of Assets and Liabilities”									$	—

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

	December 31, 2021
	Remaining Contractual Maturity of the Agreements
	Overnight						Greater
	and		Up to		30 - 90		than
	Continuous		30 Days		Days		90 days		Total
Repurchase Agreements
Asset-Backed Securities	$	—	$	15,980	$	—	$	—	$	15,980
Loans		—		—		42,000		—		42,000
	$	—	$	15,980	$	42,000	$	—	$	57,980
Gross Amount of Recognized Liabilities for Repurchase Agreements in Note 11. “Offsetting of Assets and Liabilities”									$	57,980
Amounts Related to Agreements Not Included in Offsetting Disclosure in Note 11. “Offsetting of Assets and Liabilities”									$	—

Offsetting of Assets and Liabilities

The following tables present the offsetting of assets and liabilities as of June 30, 2022 and December 31, 2021:

	June 30, 2022
	Gross and Net
	Amounts of		Gross Amounts Not Offset
	Assets Presented		in the Statement of
	in the Statement		Financial Condition
	of Financial		Financial		Cash Collateral
	Condition		Instruments (a)		Received		Net Amount
Assets
Freestanding Derivatives	$	181,875	$	73,799	$	103,923	$	4,153
	June 30, 2022
---	---	---	---	---	---	---	---	---
	Gross and Net
	Amounts of
	Liabilities		Gross Amounts Not Offset
	Presented in the		in the Statement of
	Statement of		Financial Condition
	Financial		Financial		Cash Collateral
	Condition		Instruments (a)		Pledged		Net Amount
Liabilities
Freestanding Derivatives	$	59,602	$	53,834	$	2,239	$	3,529
Repurchase Agreements		152,529		152,529		—		—
	$	212,131	$	206,363	$	2,239	$	3,529

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

	December 31, 2021
	Gross and Net
	Amounts of		Gross Amounts Not Offset
	Assets Presented		in the Statement of
	in the Statement		Financial Condition
	of Financial		Financial		Cash Collateral
	Condition		Instruments (a)		Received		Net Amount
Assets
Freestanding Derivatives	$	146,061	$	137,265	$	41	$	8,755
	December 31, 2021
---	---	---	---	---	---	---	---	---
	Gross and Net
	Amounts of
	Liabilities		Gross Amounts Not Offset
	Presented in the		in the Statement of
	Statement of		Financial Condition
	Financial		Financial		Cash Collateral
	Condition		Instruments (a)		Pledged		Net Amount
Liabilities
Freestanding Derivatives	$	147,666	$	118,552	$	1,347	$	27,767
Repurchase Agreements		57,980		57,980		—		—
	$	205,646	$	176,532	$	1,347	$	27,767
(a)	Amounts presented are inclusive of both legally enforceable master netting agreements, and financial instruments received or pledged as collateral. Financial instruments received or pledged as collateral offset derivative counterparty risk exposure, but do not reduce net balance sheet exposure.
---	---

Repurchase Agreements are presented separately in the Condensed Consolidated Statements of Financial Condition. Freestanding Derivative assets are included in Other Assets in the Condensed Consolidated Statements of Financial Condition. The following table presents the components of Other Assets:

	June 30,		December 31,
	2022		2021
Furniture, Equipment and Leasehold Improvements, Net	$	316,389	$	244,608
Prepaid Expenses		183,518		92,359
Freestanding Derivatives		152,653		145,401
Other		5,738		10,568
	$	658,298	$	492,936

Freestanding Derivative liabilities are included in Accounts Payable, Accrued Expenses and Other Liabilities in the Condensed Consolidated Statements of Financial Condition.

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

Notional Pooling Arrangements

Blackstone has notional cash pooling arrangements with financial institutions for cash management purposes. These arrangements allow for cash withdrawals based upon aggregate cash balances on deposit at the same financial institution. Cash withdrawals cannot exceed aggregate cash balances on deposit. The net balance of cash on deposit and overdrafts is used as a basis for calculating net interest expense or income. As of June 30, 2022, the aggregate cash balance on deposit relating to the cash pooling arrangements wa s $1.3 billion, which was offset and reported net of the accompanying overdraft of $1.3 billion.

Borrowings

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 senior notes due June 1, 2034 (the “2034 Notes”). The 2034 Notes have an interest rate of 3.500% per annum accruing from June 1, 2022. Interest on the 2034 Notes is payable annually in arrears on June 1 of each year commencing on June 1, 2023.

All of Blackstone’s outstanding senior notes as of June 30, 2022 are unsecured and unsubordinated obligations of the Issuer that are fully and unconditionally guaranteed by Blackstone Inc. and its indirect subsidiaries, Blackstone Holdings I L.P., Blackstone Holdings AI L.P., Blackstone Holdings II L.P., Blackstone Holdings III L.P. and Blackstone Holdings IV L.P. (the “Guarantors”). The guarantees are unsecured and unsubordinated obligations of the Guarantors. Transaction costs related to senior note issuances have been capitalized and are amortized over the life of each respective note.

On June 3, 2022, Blackstone, through the Issuer, entered into an amended and restate d $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.

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

The following table presents the general characteristics of each of Blackstone’s notes as of June 30, 2022 and December 31, 2021, as well as their carrying value and fair value. The notes are included in Loans Payable within the Condensed Consolidated Statements of Financial Condition. Each of the notes were issued at a discount, accrue interest from the issue date thereof, and pay interest in arrears on a semi-annual basis or annual basis.

	June 30, 2022				December 31, 2021
	Carrying		Fair		Carrying		Fair
Senior Notes	Value		Value (a)		Value		Value (a)
4.750<br>%, Due 2/15/2023	$	399,202	$	399,760	$	398,581	$	415,880
2.000<br>%, Due 5/19/2025		311,967		310,368		338,275		362,078
1.000<br>%, Due 10/5/2026		624,380		582,051		675,867		700,892
3.150<br>%, Due 10/2/2027		297,918		280,830		297,738		317,610
1.625<br>%, Due 8/5/2028		643,987		547,105		643,251		629,265
1.500<br>%, Due 4/10/2029		625,225		551,416		678,085		720,062
2.500<br>%, Due 1/10/2030		492,130		432,050		491,662		507,350
1.600<br>%, Due 3/30/2031		495,764		390,750		495,541		467,750
2.000<br>%, Due 1/30/2032		787,491		636,321		786,690		767,920
2.550<br>%, Due 3/30/2032		494,980		417,600		—		—
3.500<br>%, Due 6/1/2034		512,158		494,373		—		—
6.250<br>%, Due 8/15/2042		239,043		272,725		238,914		361,775
5.000<br>%, Due 6/15/2044		489,573		487,800		489,446		648,500
4.450<br>%, Due 7/15/2045		344,480		317,730		344,412		426,195
4.000<br>%, Due 10/2/2047		290,831		253,170		290,730		347,370
3.500<br>%, Due 9/10/2049		392,174		311,000		392,089		431,240
2.800<br>%, Due 9/30/2050		393,888		271,960		393,818		382,880
2.850<br>%, Due 8/5/2051		543,085		375,760		542,963		531,355
3.200<br>%, Due 1/30/2052		986,998		722,800		—		—
	$	9,365,274	$	8,055,569	$	7,498,062	$	8,018,122
(a)	Fair value is determined by broker quote and these notes would be classified as Level II within the fair value hierarchy.
---	---

Scheduled principal payments for borrowings as of June 30, 2022 were as follows:

	Total
	Borrowings
2022	$	—
2023		400,000
2024		—
2025		314,520
2026		629,040
Thereafter		8,153,240
	$	9,496,800

Income Taxes

Blackstone’s net deferred tax assets relate primarily to basis differences resulting from a step-up in tax basis of certain assets at the time of its conversion to a corporation, as well as ongoing exchanges of units for common shares by founders and partners. As of June 30, 2022, Blackstone had no material valuation allowance recorded against deferred tax assets.

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

Blackstone is subject to examination by the U.S. Internal Revenue Service and other taxing authorities where Blackstone has significant business operations such as the United Kingdom, and various state and local jurisdictions such as New York State and New York City. The tax years under examination vary by jurisdiction. Blackstone does not expect the completion of these audits to have a material impact on its financial condition, but it may be material to operating results for a particular period, depending on the operating results for that period. Blackstone believes the liability established for unrecognized tax benefits is adequate in relation to the potential for additional assessments. It is reasonably possible that changes in the balance of unrecognized tax benefits may occur within the next 12 months; however, it is not possible to reasonably estimate the expected change to the total amount of unrecognized tax benefits and the impact on Blackstone’s effective tax rate over the next 12 months.

As of June 30, 2022, the major jurisdictions and the earliest tax years that remain subject to examination are U.S. federal 2018, New York State 2015, New York City 2009, and the United Kingdom 2011.

Earnings Per Share and Stockholders’ Equity

Earnings Per Share

Basic and diluted net income per share of common stock for the three and six months ended June 30, 2022 and 2021 was calculated as follows:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2022			2021		2022		2021
Net Income (Loss) for Per Share of Common Stock Calculations
Net Income (Loss) Attributable to Blackstone Inc., Basic and Diluted	$	(29,393	)	$	1,309,152	$	1,187,481	$	3,057,024
Shares/Units Outstanding
Weighted-Average Shares of Common Stock Outstanding, Basic		707,382,293			721,141,954		738,752,489		715,121,029
Weighted-Average Shares of Unvested Deferred Restricted Common Stock		—			123,226		388,373		501,179
Weighted-Average Shares of Common Stock Outstanding, Diluted		707,382,293			721,265,180		739,140,862		715,622,208
Net Income (Loss) Per Share of Common Stock
Basic	$	(0.04	)	$	1.82	$	1.61	$	4.27
Diluted	$	(0.04	)	$	1.82	$	1.61	$	4.27
Dividends Declared Per Share of Common Stock (a)	$	1.32		$	0.82	$	2.77	$	1.78
(a)	Dividends declared reflects the calendar date of the declaration for each distribution.
---	---

In computing the dilutive effect that the exchange of Blackstone Holdings Partnership Units would have on Net Income Per Share of Common Stock, Blackstone considered that net income available to holders of shares of common stock would increase due to the elimination of non-controlling interests in Blackstone Holdings, inclusive of any tax impact. The hypothetical conversion may be dilutive to the extent there is activity at the Blackstone Inc. level that has not previously been attributed to the non-controlling interests or if there is a change in tax rate as a result of a hypothetical conversion.

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

The following table summarizes the anti-dilutive securities for the three and six months ended June 30, 2022 and 2021:

	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2022		2021		2022		2021
Weighted-Average Shares of Unvested Deferred Restricted Common Stock		35,883,883		—		—		—
Weighted-Average Blackstone Holdings Partnership Units		466,817,529		488,569,471		467,303,495		490,857,143

Stockholders’ Equity

In connection with the share reclassification, effective February 26, 2021, the Certificate of Incorporation of Blackstone was amended and restated to: (a) rename the Class A common stock as “common stock,” which has the same rights and powers (including, without limitation, with respect to voting) that Blackstone’s Class A common stock formerly had, (b) reclassify the “Class B common stock” into a new “Series I preferred stock,” which has the same rights and powers that the Class B common stock formerly had, and (c) reclassify the Class C common stock into a new “Series II preferred stock,” which has the same rights and powers that the Class C common stock formerly had. In connection with such share reclassification, Blackstone authorized 10 billion shares of preferred stock with a par value of $0.00001, of which (a) 999,999,000 shares are designated as Series I preferred stock and (b) 1,000 shares are designated as Series II preferred stock. The remaining 9 billion shares may be designated from time to time in accordance with Blackstone’s certificate of incorporation. There was 1 share of Series I preferred stock and 1 share of Series II preferred stock issued and outstanding as of June 30, 2022.

Under Blackstone’s certificate of incorporation and Delaware law, holders of Blackstone’s common stock are entitled to vote, together with holders of Blackstone’s Series I preferred stock, voting as a single class, on a number of significant matters, including certain sales, exchanges or other dispositions of all or substantially all of Blackstone’s assets, a merger, consolidation or other business combination, the removal of the Series II Preferred Stockholder and forced transfer by the Series II Preferred Stockholder of its shares of Series II preferred stock and the designation of a successor Series II Preferred Stockholder. The Series II Preferred Stockholder elects Blackstone’s directors. Holders of Blackstone’s Series I preferred stock and Series II preferred stock are not entitled to dividends from Blackstone, or receipt of any of Blackstone’s assets in the event of any dissolution, liquidation or winding up. Blackstone Partners L.L.C. is the sole holder of the Series I preferred stock and Blackstone Group Management L.L.C. is the sole holder of the Series II preferred stock.

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 numbers 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. During the three and six months ended June 30, 2021, Blackstone repurchased 3.2 million shares of common stock at a total cost of $289.1 million. As of June 30, 2022, the amount remaining available for repurchases under the program was $1.3 billion.

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

Shares Eligible for Dividends and Distributions

As of June 30, 2022, the total shares of common stock and Blackstone Holdings Partnership Units entitled to participate in dividends and distributions were as follows:

	Shares/Units
Common Stock Outstanding		706,476,877
Unvested Participating Common Stock		35,710,961
Total Participating Common Stock		742,187,838
Participating Blackstone Holdings Partnership Units		466,568,377
		1,208,756,215

Equity-Based Compensation

Blackstone has granted equity-based compensation awards to Blackstone’s senior managing directors, non-partner professionals, non-professionals and selected external advisers under Blackstone’s Amended and Restated 2007 Equity Incentive Plan (the “Equity Plan”). The Equity Plan allows for the granting of options, share appreciation rights or other share-based awards (shares, restricted shares, restricted shares of common stock, deferred restricted shares of common stock, phantom restricted shares of common stock or other share-based awards based in whole or in part on the fair value of shares of common stock or Blackstone Holdings Partnership Units) which may contain certain service or performance requirements. As of January 1, 2022, Blackstone had the ability to grant 171,096,250 shares under the Equity Plan.

For the three and six months ended June 30, 2022, Blackstone recorded compensation expense of $210.8 million and $429.9 million, respectively, in relation to its equity-based awards with corresponding tax benefits of $12.2 million and $72.9 million, respectively. For the three and six months ended June 30, 2021, Blackstone recorded compensation expense of $ 141.6 million and $305.4 million, respectively, in relation to its equity-based awards with corresponding tax benefits of $18.8 million and $40.7 million, respectively.

As of June 30, 2022, there was $2.1 billion of estimated unrecognized compensation expense related to unvested awards, including compensation with performance conditions where it is probable that the performance condition will be met. This cost is expected to be recognized over a weighted-average period of 3.4 years.

Total vested and unvested outstanding shares, including common stock, Blackstone Holdings Partnership Units and deferred restricted shares of common stock, were 1,208,883,091 as of June 30, 2022. Total outstanding phantom shares were 62,405 as of June 30, 2022.

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

A summary of the status of Blackstone’s unvested equity-based awards as of June 30, 2022 and of changes during the period January 1, 2022 through June 30, 2022 is presented below:

	Blackstone Holdings					Blackstone Inc.
						Equity Settled Awards					Cash Settled Awards
				Weighted-					Weighted-					Weighted-
				Average		Deferred			Average					Average
	Partnership			Grant Date		Restricted Shares			Grant Date		Phantom			Grant Date
Unvested Shares/Units	Units			Fair Value		of Common Stock			Fair Value		Shares			Fair Value
Balance, December 31, 2021		17,344,328		$	37.37		26,537,813		$	58.34		73,581		$	137.65
Granted		—			—		11,210,550			127.77		28,037			126.03
Vested		(1,262,132	)		34.82		(2,818,889	)		70.94		(1,980	)		130.22
Forfeited		(116,197	)		38.24		(656,754	)		71.25		(46,412	)		130.22
Balance, June 30, 2022		15,965,999		$	37.57		34,272,720		$	79.89		53,226		$	121.71

Shares/Units Expected to Vest

The following unvested shares and units, after expected forfeitures, as of June 30, 2022, are expected to vest:

			Weighted-
			Average
			Service Period
	Shares/Units		in Years
Blackstone Holdings Partnership Units		15,473,779	1.6
Deferred Restricted Shares of Common Stock		29,650,267	3.3
Total Equity-Based Awards		45,124,046	2.7
Phantom Shares		41,966	3.4

Related Party Transactions

Affiliate Receivables and Payables

Due from Affiliates and Due to Affiliates consisted of the following:

	June 30,		December 31,
	2022		2021
Due from Affiliates
Management Fees, Performance Revenues, Reimbursable Expenses and Other Receivables from <br>Non-Consolidated<br> Entities and Portfolio Companies	$	3,053,633	$	3,519,945
Due from Certain <br>Non-Controlling<br> Interest Holders and Blackstone Employees		795,987		1,099,899
Accrual for Potential Clawback of Previously Distributed Performance Allocations		42,338		37,023
	$	3,891,958	$	4,656,867

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

	June 30,		December 31,
	2022		2021
Due to Affiliates
Due to Certain <br>Non-Controlling<br> Interest Holders in Connection with the Tax Receivable Agreements	$	1,561,842	$	1,558,393
Due to <br>Non-Consolidated<br> Entities		185,689		181,341
Due to Certain <br>Non-Controlling<br> Interest Holders and Blackstone Employees		151,183		77,664
Accrual for Potential Repayment of Previously Received Performance Allocations		102,677		88,700
	$	2,001,391	$	1,906,098

Interests of the Founder, Senior Managing Directors, Employees and Other Related Parties

The Founder, senior managing directors, employees and certain other related parties invest on a discretionary basis in the consolidated Blackstone Funds both directly and through consolidated entities. These investments generally are subject to preferential management fee and performance allocation or incentive fee arrangements. As of June 30, 2022 and December 31, 2021, such investments aggregated $1.6 billion and $1.6 billion, respectively. Their share of the Net Income Attributable to Redeemable Non-Controlling and Non-Controlling Interests in Consolidated Entities aggregated to $(74.8) million and $116.2 million for the three months ended June 30, 2022 and 2021, respectively, and $(10.4) million and $233.6 million for the six months ended June 30, 2022 and 2021, respectively.

Loans to Affiliates

Loans to affiliates consist of interest bearing advances to certain Blackstone individuals to finance their investments in certain Blackstone Funds. These loans earn interest at Blackstone’s cost of borrowing and such interest totaled $1.4 million and $1.0 million for the three months ended June 30, 2022 and 2021, respectively, and $3.8 million and $3.3 million for the six months ended June 30, 2022 and 2021, respectively.

Contingent Repayment Guarantee

Blackstone and its personnel who have received Performance Allocation distributions have guaranteed payment on a several basis (subject to a cap) to the carry funds of any clawback obligation with respect to the excess Performance Allocation allocated to the general partners of such funds and indirectly received thereby to the extent that either Blackstone or its personnel fails to fulfill its clawback obligation, if any. The Accrual for Potential Repayment of Previously Received Performance Allocations represents amounts previously paid to Blackstone Holdings and non-controlling interest holders that would need to be repaid to the Blackstone Funds if the carry funds were to be liquidated based on the fair value of their underlying investments as of June 30, 2022. See Note 17. “Commitments and Contingencies — Contingencies — Contingent Obligations (Clawback).”

Tax Receivable Agreements

Blackstone used a portion of the proceeds from the IPO and other sales of shares to purchase interests in the predecessor businesses from the predecessor owners. In addition, holders of Blackstone Holdings Partnership Units may exchange their Blackstone Holdings Partnership Units for shares of Blackstone common stock on a one-for-one basis. The purchase and subsequent exchanges are expected to result in increases in the tax basis of the tangible and intangible assets of Blackstone Holdings and therefore reduce the amount of tax that Blackstone would otherwise be required to pay in the future.

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Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

Blackstone has entered into tax receivable agreements with each of the predecessor owners and additional tax receivable agreements have been executed, and will continue to be executed, with newly-admitted senior managing directors and others who acquire Blackstone Holdings Partnership Units. The agreements provide for the payment by the corporate taxpayer to such owners of 85% of the amount of cash savings, if any, in U.S. federal, state and local income tax that the corporate taxpayers actually realize as a result of the aforementioned increases in tax basis and of certain other tax benefits related to entering into these tax receivable agreements. For purposes of the tax receivable agreements, cash savings in income tax will be computed by comparing the actual income tax liability of the corporate taxpayers to the amount of such taxes that the corporate taxpayers would have been required to pay had there been no increase to the tax basis of the tangible and intangible assets of Blackstone Holdings as a result of the exchanges and had the corporate taxpayers not entered into the tax receivable agreements.

Assuming no future material changes in the relevant tax law and that the corporate taxpayers earn sufficient taxable income to realize the full tax benefit of the increased amortization of the assets, the expected future payments under the tax receivable agreements (which are taxable to the recipients) will aggregate $1.6 billion over the next 15 years. The after-tax net present value of these estimated payments totals $438.4 million assuming a 15% discount rate and using Blackstone’s most recent projections relating to the estimated timing of the benefit to be received. Future payments under the tax receivable agreements in respect of subsequent exchanges would be in addition to these amounts. The payments under the tax receivable agreements are not conditioned upon continued ownership of Blackstone equity interests by the pre-IPO owners and the others mentioned above.

Amounts related to the deferred tax asset resulting from the increase in tax basis from the exchange of Blackstone Holdings Partnership Units to shares of Blackstone common stock, the resulting remeasurement of net deferred tax assets at the Blackstone ownership percentage at the balance sheet date, the due to affiliates for the future payments resulting from the tax receivable agreements and resulting adjustment to partners’ capital are included as Acquisition of Ownership Interests from Non-Controlling Interest Holders in the Supplemental Disclosure of Non-Cash Investing and Financing Activities in the Condensed Consolidated Statements of Cash Flows.

Other

Blackstone does business with and on behalf of some of its Portfolio Companies; all such arrangements are on a negotiated basis.

Additionally, please see Note 17. “Commitments and Contingencies — Contingencies — Guarantees” for information regarding guarantees provided to a lending institution for certain loans held by employees.

Commitments and Contingencies

Commitments

Investment Commitments

Blackstone had $5.7 billion of investment commitments as of June 30, 2022 representing general partner capital funding commitments to the Blackstone Funds, limited partner capital funding to other funds and Blackstone principal investment commitments, including loan commitments. The consolidated Blackstone Funds had signed investment commitments of $206.8 million as of June 30, 2022, which includes $68.4 million of signed investment commitments for fund investments in the process of closing.

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Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

Contingencies

Guarantees

Certain of Blackstone’s consolidated real estate funds guarantee payments to third parties in connection with the ongoing business activities and/or acquisitions of their Portfolio Companies. There is no direct recourse to Blackstone to fulfill such obligations. To the extent that underlying funds are required to fulfill guarantee obligations, Blackstone’s invested capital in such funds is at risk. Total investments at risk in respect of guarantees extended by consolidated real estate funds was $36.0 million as of June 30, 2022.

The Blackstone Holdings Partnerships provided guarantees to a lending institution for certain loans held by employees either for investment in Blackstone Funds or for members’ capital contributions to The Blackstone Group International Partners LLP. The amount guaranteed as of June 30, 2022 was $86.0 million.

Litigation

Blackstone may from time to time be involved in litigation and claims incidental to the conduct of its business. Blackstone’s businesses are also subject to extensive regulation, which may result in regulatory proceedings against Blackstone.

Blackstone accrues a liability for legal proceedings only when those matters present loss contingencies that are both probable and reasonably estimable. In such cases, there may be an exposure to loss in excess of any amounts accrued. Although there can be no assurance of the outcome of such legal actions, based on information known by management, Blackstone does not have a potential liability related to any current legal proceeding or claim that would individually or in the aggregate materially affect its results of operations, financial position or cash flows.

Blackstone continues to believe that the following suits against Blackstone are totally without merit and intends to defend them vigorously.

In December 2017, eight pension plan members of the Kentucky Retirement System (“KRS”) filed a derivative lawsuit on behalf of KRS in the Franklin County Circuit Court of the Commonwealth of Kentucky (the “Mayberry Action”). The Mayberry Action alleged various breaches of fiduciary duty and other violations of Kentucky state law in connection with KRS’s investment in three hedge funds of funds, including a fund managed by Blackstone Alternative Asset Management L.P. (“BLP”). The suit named more than 30 defendants, including, among others, The Blackstone Group L.P. (now Blackstone Inc.); BLP; Stephen A. Schwarzman, as Chairman and CEO of Blackstone; and J. Tomilson Hill, as then-CEO of BLP (collectively, the “Blackstone Defendants”). In July 2020, the Kentucky Supreme Court directed the Circuit Court to dismiss the action due to the plaintiffs’ lack of standing.

Over the objection of the Blackstone Defendants and others, in December 2020, the Circuit Court permitted the Attorney General of the Commonwealth of Kentucky (the “AG”) to intervene in the Mayberry Action. Motions to dismiss are currently pending in the Mayberry Action and discovery has begun. The Blackstone Defendants and others are also pursuing an interlocutory appeal asserting that the Circuit Court did not have jurisdiction to continue the Mayberry Action after the ruling of the Kentucky Supreme Court.

In January 2021, certain former plaintiffs in the Mayberry Action filed a separate action (“Taylor I”), against the Blackstone Defendants and other defendants named in the Mayberry Action, asserting allegations substantially similar to those made in the Mayberry Action, and in July 2021 they amended their complaint to add class action allegations. Defendants removed Taylor I to the U.S. District Court for the Eastern District of Kentucky, and in March 2022, the District Court stayed Taylor I pending the resolution of the AG’s suit in the Mayberry Action.

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Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

In August 2021, a group of KRS members—including those that filed Taylor I—filed a new action in Franklin County Circuit Court (“Taylor II”), against the Blackstone Defendants, other defendants named in the Mayberry Action, and other KRS officials. The filed complaint is substantially similar to that filed in Taylor I and the Mayberry Action. Motions to dismiss are pending.

In May 2022, the presiding judge recused himself from the Mayberry Action and Taylor II and the cases were reassigned to another judge in the Franklin County Circuit Court.

In April 2021, the AG filed an action (the “Declaratory Judgment Action”), against BLP and the other fund manager defendants from the Mayberry Action in Franklin County Circuit Court. The action sought to have certain provisions in the subscription agreements between KRS and the fund managers declared to be in violation of the Kentucky Constitution. In March 2022, the Circuit Court granted summary judgment to the AG. BLP’s appeal is currently pending.

In July 2021, BLP filed a breach of contract action against defendants affiliated with KRS alleging that the Mayberry Action and the Declaratory Judgment Action breach the parties’ subscription agreements governing KRS’s investment with BLP. The action seeks damages, including legal fees and expenses incurred in defending against the above actions. In April 2022, the Circuit Court dismissed BLP’s complaint without prejudice to refiling, on the grounds that the action was not yet ripe for adjudication. BLP’s appeal is currently pending.

Contingent Obligations (Clawback)

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 actual clawback liability, however, generally does not become realized until the end of a fund’s life except for certain Blackstone real estate funds, multi-asset class investment funds and credit-focused funds, which may have an interim clawback liability. The lives of the carry funds, including available contemplated extensions, for which a liability for potential clawback obligations has been recorded for financial reporting purposes, are currently anticipated to expire at various points through 2032. Further extensions of such terms may be implemented under given circumstances.

For financial reporting purposes, when applicable, the general partners record a liability for potential clawback obligations to the limited partners of some of the carry funds due to changes in the unrealized value of a fund’s remaining investments and where the fund’s general partner has previously received Performance Allocation distributions with respect to such fund’s realized investments.

The following table presents the clawback obligations by segment:

	June 30, 2022						December 31, 2021
			Current and						Current and
	Blackstone		Former				Blackstone		Former
Segment	Holdings		Personnel (a)		Total (b)		Holdings		Personnel (a)		Total (b)
Real Estate	$	36,220	$	21,200	$	57,420	$	34,080	$	20,186	$	54,266
Private Equity		11,591		6,421		18,012		5,158		2,196		7,354
Credit & Insurance		12,559		14,686		27,245		12,439		14,641		27,080
	$	60,370	$	42,307	$	102,677	$	51,677	$	37,023	$	88,700
(a)	The split of clawback between Blackstone Holdings and Current and Former Personnel is based on the performance of individual investments held by a fund rather than on a fund by fund basis.
---	---
(b)	Total is a component of Due to Affiliates. See Note 16. “Related Party Transactions — Affiliate Receivables and Payables — Due to Affiliates.”
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Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

For Private Equity, Real Estate, and certain Credit & Insurance Funds, a portion of the Performance Allocations paid to current and former Blackstone personnel is held in segregated accounts in the event of a cash clawback obligation. These segregated accounts are not included in the Condensed Consolidated Financial Statements of Blackstone, except to the extent a portion of the assets held in the segregated accounts may be allocated to a consolidated Blackstone fund of hedge funds. At June 30, 202 2, $1.2 billion was held in segregated accounts for the purpose of meeting any clawback obligations of current and former personnel if such payments are required.

In the Credit & Insurance segment, payment of Performance Allocations to Blackstone by the majority of the stressed/distressed, mezzanine and credit alpha strategies funds are substantially deferred under the terms of the partnership agreements. This deferral mitigates the need to hold funds in segregated accounts in the event of a cash clawback obligation.

If, at June 30, 2022, all of the investments held by Blackstone’s carry funds were deemed worthless, a possibility that management views as remote, the amount of Performance Allocations subject to potential clawback would be $6.2 billion, on an after-tax basis where applicable, of which Blackstone Holdings is potentially liable for $5.8 billion if current and former Blackstone personnel default on their share of the liability, a possibility that management also views as remote.

18.	Segment Reporting

Blackstone conducts its alternative asset management businesses through four segments:

•	Real Estate – Blackstone’s Real Estate segment primarily comprises its management of opportunistic real estate funds, Core+ real estate funds, high-yield real estate debt funds and liquid real estate debt funds.
•	Private Equity – Blackstone’s Private Equity segment includes its management of flagship corporate private equity funds, sector and geographically-focused corporate private equity funds, core private equity funds, an opportunistic investment platform, a secondary fund of funds business, infrastructure-focused funds, a life sciences investment platform, a growth equity investment platform, a multi-asset investment program for eligible high net worth investors and a capital markets services business.
---	---
•	Hedge Fund Solutions – The largest component of Blackstone’s Hedge Fund Solutions segment is Blackstone Alternative Asset Management, which manages a broad range of commingled and customized hedge fund of fund solutions. The segment also includes a GP Stakes business and investment platforms that invest directly, as well as investment platforms that seed new hedge fund businesses and create alternative solutions through daily liquidity products.
---	---
•	Credit & Insurance – Blackstone’s Credit & Insurance segment consists principally of Blackstone Credit, which is organized into two overarching strategies: private credit (which includes mezzanine and direct lending funds, private placement strategies and energy strategies, including our sustainable resources platform) and liquid credit (which consists of CLOs, closed-ended funds, open-ended funds and separately managed accounts). In addition, the segment includes an insurer-focused platform, an asset-based finance platform and publicly traded master limited partnership investment platform.
---	---

These business segments are differentiated by their various investment strategies. Each of the segments primarily earns its income from management fees and investment returns on assets under management.

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Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

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.

For segment reporting purposes, Segment Distributable Earnings is presented along with its major components, Fee Related Earnings and Net Realizations. Fee Related Earnings is 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. Net Realizations is the sum of Realized Principal Investment Income and Realized Performance Revenues less Realized Performance Compensation. Performance Allocations and Incentive Fees are presented together and referred to collectively as Performance Revenues or Performance Compensation.

Segment Presentation

The following tables present the financial data for Blackstone’s four segments for the three months ended June 30, 2022 and 2021:

	Three Months Ended June 30, 2022
	Real			Private			Hedge Fund			Credit &			Total
	Estate			Equity			Solutions			Insurance			Segments
Management and Advisory Fees, Net
Base Management Fees	$	611,751		$	433,459		$	145,077		$	306,589		$	1,496,876
Transaction, Advisory and Other Fees, Net		46,974			27,551			3,450			7,117			85,092
Management Fee Offsets		(689	)		(23,157	)		(40	)		(1,165	)		(25,051	)
Total Management and Advisory Fees, Net		658,036			437,853			148,487			312,541			1,556,917
Fee Related Performance Revenues		265,507			—			—			81,086			346,593
Fee Related Compensation		(273,893	)		(152,622	)		(57,863	)		(137,035	)		(621,413	)
Other Operating Expenses		(88,329	)		(83,233	)		(26,066	)		(63,882	)		(261,510	)
Fee Related Earnings		561,321			201,998			64,558			192,710			1,020,587
Realized Performance Revenues		1,997,720			122,884			7,197			78,973			2,206,774
Realized Performance Compensation		(831,402	)		(57,380	)		(2,083	)		(36,109	)		(926,974	)
Realized Principal Investment Income (Loss)		29,116			8,904			(1,530	)		7,019			43,509
Total Net Realizations		1,195,434			74,408			3,584			49,883			1,323,309
Total Segment Distributable Earnings	$	1,756,755		$	276,406		$	68,142		$	242,593		$	2,343,896

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Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

	Three Months Ended June 30, 2021
	Real			Private			Hedge Fund			Credit &			Total
	Estate			Equity			Solutions			Insurance			Segments
Management and Advisory Fees, Net
Base Management Fees	$	453,664		$	364,606		$	155,244		$	166,537		$	1,140,051
Transaction, Advisory and Other Fees, Net		38,080			32,272			1,558			6,215			78,125
Management Fee Offsets		(493	)		(3,601	)		(203	)		(1,137	)		(5,434	)
Total Management and Advisory Fees, Net		491,251			393,277			156,599			171,615			1,212,742
Fee Related Performance Revenues		33,776			—			—			15,113			48,889
Fee Related Compensation		(121,957	)		(136,767	)		(38,638	)		(78,023	)		(375,385	)
Other Operating Expenses		(54,760	)		(61,041	)		(21,873	)		(44,504	)		(182,178	)
Fee Related Earnings		348,310			195,469			96,088			64,201			704,068
Realized Performance Revenues		351,053			383,010			17,056			41,819			792,938
Realized Performance Compensation		(154,928	)		(159,375	)		(5,626	)		(18,342	)		(338,271	)
Realized Principal Investment Income		28,129			27,796			2,125			5,082			63,132
Total Net Realizations		224,254			251,431			13,555			28,559			517,799
Total Segment Distributable Earnings	$	572,564		$	446,900		$	109,643		$	92,760		$	1,221,867

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Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

The following tables present the financial data for Blackstone’s four segments as of June 30, 2022 and for the six months ended June 30, 2022 and 2021:

	June 30, 2022 and the Six Months Then Ended
	Real			Private			Hedge Fund			Credit &			Total
	Estate			Equity			Solutions			Insurance			Segments
Management and Advisory Fees, Net
Base Management Fees	$	1,191,937		$	854,931		$	290,123		$	599,034		$	2,936,025
Transaction, Advisory and Other Fees, Net		87,459			40,209			4,919			16,514			149,101
Management Fee Offsets		(1,649	)		(50,299	)		(109	)		(2,784	)		(54,841	)
Total Management and Advisory Fees, Net		1,277,747			844,841			294,933			612,764			3,030,285
Fee Related Performance Revenues		757,024			(648	)		—			148,282			904,658
Fee Related Compensation		(618,735	)		(303,672	)		(105,098	)		(264,379	)		(1,291,884	)
Other Operating Expenses		(154,332	)		(150,977	)		(49,250	)		(121,049	)		(475,608	)
Fee Related Earnings		1,261,704			389,544			140,585			375,618			2,167,451
Realized Performance Revenues		2,800,636			573,122			36,110			109,716			3,519,584
Realized Performance Compensation		(1,121,433	)		(264,083	)		(11,083	)		(49,495	)		(1,446,094	)
Realized Principal Investment Income		83,091			74,342			13,371			29,800			200,604
Total Net Realizations		1,762,294			383,381			38,398			90,021			2,274,094
Total Segment Distributable Earnings	$	3,023,998		$	772,925		$	178,983		$	465,639		$	4,441,545
Segment Assets	$	14,267,173		$	14,636,045		$	2,777,317		$	6,979,467		$	38,660,002

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Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

	Six Months Ended June 30, 2021
	Real			Private			Hedge Fund			Credit &			Total
	Estate			Equity			Solutions			Insurance			Segments
Management and Advisory Fees, Net
Base Management Fees	$	880,850		$	742,266		$	305,777		$	328,448		$	2,257,341
Transaction, Advisory and Other Fees, Net		64,099			74,979			5,904			11,783			156,765
Management Fee Offsets		(2,116	)		(17,520	)		(261	)		(3,262	)		(23,159	)
Total Management and Advisory Fees, Net		942,833			799,725			311,420			336,969			2,390,947
Fee Related Performance Revenues		189,168			—			—			28,889			218,057
Fee Related Compensation		(310,449	)		(277,364	)		(77,488	)		(155,194	)		(820,495	)
Other Operating Expenses		(99,122	)		(112,096	)		(41,045	)		(91,339	)		(343,602	)
Fee Related Earnings		722,430			410,265			192,887			119,325			1,444,907
Realized Performance Revenues		439,691			638,855			48,629			67,086			1,194,261
Realized Performance Compensation		(177,690	)		(270,584	)		(12,534	)		(28,387	)		(489,195	)
Realized Principal Investment Income		128,949			143,199			37,675			51,465			361,288
Total Net Realizations		390,950			511,470			73,770			90,164			1,066,354
Total Segment Distributable Earnings	$	1,113,380		$	921,735		$	266,657		$	209,489		$	2,511,261

Reconciliations of Total Segment Amounts

The following tables reconcile the Total Segment Revenues, Expenses and Distributable Earnings to their equivalent GAAP measure for the three and six months ended June 30, 2022 and 2021 along with Total Assets as of June 30, 2022:

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2022			2021			2022			2021
Revenues
Total GAAP Revenues	$	629,220		$	5,291,354		$	5,755,500		$	10,590,226
Less: Unrealized Performance Revenues (a)		3,467,668			(2,697,170	)		2,174,618			(5,161,667	)
Less: Unrealized Principal Investment (Income) Loss (b)		203,288			(104,658	)		176,530			(528,592	)
Less: Interest and Dividend Revenue (c)		(66,143	)		(32,931	)		(120,628	)		(64,343	)
Less: Other Revenue (d)		(155,704	)		(27,870	)		(228,523	)		(88,143	)
Impact of Consolidation (e)		75,099			(312,076	)		(102,497	)		(581,392	)
Transaction-Related Charges (f)		(237	)		12			(1,450	)		(3,611	)
Intersegment Eliminations		602			1,040			1,581			2,075
Total Segment Revenue (g)	$	4,153,793		$	2,117,701		$	7,655,131		$	4,164,553

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Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2022			2021			2022			2021
Expenses
Total GAAP Expenses	$	744,113		$	2,272,330		$	2,941,135		$	4,323,777
Less: Unrealized Performance Allocations Compensation (h)		1,386,543			(1,150,219	)		914,259			(2,200,188	)
Less: Equity-Based Compensation (i)		(195,644	)		(121,422	)		(397,189	)		(265,694	)
Less: Interest Expense (j)		(69,425	)		(44,132	)		(136,027	)		(88,472	)
Impact of Consolidation (e)		(11,394	)		(6,647	)		(19,200	)		(11,747	)
Amortization of Intangibles (k)		(17,044	)		(17,044	)		(34,088	)		(34,168	)
Transaction-Related Charges (f)		(25,378	)		(35,521	)		(51,924	)		(67,032	)
Administrative Fee Adjustment (l)		(2,476	)		(2,551	)		(4,961	)		(5,259	)
Intersegment Eliminations		602			1,040			1,581			2,075
Total Segment Expenses (m)	$	1,809,897		$	895,834		$	3,213,586		$	1,653,292
	Three Months Ended						Six Months Ended
---	---	---	---	---	---	---	---	---	---	---	---	---
	June 30,						June 30,
	2022			2021			2022			2021
Other Income
Total GAAP Other Income	$	(104,339	)	$	126,724		$	(52,702	)	$	249,987
Impact of Consolidation (e)		104,339			(126,724	)		52,702			(249,987	)
Total Segment Other Income	$	—		$	—		$	—		$	—

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Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2022			2021			2022			2021
Income (Loss) Before Provision for Taxes
Total GAAP Income (Loss) Before Provision for Taxes	$	(219,232	)	$	3,145,748		$	2,761,663		$	6,516,436
Less: Unrealized Performance Revenues (a)		3,467,668			(2,697,170	)		2,174,618			(5,161,667	)
Less: Unrealized Principal Investment (Income) Loss (b)		203,288			(104,658	)		176,530			(528,592	)
Less: Interest and Dividend Revenue (c)		(66,143	)		(32,931	)		(120,628	)		(64,343	)
Less: Other Revenue (d)		(155,704	)		(27,870	)		(228,523	)		(88,143	)
Plus: Unrealized Performance Allocations Compensation (h)		(1,386,543	)		1,150,219			(914,259	)		2,200,188
Plus: Equity-Based Compensation (i)		195,644			121,422			397,189			265,694
Plus: Interest Expense (j)		69,425			44,132			136,027			88,472
Impact of Consolidation (e)		190,832			(432,153	)		(30,595	)		(819,632	)
Amortization of Intangibles (k)		17,044			17,044			34,088			34,168
Transaction-Related Charges (f)		25,141			35,533			50,474			63,421
Administrative Fee Adjustment (l)		2,476			2,551			4,961			5,259
Total Segment Distributable Earnings	$	2,343,896		$	1,221,867		$	4,441,545		$	2,511,261
	As of
---	---	---	---
	June 30,
	2022
Total Assets
Total GAAP Assets	$	41,631,308
Impact of Consolidation (e)		(2,971,306	)
Total Segment Assets	$	38,660,002

Segment basis presents revenues and expenses on a basis that deconsolidates the investment funds Blackstone manages and excludes the amortization of intangibles and Transaction-Related Charges.

(a)	This adjustment removes Unrealized Performance Revenues on a segment basis.
(b)	This adjustment removes Unrealized Principal Investment Income (Loss) on a segment basis.
---	---
(c)	This adjustment removes Interest and Dividend Revenue on a segment basis.
---	---
(d)	This adjustment removes Other Revenue on a segment basis. For the three months ended June 30, 2022 and 2021, Other Revenue on a GAAP basis was $155.6 million and $27.9 million, and included $155.5 million and $27.3 million of foreign exchange gains, respectively. For the six months ended June 30, 2022 and 2021, Other Revenue on a GAAP basis was $228.5 million and $88.2 million, and included $228.2 million and $86.9 million of foreign exchange gains, respectively.
---	---
(e)	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, the removal of revenue from the reimbursement of certain expenses by the Blackstone Funds, which are presented gross under GAAP but netted against Management and Advisory Fees, Net in the Total Segment measures, and the removal of amounts associated with the ownership of Blackstone consolidated operating partnerships held by <br>non-controlling<br> interests.
---	---

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

(f)	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.
(g)	Total Segment Revenues is comprised of the following:
---	---
	Three Months Ended<br>June 30,				Six Months Ended<br><br><br>June 30,
---	---	---	---	---	---	---	---	---
	2022		2021		2022		2021
Total Segment Management and Advisory Fees, Net	$	1,556,917	$	1,212,742	$	3,030,285	$	2,390,947
Total Segment Fee Related Performance Revenues		346,593		48,889		904,658		218,057
Total Segment Realized Performance Revenues		2,206,774		792,938		3,519,584		1,194,261
Total Segment Realized Principal Investment Income		43,509		63,132		200,604		361,288
Total Segment Revenues	$	4,153,793	$	2,117,701	$	7,655,131	$	4,164,553
(h)	This adjustment removes Unrealized Performance Allocations Compensation.
---	---
(i)	This adjustment removes Equity-Based Compensation on a segment basis.
---	---
(j)	This adjustment adds back Interest Expense on a segment basis, excluding interest expense related to the Tax Receivable Agreement.
---	---
(k)	This adjustment removes the amortization of transaction-related intangibles, which are excluded from Blackstone’s segment presentation.
---	---
(l)	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.
---	---
(m)	Total Segment Expenses is comprised of the following:
---	---
	Three Months Ended<br>June 30,				Six Months Ended<br><br><br>June 30,
---	---	---	---	---	---	---	---	---
	2022		2021		2022		2021
Total Segment Fee Related Compensation	$	621,413	$	375,385	$	1,291,884	$	820,495
Total Segment Realized Performance Compensation		926,974		338,271		1,446,094		489,195
Total Segment Other Operating Expenses		261,510		182,178		475,608		343,602
Total Segment Expenses	$	1,809,897	$	895,834	$	3,213,586	$	1,653,292

6 0

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

Reconciliations of Total Segment Components

The following tables reconcile the components of Total Segments to their equivalent GAAP measures, reported on the Condensed Consolidated Statement of Operations for the three and six months ended June 30, 2022 and 2021:

	Three Months Ended					Six Months Ended
	June 30,					June 30,
	2022			2021		2022			2021
Management and Advisory Fees, Net
GAAP	$	1,561,187		$	1,212,549	$	3,037,123		$	2,390,364
Segment Adjustment (a)		(4,270	)		193		(6,838	)		583
Total Segment	$	1,556,917		$	1,212,742	$	3,030,285		$	2,390,947
	Three Months Ended						Six Months Ended
---	---	---	---	---	---	---	---	---	---	---	---	---
	June 30,						June 30,
	2022			2021			2022			2021
GAAP Realized Performance Revenues to Total Segment Fee Related Performance Revenues
GAAP
Incentive Fees	$	99,598		$	33,207		$	204,087		$	69,331
Investment Income - Realized Performance Allocations		2,453,769			808,620			4,220,155			1,342,987
GAAP		2,553,367			841,827			4,424,242			1,412,318
Total Segment
Less: Realized Performance Revenues		(2,206,774	)		(792,938	)		(3,519,584	)		(1,194,261	)
Total Segment	$	346,593		$	48,889		$	904,658		$	218,057

6 1

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2022			2021			2022			2021
GAAP Compensation to Total Segment Fee Related Compensation
GAAP
Compensation	$	686,012		$	507,104		$	1,342,517		$	1,049,742
Incentive Fee Compensation		45,363			14,431			86,382			27,756
Realized Performance Allocations Compensation		1,035,916			347,423			1,753,517			560,450
GAAP		1,767,291			868,958			3,182,416			1,637,948
Total Segment
Less: Realized Performance Compensation		(926,974	)		(338,271	)		(1,446,094	)		(489,195	)
Less: Equity-Based Compensation - Fee Related Compensation		(191,769	)		(119,491	)		(392,156	)		(261,165	)
Less: Equity-Based Compensation - Performance <br>Compensation		(3,875	)		(1,931	)		(5,033	)		(4,529	)
Segment Adjustment (b)		(23,260	)		(33,880	)		(47,249	)		(62,564	)
Total Segment	$	621,413		$	375,385		$	1,291,884		$	820,495
	Three Months Ended						Six Months Ended
---	---	---	---	---	---	---	---	---	---	---	---	---
	June 30,						June 30,
	2022			2021			2022			2021
GAAP General, <br>Administrative<br>and Other to <br>Total<br>Segment Other Operating Expenses
GAAP	$	289,288		$	205,057		$	529,962		$	390,179
Segment Adjustment (c)		(27,778	)		(22,879	)		(54,354	)		(46,577	)
Total Segment	$	261,510		$	182,178		$	475,608		$	343,602
	Three Months Ended						Six Months Ended
---	---	---	---	---	---	---	---	---	---	---	---	---
	June 30,						June 30,
	2022			2021			2022			2021
Realized Performance Revenues
GAAP
Incentive Fees	$	99,598		$	33,207		$	204,087		$	69,331
Investment Income - Realized <br>Performance<br>Allocations		2,453,769			808,620			4,220,155			1,342,987
GAAP		2,553,367			841,827			4,424,242			1,412,318
Total Segment
Less: Fee Related Performance Revenues		(346,593	)		(48,889	)		(904,658	)		(218,057	)
Total Segment	$	2,206,774		$	792,938		$	3,519,584		$	1,194,261

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2022			2021			2022			2021
Realized Performance Compensation
GAAP
Incentive Fee Compensation	$	45,363		$	14,431		$	86,382		$	27,756
Realized Performance Allocation Compensation		1,035,916			347,423			1,753,517			560,450
GAAP		1,081,279			361,854			1,839,899			588,206
Total Segment
Less: Fee Related Performance Compensation (d)		(150,430	)		(21,652	)		(388,772	)		(94,482	)
Less: Equity-Based Compensation - Performance Compensation		(3,875	)		(1,931	)		(5,033	)		(4,529	)
Total Segment	$	926,974		$	338,271		$	1,446,094		$	489,195
	Three Months Ended						Six Months Ended
---	---	---	---	---	---	---	---	---	---	---	---	---
	June 30,						June 30,
	2022			2021			2022			2021
Realized Principal Investment Income
GAAP	$	265,161		$	152,060		$	550,265		$	507,098
Segment Adjustment (e)		(221,652	)		(88,928	)		(349,661	)		(145,810	)
Total Segment	$	43,509		$	63,132		$	200,604		$	361,288

Segment basis presents revenues and expenses on a basis that deconsolidates the investment funds Blackstone manages and excludes the amortization of intangibles, the expense of equity-based awards and Transaction-Related Charges.

(a)	Represents (1) the add back of net management fees earned from consolidated Blackstone Funds which have been eliminated in consolidation, and (2) the removal of revenue from the reimbursement of certain expenses by the Blackstone Funds, which are presented gross under GAAP but netted against Management and Advisory Fees, Net in the Total Segment measures.
(b)	Represents the removal of Transaction-Related Charges that are not recorded in the Total Segment measures.
---	---
(c)	Represents the (1) removal of amortization of transaction-related intangibles, (2) removal of certain expenses reimbursed by the Blackstone Funds, which are presented gross under GAAP but netted against Management and Advisory Fees, Net in the Total Segment measures, and (3) a reduction equal to an administrative fee collected on a quarterly basis from certain holders of Blackstone Holdings Partnership Units which is accounted for as a capital contribution under GAAP, but is reflected as a reduction of Other Operating Expenses in Blackstone’s segment presentation.
---	---
(d)	Fee related performance compensation may include equity-based compensation based on fee related performance revenues.
---	---
(e)	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 <br>non-controlling<br> interests.
---	---

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Blackstone Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(All Dollars are in Thousands, Except Share and Per Share Data, Except Where Noted)

19.	Subsequent Events

There have been no events since June 30, 2022 that require recognition or disclosure in the Condensed Consolidated Financial Statements.

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Item 1A. Unaudited Supplemental Presentation of Statements of Financial Condition

Blackstone Inc.

Unaudited Consolidating Statements of Financial Condition

(Dollars in Thousands)

	June 30, 2022
	Consolidated			Consolidated
	Operating			Blackstone			Reclasses and
	Partnerships			Funds (a)			Eliminations			Consolidated
Assets
Cash and Cash Equivalents	$	4,183,380		$	—		$	—		$	4,183,380
Cash Held by Blackstone Funds and Other		—			129,276			—			129,276
Investments		24,528,575			3,764,850			(969,667	)		27,323,758
Accounts Receivable		684,412			89,725			—			774,137
Due from Affiliates		3,935,109			17,297			(60,448	)		3,891,958
Intangible Assets, Net		246,988			—			—			246,988
Goodwill		1,890,202			—			—			1,890,202
Other Assets		658,025			273			—			658,298
Right-of-Use<br> Assets		886,911			—			—			886,911
Deferred Tax Assets		1,646,400			—			—			1,646,400
Total Assets	$	38,660,002		$	4,001,421		$	(1,030,115	)	$	41,631,308
Liabilities and Equity
Loans Payable	$	9,365,274		$	—		$	—		$	9,365,274
Due to Affiliates		1,918,604			143,234			(60,447	)		2,001,391
Accrued Compensation and Benefits		6,765,492			—			—			6,765,492
Securities Sold, Not Yet Purchased		3,966			23,063			—			27,029
Repurchase Agreements		152,529			—			—			152,529
Operating Lease Liabilities		993,875			—			—			993,875
Accounts Payable, Accrued Expenses and Other Liabilities		969,264			22,356			—			991,620
Total Liabilities		20,169,004			188,653			(60,447	)		20,297,210
Redeemable <br>Non-Controlling<br> Interests in Consolidated Entities		2			1,275,489			—			1,275,491
Equity
Common Stock		7			—			—			7
Series I Preferred Stock		—			—			—			—
Series II Preferred Stock		—			—			—			—
Additional <br>Paid-in-Capital		5,870,285			944,340			(944,340	)		5,870,285
Retained Earnings		2,803,100			25,328			(25,328	)		2,803,100
Accumulated Other Comprehensive Loss		(33,117	)		(9,108	)		—			(42,225	)
Non-Controlling<br> Interests in Consolidated Entities		3,704,525			1,576,719			—			5,281,244
Non-Controlling<br> Interests in Blackstone Holdings		6,146,196			—			—			6,146,196
Total Equity		18,490,996			2,537,279			(969,668	)		20,058,607
Total Liabilities and Equity	$	38,660,002		$	4,001,421		$	(1,030,115	)	$	41,631,308

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Blackstone Inc.

Unaudited Consolidating Statements of Financial Condition - Continued

(Dollars in Thousands)

	December 31, 2021
	Consolidated			Consolidated
	Operating			Blackstone		Reclasses and
	Partnerships			Funds (a)		Eliminations			Consolidated
Assets
Cash and Cash Equivalents	$	2,119,738		$	—	$	—		$	2,119,738
Cash Held by Blackstone Funds and Other		—			79,994		—			79,994
Investments		27,041,225			2,018,829		(395,011	)		28,665,043
Accounts Receivable		571,936			64,680		—			636,616
Due from Affiliates		4,652,295			15,031		(10,459	)		4,656,867
Intangible Assets, Net		284,384			—		—			284,384
Goodwill		1,890,202			—		—			1,890,202
Other Assets		492,685			251		—			492,936
Right-of-Use<br> Assets		788,991			—		—			788,991
Deferred Tax Assets		1,581,637			—		—			1,581,637
Total Assets	$	39,423,093		$	2,178,785	$	(405,470	)	$	41,196,408
Liabilities and Equity
Loans Payable	$	7,748,062		$	101	$	—		$	7,748,163
Due to Affiliates		1,812,223			104,334		(10,459	)		1,906,098
Accrued Compensation and Benefits		7,905,070			—		—			7,905,070
Securities Sold, Not Yet Purchased		4,292			23,557		—			27,849
Repurchase Agreements		42,000			15,980		—			57,980
Operating Lease Liabilities		908,033			—		—			908,033
Accounts Payable, Accrued Expenses and Other Liabilities		926,749			10,420		—			937,169
Total Liabilities		19,346,429			154,392		(10,459	)		19,490,362
Redeemable <br>Non-Controlling<br> Interests in Consolidated Entities		22,002			46,026		—			68,028
Equity
Common Stock		7			—		—			7
Series I Preferred Stock		—			—		—			—
Series II Preferred Stock		—			—		—			—
Additional <br>Paid-in-Capital		5,794,727			349,822		(349,822	)		5,794,727
Retained Earnings		3,647,785			45,189		(45,189	)		3,647,785
Accumulated Other Comprehensive Loss		(19,626	)		—		—			(19,626	)
Non-Controlling<br> Interests in Consolidated Entities		4,017,297			1,583,356		—			5,600,653
Non-Controlling<br> Interests in Blackstone Holdings		6,614,472			—		—			6,614,472
Total Equity		20,054,662			1,978,367		(395,011	)		21,638,018
Total Liabilities and Equity	$	39,423,093		$	2,178,785	$	(405,470	)	$	41,196,408
(a)	The Consolidated Blackstone Funds consisted of the following:
---	---

Blackstone / GSO Global Dynamic Credit Feeder Fund (Cayman) LP

Blackstone / GSO Global Dynamic Credit Funding Designated Activity Company

Blackstone / GSO Global Dynamic Credit Master Fund

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Blackstone / GSO Global Dynamic Credit USD Feeder Fund (Ireland)

Blackstone Annex Onshore Fund L.P.

Blackstone Horizon Fund L.P.

Blackstone Real Estate Special Situations Holdings L.P.

Blackstone Strategic Alliance Fund L.P.

BTD CP Holdings LP

Blackstone Dislocation Fund L.P.*

BEPIF (Aggregator) SCSp*

BX Shipston SCSp*

Blackstone Private Equity Strategies Fund L.P.*

Blackstone Private Equity Strategies Fund SICAV*

Mezzanine side-by-side investment vehicles

Private equity side-by-side investment vehicles

Real estate side-by-side investment vehicles

Hedge Fund Solutions side-by-side investment vehicles.

*Consolidated as of June 30, 2022 only

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.

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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.

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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.

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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.

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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.”

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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.

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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

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.

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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.

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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 <br>side-by-side<br> and <br>co-investment<br> 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 <br>co-investments<br> 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,
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(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.
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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,
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(c)	the remaining invested capital or fair value of assets held in <br>co-investment<br> vehicles managed by us on which we receive fees,
(d)	the net asset value of our funds of hedge funds, hedge funds, BPP, certain <br>co-investments<br> 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,
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(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
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(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.
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Each of our segments may include certain Fee-Earning Assets Under Management on which we earn performance revenues but not management fees.

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.

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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.

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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					29	%	$	3,037,123		$	2,390,364				27	%
Incentive Fees		99,598			33,207					200	%		204,087			69,331				194	%
Investment Income (Loss)
Performance Allocations
Realized		2,453,769			808,620					203	%		4,220,155			1,342,987				214	%
Unrealized		(3,467,668	)		2,697,170			)		n/m			(2,174,618	)		5,161,667		)		n/m
Principal Investments
Realized		265,161			152,060					74	%		550,265			507,098				9	%
Unrealized		(500,490	)		328,835			)		n/m			(426,529	)		968,150		)		n/m
Total Investment Income (Loss)		(1,249,228	)		3,986,685			)		n/m			2,169,273			7,979,902		)		-73	%
Interest and Dividend Revenue		62,075			31,017					100	%		116,560			62,429				87	%
Other		155,588			27,896					458	%		228,457			88,200				159	%
Total Revenues		629,220			5,291,354			)		-88	%		5,755,500			10,590,226		)		-46	%
Expenses
Compensation and Benefits
Compensation		686,012			507,104					35	%		1,342,517			1,049,742				28	%
Incentive Fee Compensation		45,363			14,431					214	%		86,382			27,756				211	%
Performance Allocations Compensation
Realized		1,035,916			347,423					198	%		1,753,517			560,450				213	%
Unrealized		(1,386,543	)		1,150,219			)		n/m			(914,259	)		2,200,188		)		n/m
Total Compensation and Benefits		380,748			2,019,177			)		-81	%		2,268,157			3,838,136		)		-41	%
General, Administrative and Other		289,288			205,057					41	%		529,962			390,179				36	%
Interest Expense		69,642			44,322					57	%		136,389			89,305				53	%
Fund Expenses		4,435			3,774					18	%		6,627			6,157				8	%
Total Expenses		744,113			2,272,330			)		-67	%		2,941,135			4,323,777		)		-32	%
Other Income (Loss)
Change in Tax Receivable Agreement Liability		(13	)		(392	)				-97	%		748			2,518		)		-70	%
Net Gains (Losses) from Fund Investment Activities		(104,326	)		127,116			)		n/m			(53,450	)		247,469		)		n/m
Total Other Income (Loss)		(104,339	)		126,724			)		n/m			(52,702	)		249,987		)		n/m
Income (Loss) Before Provision for Taxes		(219,232	)		3,145,748			)		n/m			2,761,663			6,516,436		)		-58	%
Provision for Taxes		36,514			288,250			)		-87	%		519,795			287,803				81	%
Net Income (Loss)		(255,746	)		2,857,498			)		n/m			2,241,868			6,228,633		)		-64	%
Net Income Attributable to Redeemable <br>Non-Controlling<br> Interests in Consolidated Entities		25,875			637					n/m			30,927			1,266				n/m
Net Income (Loss) Attributable to <br>Non-Controlling<br> Interests in Consolidated Entities		(216,707	)		431,516			)		n/m			(332	)		818,366		)		n/m
Net Income (Loss) Attributable to <br>Non-Controlling<br> Interests in Blackstone Holdings		(35,521	)		1,116,193			)		n/m			1,023,792			2,351,977		)		-56	%
Net Income (Loss) Attributable to Blackstone Inc.	$	(29,393	)	$	1,309,152			)		n/m		$	1,187,481		$	3,057,024		)		-61	%

All values are in US Dollars.

n/m Not meaningful.

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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.

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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.

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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.

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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.

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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.

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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.

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	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<br> 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
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	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<br> 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	%

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	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
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	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	%

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(a)	Inflows include contributions, capital raised, other increases in available capital (recallable capital and increased <br>side-by-side<br> commitments), purchases, inter-segment allocations and acquisitions.
(b)	Outflows represent redemptions, client withdrawals and decreases in available capital (expired capital, expense drawdowns and decreased <br>side-by-side<br> commitments).
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(c)	Realizations represent realization proceeds from the disposition or other monetization of assets, current income or capital returned to investors from CLOs.
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(d)	Market activity includes realized and unrealized gains (losses) on portfolio investments and the impact of foreign exchange rate fluctuations.
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(e)	Total and <br>Fee-Earning<br> Assets Under Management are reported in the segment where the assets are managed.
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(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 <br>Fee-Earning<br> Assets Under Management in the reporting period.
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(g)	For the three months ended June 30, 2022, the impact to <br>Fee-Earning<br> 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.
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(h)	For the six months ended June 30, 2022, the impact to <br>Fee-Earning<br> 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.
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(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.
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(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.
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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 <br>co-investment,<br> $4.9 billion from BREDS and $868.6 million from BREP and <br>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.
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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 <br>co-investment<br> and $1.2 billion from BPP and <br>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 <br>co-investment,<br> 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 <br>co-investment,<br> partially offset by appreciation of $1.2 billion from Core+ real estate (which included $2.2 billion of foreign exchange depreciation).
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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 <br>co-investment,<br> $8.8 billion from BREP and <br>co-investment<br> 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,
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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 <br>co-investment<br> and $2.0 billion from BPP and <br>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 <br>co-investment<br> and $1.4 billion from BPP and <br>co-investment,<br> 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 <br>co-investment,<br> 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.
---	---

Table of Contents

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 <br>co-investment,<br> $9.6 billion from BPP and <br>co-investment,<br> $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 <br>Fee-Earning<br> 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, <br>Fee-Earning<br> 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 <br>co-investment,<br> $3.1 billion from BREIT, $1.3 billion from BPP and <br>co-investment<br> 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:

$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,

---

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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 <br>co-investment<br> 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 <br>co-investment<br> 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 <br>co-investment,<br> $19.2 billion from BREIT, $11.5 billion from BPP and <br>co-investment<br> 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.

Table of Contents

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 <br>co-investment,<br> $5.0 billion from BREIT, $2.1 billion from BPP and <br>co-investment<br> 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.
---	---

•	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 <br>co-investment<br> 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 <br>co-investment<br> 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.
---	---

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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 <br>fee-paying<br> <br>co-investments;<br> includes <br>fee-paying<br> 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.
---	---

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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 <br>co-investments,<br> as applicable.
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Table of Contents

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.

Table of Contents

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 <br>co-investment<br> 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.
---	---

Table of Contents

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 <br>co-investment<br> 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.

Table of Contents

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		Public			Value		Value		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)	€<br> 824,172	€<br> —	—	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	€<br> 30,205,211	€<br> 9,763,258	12,433,908	1.2x		—		29,200,109	2.4x	41,634,017	1.8x		17	%		13	%

All values are in US Dollars.

continued...

Table of Contents

			Unrealized Investments					Realized Investments		Total Investments
Fund (Investment Period	Committed	Available			%							Net IRRs (d)
Beginning Date / Ending Date) (a)	Capital	Capital (b)	Value		Public			Value		Value		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 <br>Co-Investment<br> (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	%

All values are in US Dollars.

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			Unrealized Investments					Realized Investments		Total Investments
Fund (Investment Period	Committed	Available			%							Net IRRs (d)
Beginning Date / Ending Date) (a)	Capital	Capital (b)	Value		Public			Value		Value		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 <br>Co-Investment<br> 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 <br>I-V<br> (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	%

All values are in US Dollars.

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			Unrealized Investments				Realized Investments		Total Investments
Fund (Investment Period	Committed	Available			%						Net IRRs (d)
Beginning Date / Ending Date) (a)	Capital	Capital (b)	Value		Public		Value		Value		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)	€<br> 1,964,689	€<br> 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)	€<br> 4,088,344	€<br> 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	%

All values are in US Dollars.

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Selected Perpetual Capital Strategies (k)

Fund (Inception Year) (a)	Investment<br>Strategy		Total<br><br><br>AUM
	(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 <br>side-by-side,<br> 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 <br>Co-Investment<br> represents <br>co-investment<br> capital raised for various BREP investments. The Net IRR reflected is calculated by aggregating each <br>co-investment’s<br> 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.
---	---

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(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 <br>co-investment<br> 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 <br>co-investment<br> 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.

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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					35	%	$	1,191,937		$	880,850					35	%
Transaction and Other Fees, Net		46,974			38,080					23	%		87,459			64,099					36	%
Management Fee Offsets		(689	)		(493	)		)		40	%		(1,649	)		(2,116	)				-22	%
Total Management Fees, Net		658,036			491,251					34	%		1,277,747			942,833					36	%
Fee Related Performance Revenues		265,507			33,776					686	%		757,024			189,168					300	%
Fee Related Compensation		(273,893	)		(121,957	)		)		125	%		(618,735	)		(310,449	)		)		99	%
Other Operating Expenses		(88,329	)		(54,760	)		)		61	%		(154,332	)		(99,122	)		)		56	%
Fee Related Earnings		561,321			348,310					61	%		1,261,704			722,430					75	%
Realized Performance Revenues		1,997,720			351,053					469	%		2,800,636			439,691					537	%
Realized Performance Compensation		(831,402	)		(154,928	)		)		437	%		(1,121,433	)		(177,690	)		)		531	%
Realized Principal Investment Income		29,116			28,129					4	%		83,091			128,949			)		-36	%
Net Realizations		1,195,434			224,254					433	%		1,762,294			390,950					351	%
Segment Distributable Earnings	$	1,756,755		$	572,564					207	%	$	3,023,998		$	1,113,380					172	%

All values are in US Dollars.

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

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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.

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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.

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

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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					19%	$	854,931		$	742,266					15%
Transaction, Advisory and Other Fees, Net		27,551			32,272			)		-15%		40,209			74,979			)		-46%
Management Fee Offsets		(23,157	)		(3,601	)		)		543%		(50,299	)		(17,520	)		)		187%
Total Management and Advisory Fees, Net		437,853			393,277					11%		844,841			799,725					6%
Fee Related Performance Revenues		-			-					n/a		(648	)		-			)		n/m
Fee Related Compensation		(152,622	)		(136,767	)		)		12%		(303,672	)		(277,364	)		)		9%
Other Operating Expenses		(83,233	)		(61,041	)		)		36%		(150,977	)		(112,096	)		)		35%
Fee Related Earnings		201,998			195,469					3%		389,544			410,265			)		-5%
Realized Performance Revenues		122,884			383,010			)		-68%		573,122			638,855			)		-10%
Realized Performance Compensation		(57,380	)		(159,375	)				-64%		(264,083	)		(270,584	)				-2%
Realized Principal Investment Income		8,904			27,796			)		-68%		74,342			143,199			)		-48%
Net Realizations		74,408			251,431			)		-70%		383,381			511,470			)		-25%
Segment Distributable Earnings	$	276,406		$	446,900			)		-38%	$	772,925		$	921,735			)		-16%

All values are in US Dollars.

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.

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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.

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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.

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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

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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 <br>Co-Investment<br> 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.
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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			)		-7%	$	290,123		$	305,777			)		-5%
Transaction and Other Fees, Net		3,450			1,558					121%		4,919			5,904			)		-17%
Management Fee Offsets		(40	)		(203	)				-80%		(109	)		(261	)				-58%
Total Management Fees, Net		148,487			156,599			)		-5%		294,933			311,420			)		-5%
Fee Related Compensation		(57,863	)		(38,638	)		)		50%		(105,098	)		(77,488	)		)		36%
Other Operating Expenses		(26,066	)		(21,873	)		)		19%		(49,250	)		(41,045	)		)		20%
Fee Related Earnings		64,558			96,088			)		-33%		140,585			192,887			)		-27%
Realized Performance Revenues		7,197			17,056			)		-58%		36,110			48,629			)		-26%
Realized Performance Compensation		(2,083	)		(5,626	)				-63%		(11,083	)		(12,534	)				-12%
Realized Principal Investment Income (Loss)		(1,530	)		2,125			)		n/m		13,371			37,675			)		-65%
Net Realizations		3,584			13,555			)		-74%		38,398			73,770			)		-48%
Segment Distributable Earnings	$	68,142		$	109,643			)		-38%	$	178,983		$	266,657			)		-33%

All values are in US Dollars.

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.

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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.

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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.”

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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<br><br><br>June 30,											Months Ended<br><br><br>June 30,												Periods Ended<br><br><br>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.

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Operating Metrics

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

	Invested Performance<br><br><br>Eligible Assets Under<br><br><br>Management				Estimated % Above<br>High Water Mark/<br>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.
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(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.
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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					84	%	$	599,034		$	328,448					82	%
Transaction and Other Fees, Net		7,117			6,215					15	%		16,514			11,783					40	%
Management Fee Offsets		(1,165	)		(1,137	)		)		2	%		(2,784	)		(3,262	)				-15	%
Total Management Fees, Net		312,541			171,615					82	%		612,764			336,969					82	%
Fee Related Performance Revenues		81,086			15,113					437	%		148,282			28,889					413	%
Fee Related Compensation		(137,035	)		(78,023	)		)		76	%		(264,379	)		(155,194	)		)		70	%
Other Operating Expenses		(63,882	)		(44,504	)		)		44	%		(121,049	)		(91,339	)		)		33	%
Fee Related Earnings		192,710			64,201					200	%		375,618			119,325					215	%
Realized Performance Revenues		78,973			41,819					89	%		109,716			67,086					64	%
Realized Performance Compensation		(36,109	)		(18,342	)		)		97	%		(49,495	)		(28,387	)		)		74	%
Realized Principal Investment Income		7,019			5,082					38	%		29,800			51,465			)		-42	%
Net Realizations		49,883			28,559					75	%		90,021			90,164			)		-
Segment Distributable Earnings	$	242,593		$	92,760					162	%	$	465,639		$	209,489					122	%

All values are in US Dollars.

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

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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.

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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.

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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

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

	Three Months Ended<br>June 30,												Six Months Ended<br>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.

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(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<br><br><br>Eligible Assets Under<br><br><br>Management				Estimated % Above<br>High Water Mark/<br>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.
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(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.
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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.

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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 <br>Non-Controlling<br> Interests in Blackstone Holdings		(35,521	)		1,116,193			1,023,792			2,351,977
Net Income (Loss) Attributable to <br>Non-Controlling<br> Interests in Consolidated Entities		(216,707	)		431,516			(332	)		818,366
Net Income Attributable to Redeemable <br>Non-Controlling<br> 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.
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(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 <br>non-controlling<br> interests.
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(d)	This adjustment removes Unrealized Performance Allocations.
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(e)	This adjustment removes Unrealized Performance Allocations Compensation.
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(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 <br>non-controlling<br> interests.
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	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.
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	Three Months Ended					Six Months Ended
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	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.
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(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.
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(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 <br>tax-related<br> 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.
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	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.
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(m)	This adjustment removes the total segment amount of Realized Performance Compensation.
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(n)	This adjustment removes the total segment amount of Realized Principal Investment Income.
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(o)	This adjustment adds back Interest Expense on a segment basis, excluding interest expense related to the Tax Receivable Agreement.
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(p)	This adjustment adds back Depreciation and Amortization on a segment basis.
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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.
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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.

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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.

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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

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					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		—		—

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					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.
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(b)	Represents capital commitments to a number of other funds in each respective segment.
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(c)	Real Estate and Private Equity include <br>co-investments,<br> as applicable.
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(d)	Represents loan origination commitments, revolver commitments and capital market commitments.
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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.”

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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.
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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.

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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 <br>Non-Controlling<br> 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.
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(b)	Represents the principal amount due on the senior notes we issued assuming no <br>pre-payments<br> are made and the notes are held until their final maturity. As of June 30, 2022, we had no outstanding borrowings under our revolver.
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(c)	Represents interest to be paid over the maturity of our senior notes which has been calculated assuming no <br>pre-payments<br> are made and debt is held until its final maturity date. These amounts include commitment fees for unutilized borrowings under our revolver.
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(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 <br>non-controlling<br> 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 <br>non-controlling<br> interest holders.
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(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.
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(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.
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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.

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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.

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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.

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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.

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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 <br>kick-out<br> 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.
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•	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.
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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
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•	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 <br>credit-focused<br> funds.
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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.

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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

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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.

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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.

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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.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Our predominant exposure to market risk is related to our role as general partner or investment adviser to the Blackstone Funds and the sensitivities to movements in the fair value of their investments, including the effect on management fees, performance revenues and investment income. There were no material changes in our market risks as of June 30, 2022 as compared to March 31, 2022 and December 31, 2021. For additional information, refer to our Quarterly Report on Form 10-Q for the quarter ended March 31, 2022 and our Annual Report on Form 10-K for the year ended December 31, 2021.

Item 4. Controls and Procedures

We maintain “disclosure controls and procedures,” as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), that are designed to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing disclosure controls and procedures, our management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible disclosure controls and procedures. The design of any disclosure controls and procedures also is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired objectives.

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Our management, including our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15 under the Exchange Act as of the end of the period covered by this report. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this report, our disclosure controls and procedures (as defined in Rule 13a-15(e) under the Exchange Act) are effective at the reasonable assurance level to accomplish their objectives of ensuring that information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

No change in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) occurred during our most recent quarter, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Part II. Other Information

Item 1. Legal Proceedings

We may from time to time be involved in litigation and claims incidental to the conduct of our business. Our businesses are also subject to extensive regulation, which may result in regulatory proceedings against us. See “Part I. Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021. We are not currently subject to any pending legal (including judicial, regulatory, administrative or arbitration) proceedings that we expect to have a material impact on our condensed consolidated financial statements. However, given the inherent unpredictability of these types of proceedings and the potentially large and/or indeterminate amounts that could be sought, an adverse outcome in certain matters could have a material effect on Blackstone’s financial results in any particular period. See “Part I. Item 1. Financial Statements — Notes to Condensed Consolidated Financial Statements — Note 17. Commitments and Contingencies — Contingencies — Litigation.”

Item 1A. Risk Factors

For a discussion of our potential risks and uncertainties, see the information under the heading “Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2021 and in our subsequently filed periodic reports as such factors may be updated from time to time, all of which are accessible on the Securities and Exchange Commission’s website at www.sec.gov.

See “Part I. Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations — Business Environment” in this report for a discussion of the conditions in the financial markets and economic conditions affecting our businesses. This discussion updates, and should be read together with, the risk factor entitled “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.” in our Annual Report on Form 10-K for the year ended December 31, 2021.

The risks described in our Annual Report on Form 10-K and in our subsequently filed periodic reports are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table sets forth information regarding repurchases of shares of our common stock during the three months ended June 30, 2022:

							Approximate Dollar
			Average		Total Number of Shares		Value of Shares that
	Total Number		Price Paid		Purchased as Part of		May Yet Be Purchased
	of Shares		per		Publicly Announced		Under the Program
Period	Purchased		Share		Plans or Programs (a)		(Dollars in Thousands) (a)
Apr. 1 - Apr. 30, 2022		132,141	$	107.25		132,141	$	1,485,828
May 1 - May 31, 2022		924,995	$	106.22		924,995	$	1,387,577
Jun. 1 - Jun. 30, 2022		792,864	$	104.56		792,864	$	1,304,674
		1,850,000				1,850,000
(a)	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 numbers 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. See “Part I. Item 1. Financial Statements – Notes to Condensed Consolidated Financial Statements – Note 14. Earnings Per Share and Stockholders’ Equity — Share Repurchase Program” and “Part I. Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources – Share Repurchase Program” for further information regarding this repurchase program.
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As permitted by our policies and procedures governing transactions in our securities by our directors, executive officers and other employees, from time to time some of these persons may establish plans or arrangements complying with Rule 10b5-1 under the Exchange Act, and similar plans and arrangements relating to our common stock and Blackstone Holdings Partnership Units.

Item 3. Defaults Upon Senior Securities

Not applicable.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

Election of Directors

On August 2, 2022, Blackstone Group Management L.L.C., by a written consent as the sole holder of our Series II preferred stock, elected Stephen A. Schwarzman, Jonathan D. Gray, Joseph P. Baratta, William G. Parrett, Kelly A. Ayotte, James W. Breyer, Reginald J. Brown, Sir John Antony Hood, Rochelle B. Lazarus, Jay O. Light, The Right Honorable Brian Mulroney and Ruth Porat as directors of Blackstone Inc. Each director was serving as a director of Blackstone Inc. at the time of election.

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Annual Meeting of Stockholders

We will hold our 2022 annual meeting of stockholders (the “Annual Meeting”) at 9:00 a.m., Eastern Time, on September 22, 2022. The Annual Meeting will be held in a virtual meeting format only. Stockholders of record at the close of business on August 19, 2022 (the “Record Date”) can attend the meeting at https://event.webcasts.com/starthere.jsp?ei=1556945&tp_key=87dc132bea. In order to access the Annual Meeting, please be prepared to confirm your ownership of common stock as of the Record Date. Please note that there will not be any matter for stockholders to vote on at the Annual Meeting, and, as such, no action is expected to be taken at the Annual Meeting. Please note that we are not planning on providing any update on our business during the Annual Meeting.

Item 6. Exhibits

Exhibit<br>Number	Exhibit Description
4.1	Twenty-Second Supplemental Indenture dated as of June 1, 2022 among Blackstone Holdings Finance Co. L.L.C., Blackstone Inc., Blackstone Holdings I L.P., Blackstone Holdings AI L.P., Blackstone Holdings II L.P., Blackstone Holdings III L.P., Blackstone Holdings IV L.P. and The Bank of New York Mellon, as trustee (incorporated herein by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K filed with the SEC on June 1, 2022).
4.2	Form of 3.500% Senior Note due 2034 (included in Exhibit 4.1 hereto).
10.1	Amended and Restated Credit Agreement dated as of June 3, 2022, among Blackstone Holdings Finance Co. L.L.C., as borrower, Blackstone Holdings AI L.P., Blackstone Holdings I L.P., Blackstone Holdings II L.P., Blackstone Holdings III L.P. and Blackstone Holdings IV L.P., as guarantors, Citibank, N.A., as administrative agent and the lenders party thereto (incorporated herein by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the SEC on June 8, 2022).
10.2*	Form of Aircraft Dry Lease Agreement between Hilltop Asset Holdings LLC and Blackstone Administrative Services Partnership L.P.
31.1*	Certification of the Chief Executive Officer pursuant to Rule 13a-14(a).
31.2*	Certification of the Chief Financial Officer pursuant to Rule 13a-14(a).
32.1*	Certification of the Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith).
32.2*	Certification of the Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith).
101.INS*	Inline XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH*	Inline XBRL Taxonomy Extension Schema Document.
101.CAL*	Inline XBRL Taxonomy Extension Calculation Linkbase Document.

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101.DEF*	Inline XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB*	Inline XBRL Taxonomy Extension Label Linkbase Document.
101.PRE*	Inline XBRL Taxonomy Extension Presentation Linkbase Document.
104.	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).
*	Filed herewith.
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The agreements and other documents filed as exhibits to this report are not intended to provide factual information or other disclosure other than with respect to the terms of the agreements or other documents themselves, and you should not rely on them for that purpose. In particular, any representations and warranties made by us in these agreements or other documents were made solely within the specific context of the relevant agreement or document and may not describe the actual state of affairs as of the date they were made or at any other time.

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Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Date: August 5, 2022

Blackstone Inc.
/s/ Michael S. Chae
Name:	Michael S. Chae
Title:	Chief Financial Officer
	(Principal Financial Officer and
	Authorized Signatory)

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EX-10.2

Exhibit 10.2

AIRCRAFT DRY LEASE AGREEMENT

THIS AIRCRAFT DRY LEASE AGREEMENT (this “Agreement”) is made and entered into effective as of (the “Effective Date”) between Hilltop Asset Holdings LLC, a Delaware limited liability company (“Lessor”) and Blackstone Administrative Services Partnership L.P., a Delaware limited partnership (“ Lessee”) (collectively the “Parties”).

W I T N E S S E T H:

WHEREAS, Lessor owns a Gulfstream Aerospace GV-SP (G550) aircraft, manufacturer’s serial number 5107 aircraft, bearing FAA Registration number N335LL (the Aircraft Registration No. will be changed to N550TB), as described more fully in Section 1.1 below; and

WHEREAS, Lessor desires to dry lease the Aircraft to Lessee from time to time on a non-exclusive periodic basis; and Lessee desires to dry lease the Aircraft from Lessor from time to time.

NOW, THEREFORE, in consideration of the promises and the mutual covenants and undertakings herein contained, the Parties hereto do hereby agree as follows:

ARTICLE 1: LEASE AND TERM

1.1. Lease. Lessor hereby agrees to dry lease to Lessee, from time to time, and Lessee hereby agrees to dry lease from Lessor, from time to time, one (1) Gulfstream model GV-SP (G-550) aircraft, manufacturer’s serial number 5107 aircraft, with FAA Registration number N335LL (the Aircraft Registration No. will be changed to N550TB) (the “Airframe”), equipped with two (2) Rolls-Royce Deutschland Ltd & Co KG model BR700-710C4-11 engines bearing manufacturer’s serial numbers 15315 and 15314 (the “Engines”), together with all components, accessions, systems, appliances, parts, instruments, accessories, furnishings, and any manufacturer’s or third-party warranties, any manufacturer service programs in connection with the Aircraft and other equipment installed thereon or attached thereto on the date hereof, all specified avionics, equipment, spare parts and loose equipment and all logs, weight and balance documents, wiring diagrams, manuals and other records and documentation pertaining to the operation and maintenance of such aircraft in Lessor’s possession or under its control (the foregoing, together with the Airframe and Engines, collectively, the “Aircraft”) to Lessee hereunder. Changes to the U.S. registration mark of the Aircraft shall have no effect on this Agreement.

1.2. Term and Rental Periods. The Term of this Agreement (“Term”) shall commence on the Effective Date and continue in effect for a period of one (1) year, unless terminated sooner pursuant to the express provisions herein contained. At the end of the first one (1) year period or any subsequent one (1) year period, this Agreement shall automatically be renewed for an additional one (1) year period. Each party shall have the right to terminate this Agreement without cause on thirty (30) days written notice to the other party. Lessee may dry lease the Aircraft pursuant to this Agreement for specific periods of time during the Term (“Rental Periods”). No Rental Period shall be for more than thirty (30) days.

ARTICLE 2: RENTAL AND EXPENSES

2.1. Rental Payment. Lessee agrees to pay to Lessor an hourly rental fee for occupied business flight hours at a rental rate of as set forth in Schedule 1 (prorated for fractions) of operation during each Rental Period (the “Rental Payment”). The hourly rental fee may be adjusted by mutual agreement during the Term based on fair market pricing. Such rental fees include delays, detours, cancellations caused by weather, routing, maintenance or other similar occurrences during each Rental Period, except that Lessor, at its sole discretion, may reduce the rental fees in the event of such occurrences. Lessee shall not be subject to any daily minimum Rental Payment on any day during the Rental Period.

2.2. Positioning, Repositioning. Lessor has incorporated the estimated cost of positioning/repositioning flights into the Rental Payment, and any positioning/repositioning flights will not be part of the Rental Period and will be invoiced to Lessor’s account, even if Lessee commences or ends its Rental Period at a point other than at Teterboro Airport (“Home Base”).

2.3. Lessee Reimbursement for Fuel and Incidental Charges. Lessee shall be responsible for fuel and incidental charges on occupied business flight hours during the Rental Period. Such Incidental Charges include but are not limited to hangaring and tie down charges away from the Home Base, landing fees, federal excise taxes, airport taxes or similar charges, customs, immigration and similar charges related to international flights; and any additional insurance premiums required for specific flights during the Rental Period. In the event any such charges are inadvertently made to Lessor by service providers, Lessee shall promptly reimburse Lessor for such costs. Lessor shall instruct service providers to invoice Lessee in the future.

2.4. Lessor Reimbursement for Certain Charges. Lessor has incorporated the cost for maintenance and repairs into the Rental Payment. In the event any charges for maintenance are paid directly by Lessee, Lessor shall promptly reimburse Lessee for such cost, or deduct as an offset against Rental Payments such costs.

2.5. Invoicing and Payment. Lessor will send Lessee invoices for such payments as are due under this Article for each Rental Period, using the form attached as Appendix A or other form at Lessor’s discretion. Lessee shall make payment by check or money order payable to “Hilltop Asset Holdings LLC” payable upon receipt, or shall wire transfer funds to the address specified on the invoice.

2.6. Calculation of Hours of Operation. For purposes of Rental Payments, hours of operation for each Rental Period shall be calculated (1) from the time the Aircraft takes off to the time it lands.

2.7. Taxes. All payments, including specifically Rental Payments made by Lessee hereunder, shall be made free and clear of, and without deduction for, any taxes, levies, imposts, duties, charges, fees, deductions, withholdings, restrictions or conditions now or hereafter imposed by any governmental or taxing authority. Taxes which the Lessee may incur while operating the Aircraft include, but are not limited to: fuel excise taxes, airport taxes, sales and use taxes, over flight fees or taxes, and customs duties, or other foreign taxes relating to international travel. Notwithstanding the foregoing, Lessee shall only be liable for taxes on lease payments actually

BLACKSTONE DRY LEASE - PAGE 2 OF 9

made and Lessor shall indemnify, defend, and hold harmless, Lessee from any taxes assessed on the value of the Aircraft or any acceleration of Rental Payments subject to Lessee’s obligation to pay such taxes to the extent of actual Rental Payments as and when such Rental Payments become due.

2.8. Procedure to Request Rental of Aircraft. Lessee shall make requests for rental of the Aircraft to Lessor either orally or in writing. Requests should be made as far in advance as possible before the intended commencement of the Rental Period.

2.9. Availability. Lessor is making the Aircraft available to Lessee for dry lease on an “as available” basis only, and makes no guarantee or warranty with regard to Aircraft availability. Lessor will, in good faith, attempt to make the Aircraft available when it is not otherwise being used by Lessor, another lessee, or is unavailable for maintenance or other reasons.

2.10. Non-availability or Delay Due to Unanticipated Causes. Lessor shall promptly notify Lessee in writing if the Aircraft cannot be delivered for a Rental Period due to an unanticipated delay, such as weather or mechanical related delays. Lessor shall not be responsible for any loss, injury, damage, delay, or cancellation, or any consequential or incidental damages or costs incurred by Lessee caused by such delay or cancellation.

ARTICLE 3: OPERATION OFAIRCRAFT BY LESSEE

3.1. Operational Control. During each Rental Period, Lessee is and shall be the sole operator of the Aircraft and has sole operational control of the Aircraft. During each Rental Period, Lessee is responsible for operating the Aircraft in accordance and compliance with all laws, ordinances and regulations relating to the possession, use, operation, or maintenance of the Aircraft, including, but not limited to, Part 91 of the Federal Aviation Regulations (“FAR”).

3.2. Selection of Flight Crew. Lessee shall select and hire its own flight crew provided that the pilots shall be professionally trained and qualified, shall be familiar with and licensed to operate the Aircraft, and shall have current medical certificates, and recurrent training.

3.3. Care and Use. Lessee shall use and operate the Aircraft in a careful and proper manner. Lessee shall operate the Aircraft in accordance with the flight manual and all manufacturer’s suggested operating procedures. Lessee shall not operate, use, or maintain the Aircraft in violation of any airworthiness certificate, license, or registration relating to the Aircraft, or contrary to any law or regulation.

3.4. Limits of Operations. Lessee expressly warrants and agrees that it shall not operate the Aircraft outside the geographic limits set forth in the Insurance Policies (defined below), or otherwise operate the Aircraft in a way that would violate or compromise the Insurance Policies. Lessee shall use the Aircraft only for and on account of its business, and will not use the Aircraft for the purpose of providing transportation of passengers or cargo in air commerce for compensation or hire (except in accordance with the provisions of FAR 91.501), or for any illegal purpose.

3.5. Documentation. Lessee shall complete required flight logs, maintenance logs, or other recording entries required by the FAR during any Rental Period.

BLACKSTONE DRY LEASE - PAGE 3 OF 9

3.6. Maintenance and Repair. Lessor, at its own cost and expense, will promptly repair or replace all parts, appliances, components, instruments, accessories, and furnishings that are installed in or attached to the Aircraft (herein called “Parts”) that may from time to time become worn out, lost, stolen, destroyed, seized, confiscated, damaged beyond repair, or permanently rendered unfit for use for any reason whatsoever during a Rental Period. Further, Lessor shall reimburse Lessee for any mechanics liens or other costs incurred by Lessee associated with non-routine repairs or maintenance made during a Rental Period, provided that: (1) such repairs shall be made by an FAA approved repair facility; and (2) Lessor shall approve in advance such repairs or maintenance. Lessee covenants to repair any damage beyond ordinary wear and tear caused by Lessee’s use of the Aircraft.

3.7. Right to Inspect. Lessor and its authorized representatives shall, at all reasonable times, have the right to enter the premises where the Aircraft may be located for the purpose of inspecting and examining the Aircraft, its condition, use and operation, and the books and records of Lessee relating thereto to ensure Lessee’s compliance with its obligations under this Lease. Notwithstanding the foregoing rights, Lessor has no duty to inspect and shall not incur any liability or obligation by reason of not making any such inspection.

ARTICLE 4: INSURANCE AND LIABILITY

4.1. Primary Liability and Property Damage Insurance. Lessor shall maintain in effect, at its own expense, third party Aircraft liability insurance, passenger legal liability insurance, and property damage liability insurance during the Term in such amounts as are customary for similarly situated aircraft. Each liability policy shall be primary without right of contribution from any other insurance that is carried by Lessee, and expressly shall provide that all the provisions thereof, except the limits of liability, shall operate in the same manner as if there were a separate policy covering each insured.

4.2. Insurance Against Physical Damage. Lessor shall maintain in effect, at its own expense, all-risk ground and flight Aircraft hull insurance covering the Aircraft. Any such insurance shall be during the Term for an amount customary for a similar aircraft.

4.3. Lessee As Named Insured. All insurance policies carried by Lessor in accordance with this Article (the “Insurance Policies”) shall name Lessee as a named insured.

4.4. Deductible. Any Insurance Policy carried by Lessor in accordance with this Article may be subject to a deductible amount which is customary under policies insuring similar aircraft similarly situated. Lessor warrants and agrees that in the event of an insurable claim, Lessor will bear the costs up to the deductible amount.

4.5. Additional Insurance for Lessee. Lessee may, at its discretion, obtain additional insurance covering its operation of the Aircraft.

4.6. Certificate of Insurance. Upon request, Lessor shall deliver to Lessee a certificate of insurance evidencing the insurance required to be maintained by Lessor under this Article.

BLACKSTONE DRY LEASE - PAGE 4 OF 9

4.7. Mutual Waiver of Liability Claims. Except as specifically set forth in this Agreement, Lessor and Lessee each hereby agree that each shall hold harmless the other Party, and the other Party’s respective officers, directors, agents, employees, servants, attorneys, insurers, coinsurers, reinsurers, indemnitors, parents, subsidiaries, affiliates, predecessors, successors, and assigns from and against any and all liabilities, obligations, losses, damages, penalties, claims, actions, suits, costs and expenses, including reasonable legal fees and expenses, of whatsoever kind and nature including, without limitation, personal injury or death (“Liabilities”), that could be asserted by that Party against the other Party directly or indirectly (including but not limited to claims raised against that Party by any third-party, employee, agent, or other person or entity not a party to the Agreement) arising out of the lease, sublease, possession, rental, use, condition, operation, transportation, return, storage or disposition of the Aircraft or any part thereof (including, without limitation, Liabilities in any way relating to or arising out of latent or other defects, whether or not discoverable by a Party or any other person, injury to persons or property, or strict liability in tort), provided, however, that neither Party shall be required to hold harmless the other Party for Liabilities resulting from the gross negligence or willful misconduct of the other Party.

ARTICLE 5: WARRANTIES AND DISCLAIMERS

5.1. Lessor’s Warranty. Lessor warrants that (1) the Aircraft shall be delivered to Lessee in airworthy condition; (2) the Aircraft is properly registered in accordance with U.S. law; and (3) Lessor is a citizen of the United States of America as set forth in 49 U.S.C. Section 40102(15) and the regulations thereunder.

5.2. Lessor’s Disclaimer of Warranties. EXCEPT AS SPECIFICALLY PROVIDED HEREIN, LESSOR NEITHER MAKES NOR SHALL BE DEEMED TO HAVE MADE AND HEREBY EXPRESSLY DISCLAIMS, AND LESSEE EXPRESSLY WAIVES ANY REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, AS TO THE VALUE, CONDITION, WORKMANSHIP, DESIGN, OPERATION, MERCHANTABILITY OR FITNESS FOR USE FOR A PARTICULAR PURPOSE OF THE AIRCRAFT, AS TO THE ABSENCE OF LATENT OR OTHER DEFECTS, WHETHER OR NOT DISCOVERABLE, AS TO THE ABSENCE OF ANY INFRINGEMENT OF ANY PATENT, TRADEMARK OR COPYRIGHT, AS TO THE ABSENCE OF OBLIGATIONS BASED ON STRICT LIABILITY IN TORT OR ANY OTHER REPRESENTATION OR WARRANTY WHATSOEVER, EXPRESS OR IMPLIED, WITH RESPECT TO THE AIRCRAFT OR ANY PART THEREOF.

5.3. Lessee’s Representation Regarding Selection. Lessee represents and warrants that: (1) it has selected the Aircraft based on its own judgment and disclaims any reliance upon statements or representations not part of this Agreement; and (2) that the Aircraft is of a size, design and capacity selected by Lessee and is suitable for Lessee’s intended use.

5.4. Lessee Warranty Regarding Operation. Lessee represents and warrants that it shall only operate the Aircraft under the terms, conditions, and restrictions, as set forth in this Agreement.

BLACKSTONE DRY LEASE - PAGE 5 OF 9

ARTICLE 6: MISCELLANEOUS

6.1. Title. Title to the Aircraft shall remain vested in Lessor during the Lease Term and the Aircraft shall be registered at the FAA in the name of Lessor. Lessee shall have no right, title or interest in or to the Aircraft except as expressly provided herein and shall take no action that would impair the continued registration of the Aircraft at the FAA in the name of Lessor. Lessee shall not file or record this Agreement with the FAA. Lessee shall do or cause to be done any and all acts and things which may be required to perfect and preserve the interest and title of Lessor to the Aircraft within any jurisdiction in which Lessee may operate the Aircraft, and Lessee shall also do or cause to be done any and all acts and things which may be required under the terms of any other agreement, treaty, convention, pact or by any practice, customs or understanding involving any country or state in which Lessee may operate, as may be necessary or helpful, or as Lessor may reasonably request, to perfect and preserve the rights of Lessor within the jurisdiction of any such country or state.

6.2. Liens. Except as provided herein, Lessee will not directly or indirectly create, incur, assume or suffer to exist any liens on or with respect to (1) the Aircraft or any part thereof; (2) Lessor’s title thereto; or (3) any interest of Lessor therein. Lessee will promptly, at its own expense, take such action as may be necessary to discharge any such lien. Lessee may incur the following liens: (i) the respective rights of Lessor and Lessee as herein provided; (ii) liens created by Lessor; (iii) liens for taxes either not yet due or being contested by Lessee in good faith; and (iv) inchoate materialmen’s, mechanics’, workmen’s, repairmen’s, employees’ or other like liens arising in the ordinary course of business of Lessee, or Parties acting on behalf of Lessee insofar as such actions relate to the Aircraft and are not inconsistent with this Agreement, not delinquent, and for the payment of which adequate reserves have been provided.

6.3. Defaults.

(a) Each of the following events shall constitute an “Event of Default” hereunder (whatever the reason for such event of default and whether it shall be voluntary or involuntary, or come about or be effected by operation of law, or be pursuant to or in compliance with any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body): (1) if Lessee shall fail to pay when due any sum under this Agreement and such failure shall continue for a period of three business days after oral, facsimile, electronic mail or written notice has been given by Lessor to Lessee; (2) if Lessee shall fail to perform any covenant or agreement contained herein, and such failure shall continue for a period of fifteen (15) calendar days after notice thereof shall have been given in writing; (3) if any representation or warranty made by Lessee in this Agreement or any agreement, document or certificate delivered by the Lessee in connection herewith is or shall become incorrect in any material respect; (4) if Lessee shall operate the Aircraft in violation of any applicable law, regulation, rule or order of any governmental authority having jurisdiction thereof or shall operate the Aircraft when the insurance required hereunder shall not be in effect; (5) if any proceedings shall be commenced under any bankruptcy, insolvency, reorganization, readjustment of debt, receivership or liquidation law or statute of any jurisdiction; or (6) if any such proceedings shall be instituted against either Party and shall not be withdrawn or terminated within thirty (30) calendar days after their commencement.

BLACKSTONE DRY LEASE - PAGE 6 OF 9

(b) Upon the occurrence of any Event of Default Lessor may, at its option, exercise any or all remedies available at law or in equity, including, without limitation, any or all of the following remedies, as Lessor in its sole discretion shall elect: (1) by notice in writing to terminate this Agreement immediately, whereupon all rights of the Lessee to the use or possession of the Aircraft or any part thereof shall absolutely cease and terminate but Lessee shall remain liable as hereinafter provided; and thereupon Lessee, if so requested by Lessor, shall at its expense promptly return the Aircraft and Aircraft Documentation as required by this Agreement or Lessor, at its option, may enter upon the premises where the Aircraft or Aircraft Documentation are located and take immediate possession of and remove the same by summary proceedings or otherwise. Lessee specifically authorizes Lessor’s entry upon any premises where the Aircraft or Aircraft Documentation may be located for the purpose of, and waives any cause of action it may have arising from, a peaceful retaking of the Aircraft or Aircraft Documentation; or (2) perform or cause to be performed any obligation, covenant or agreement of Lessee hereunder. Lessee agrees to pay all costs and expenses incurred by Lessor for such performance and acknowledges that such performance by Lessor shall not be deemed to cure said Event of Default.

(c) Lessee shall be liable for all costs, charges and expenses, including reasonable legal fees and disbursements, incurred by Lessor by reason of the occurrence of any Event of Default or the exercise of Lessor’s remedies with respect thereto. No remedy referred to herein is intended to be exclusive, but each shall be cumulative and in addition to any other remedy referred to above or otherwise available to Lessor at law or in equity. Lessor shall not be deemed to have waived any default, Event of Default or right hereunder unless the same is acknowledged in writing by duly authorized representative of Lessor. No waiver by Lessor of any default or Event of Default hereunder shall in any way be, or be construed to be, a waiver of any future or subsequent default or Event of Default. The failure or delay of Lessor in exercising any rights granted it hereunder upon any occurrence of any such right upon the continuation or recurrence of any such contingencies or similar contingencies, and any single or partial exercise of any particular right by Lessor shall not exhaust the same or constitute a waiver of any other right provided herein.

6.4 Successors and Assigns. This Agreement shall be binding upon Lessor, Lessee, and their respective successors and assigns, except that Lessee may not assign or transfer any of its rights hereunder except with the prior written consent of Lessor. Subject to the foregoing, this Lease shall inure to the benefit of Lessor and Lessee and their respective successors and assigns.

6.5. Notices. All notices and other communications under this Agreement shall be in writing and shall be given (and shall be deemed to have been duly given upon receipt or refusal to accept receipt) by delivery in person, by facsimile (with a simultaneous confirmation copy sent by first class mail properly addressed and postage prepaid), or electronic mail, or by a reputable overnight courier service, addressed as follows:

If to Lessor:	Hilltop Asset Holdings LLC<br> <br>345 Park Ave, 44^th^ Floor<br> <br>New York, NY 10154

BLACKSTONE DRY LEASE - PAGE 7 OF 9

With a copy to:	Crowell & Moring LLP<br> <br>1001 Pennsylvania<br>Ave. NW<br> <br>Washington, DC 20004<br> <br>Attn:
If to Lessee:	Blackstone Administrative Services Partnership L.P.<br><br><br>345 Park Avenue, 44^th^ Floor<br><br><br>New York, NY 10154<br> <br>Attn:

or at such other address as either Party may designate in writing. Any notice hereunder shall be effective upon delivery.

6.6. Entire Agreement. This Agreement constitutes the final, complete, and exclusive statement of the terms of the agreement between the Parties pertaining to the subject matter of this Agreement and supersede all prior and contemporaneous understandings, including any prior written agreements of the Parties pertaining to the matters hereof.

6.7. Severability. If any provision of this Agreement is found to be prohibited or unenforceable in any jurisdiction, such provision shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof. Any such prohibition or unenforceability in one jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. To the extent permitted by applicable law, each Party hereto hereby waives any provision of law that renders any provision hereof prohibited or unenforceable in any respect.

6.8. Amendments and Modifications. The terms of this Agreement shall not be waived, varied, contradicted, explained, amended or changed in any other manner except by an instrument in writing, executed by both Parties.

6.9. Choice of Law. This Agreement shall in all respects be governed by, and construed in accordance with, the laws of the State of New York (disregarding any Conflict of Laws rule which might result in the application of the laws of any other jurisdiction), including all matters of construction, validity, and performance.

6.10. Force Majeure. No Party shall be liable for any failure to perform its obligations in connection with any action described in this Agreement, if such failure results from any act of God, riot, war, civil unrest, flood, earthquake, or other cause beyond such Party’s reasonable control (including any mechanical, electronic, or communications failure, but excluding failure caused by a Party’s financial condition or negligence).

6.11. Execution. This Lease may be executed in counterparts, each of which when so executed shall be deemed to be an original, and such counterparts together shall constitute one and the same instrument. Signatures transmitted by facsimile, .pdf, or any other electronic means shall constitute original signatures.

BLACKSTONE DRY LEASE - PAGE 8 OF 9

ARTICLE 7: TRUTH IN LEASING

7.1. Representation Regarding Maintenance. DURING THE LAST TWELVE MONTHS THE AIRCRAFT HAS BEEN MAINTAINED AND INSPECTED UNDER FEDERAL AVIATION REGULATION PART 91 AND UNDER PART 135. LESSOR HEREBY CERTIFIES THAT THE AIRCRAFT COMPLIES WITH THE MAINTENANCE AND INSPECTION REQUIREMENTS CONTAINED IN THE ABOVE LISTED FEDERAL AVIATION REGULATION FOR LESSEE’S USE OF THE AIRCRAFT UNDER THIS LEASE.

7.2. Representation Regarding Operational Control. DURING THE DURATION OF ANY RENTAL PERIOD UNDER THIS LEASE THE LESSEE, 345 PARK AVENUE, 44TH FLOOR, NEW YORK, NY 10154, IS RESPONSIBLE FOR OPERATIONAL CONTROL OF THE AIRCRAFT UNDER THE LEASE. LESSEE HEREBY CERTIFIES THAT IT UNDERSTANDS ITS RESPONSIBILITIES FOR COMPLIANCE WITH THE FEDERAL AVIATION REGULATIONS APPLICABLE TO THE AIRCRAFT.

7.3. Information from FAA. LESSEE UNDERSTANDS THAT AN EXPLANATION OF FACTORS BEARING ON OPERATIONS CONTROL AND PERTINENT FEDERAL AVIATION REGULATIONS CAN BE OBTAINED FROM THE RESPONSIBLE FLIGHT STANDARDS OFFICE.

7.4. FAA Notification: in accordance with FAR 91.23. The Parties shall take the following actions upon execution of this Agreement: (1) a copy of this Agreement shall be placed aboard the Aircraft; (2) a copy of this agreement will be mailed to the FAA Aircraft Registration Branch, Attn: Technical Section, P.O. Box 25724, Oklahoma City, OK 73125, within 24 hours of execution; and (3) the responsible Flight Standards Office will be notified at least 48 hours prior to the first flight of any Aircraft under this Agreement of the registration number of the Aircraft, the location of the airport of departure, and the departure time.

(Signature page follows)

BLACKSTONE DRY LEASE - PAGE 9 OF 9

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed in their names and on their behalf by their duly authorized officers, effective as of the Effective Date.

Hilltop Asset Holdings LLC
As Lessor
By:
Name:
Title:
Blackstone Administrative Services Partnership L.P.
By: Blackstone Holdings I—SUB GP L.L.C., its general partner
As Lessee
By:
Name:
Title:

Signature Page

Aircraft Dry Lease Agreement

Blackstone – Hilltop Asset Holdings LLC

Schedule 1: Rent

Rental Payment: per occupied business flight hour

a. (per section 2.1)

APPENDIX A

Hilltop Asset Holdings LLC

INVOICE

To
	Date:
Payable: Payable upon receipt
---
Ref Contract: Aircraft Dry Lease Agreement between Hilltop<br>Asset Holdings LLC and<br> <br>Blackstone Administrative Services Partnership, L.P.<br>(“Lease”) dated
Rental Period: _________ to<br>________
Description
---
1. Rental Payment
rental fee ([ ] per<br>occupied business flight hour of operation)
2. Other Costs: (see paragraph 2.3 of Lease)
Description<br> Cost
3. Total Rent Due:
4. Sales Tax Due:
TOTAL THIS INVOICE

All values are in US Dollars.

BLACKSTONE DRY LEASE - PAGE 2 OF 9

EX-31.1

Exhibit 31.1

Chief Executive Officer Certification

I, Stephen A. Schwarzman, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q for the quarter ended<br>June 30, 2022 of Blackstone Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material<br>fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
---	---
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly<br>present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;
---	---
4.	The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure<br>controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:
---	---
a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed<br>under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being<br>prepared;
---	---
b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be<br>designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;<br>
---	---
c)	Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report<br>our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
---	---
d)	Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred<br>during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control<br>over financial reporting; and
---	---
5.	The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal<br>control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):
---	---
a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial<br>reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and
---	---
b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the<br>Registrant’s internal control over financial reporting.
---	---

Date: August 5, 2022

/s/ Stephen A. Schwarzman
Stephen A. Schwarzman
Chief Executive Officer

EX-31.2

Exhibit 31.2

Chief Financial Officer Certification

I, Michael S. Chae, certify that:

1.	I have reviewed this Quarterly Report on Form 10-Q for the quarter ended<br>June 30, 2022 of Blackstone Inc.;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material<br>fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
---	---
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly<br>present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this report;
---	---
4.	The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure<br>controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and have:
---	---
a)	Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed<br>under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being<br>prepared;
---	---
b)	Designed such internal control over financial reporting, or caused such internal control over financial reporting to be<br>designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;<br>
---	---
c)	Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this report<br>our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
---	---
d)	Disclosed in this report any change in the Registrant’s internal control over financial reporting that occurred<br>during the Registrant’s most recent fiscal quarter (the Registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control<br>over financial reporting; and
---	---
5.	The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal<br>control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors (or persons performing the equivalent functions):
---	---
a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial<br>reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and
---	---
b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in the<br>Registrant’s internal control over financial reporting.
---	---

Date: August 5, 2022

/s/ Michael S. Chae
Michael S. Chae
Chief Financial Officer

EX-32.1

Exhibit 32.1

Certification of the Chief Executive Officer

Pursuant to 18 U.S.C. Section 1350,

As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of Blackstone Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2022 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Stephen A. Schwarzman, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934;<br>and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results<br>of operations of the Company.
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Date: August 5, 2022

/s/ Stephen A. Schwarzman
Stephen A. Schwarzman
Chief Executive Officer
*	The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as<br>part of the Report or as a separate disclosure document.
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EX-32.2

Exhibit 32.2

Certification of the Chief Financial Officer

Pursuant to 18 U.S.C. Section 1350,

As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report of Blackstone Inc. (the “Company”) on Form 10-Q for the quarter ended June 30, 2022 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Michael S. Chae, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section § 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1)	The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934;<br>and
(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results<br>of operations of the Company.
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Date: August 5, 2022

/s/ Michael S. Chae
Michael S. Chae
Chief Financial Officer
*	The foregoing certification is being furnished solely pursuant to 18 U.S.C. Section 1350 and is not being filed as<br>part of the Report or as a separate disclosure document.
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