Hello, everyone, and welcome to The Carlyle Group Fourth Quarter 2024 earnings. Please be advised that today's conference is being recorded. Now it's my pleasure to turn the call over to the Head of Investor Relations, Daniel Harris. Please proceed.

Thank you, Carmen. Good morning, and welcome to Carlyle's Fourth Quarter and Full Year 2024 Earnings Call. With me on the call this morning is our Chief Executive Officer, Harvey Schwartz, and our Chief Financial Officer and Head of Corporate Strategy, John Redett. Earlier this morning, we issued a press release and a detailed earnings presentation, which is available on our Investor Relations website. This call is being webcast, and a replay will be available. We will refer to certain non-GAAP financial measures during today's call. These measures should not be considered in isolation from or as a substitute for measures prepared in accordance with generally accepted accounting principles. We have provided a reconciliation of these measures to GAAP in our earnings release to the extent reasonably available. Any forward-looking statements made today do not guarantee future performance, and undue reliance should not be placed on them. These statements are based on current management expectations and involve inherent risks and uncertainties, including those identified in the Risk Factors section of our annual report on Form 10-K that could cause actual results to differ materially from those indicated. Carlyle assumes no obligation to update any forward-looking statements at any time. In order to ensure participation by all those on the line today, please limit yourself to one question and return to the queue for any additional follow-ups. With that, let me turn the call over to our Chief Executive Officer, Harvey Schwartz.

Thanks, Dan. Good morning, everyone, and thank you for joining us. We had a very strong 2024, and I'm pleased to say we delivered on each of our financial targets. Our record performance demonstrates our ability to mobilize across the firm and deliver long-term value. We generated over $1.1 billion of fee-related earnings, a nearly 30% increase over 2023. We expanded our FRE margin to 46%, a 900 basis point year-over-year increase, inflows exceeded $40 billion, bringing us to more than $100 billion of inflows over the last 2 years, and we returned more than $1 billion in capital to shareholders. As I mark my 2-year anniversary at Carlyle this week, I'd like to reflect on some of our key achievements. When I joined Carlyle, it was clear the firm had a proven investment track record, a leading global brand, and iconic name and financial history. However, there was certainly work to be done. Let me share some of the progress we made across our firm. We bolstered our leadership team through a combination of promotions from within and hiring external industry leaders. This group has quickly come together to mobilize our efforts around improving operations across the firm and delivering performance excellence. We overhauled our compensation strategy, which improved alignment across all our stakeholders. You, our shareholders, have more of what you value most: fees, and our investment team's compensation is now even more driven by performance. We implemented a new capital allocation strategy with a $1.4 billion share repurchase authorization reflecting our strong belief that the share price is significantly undervalued. Most importantly, we have both strong momentum in areas we strategically identified for growth over the last 2 years, like Global Credit and insurance, Global Investment Solutions, Global Wealth, and capital markets. Together, these businesses delivered 3-year revenue growth of approximately 40%. Now let me focus on our 2024 highlights. First, Global Credit has remained our fastest-growing area over the past 5 years, with revenues increasing 22% in 2024. This business has finished the year at $190 billion of assets under management. We closed our third opportunistic credit fund, which was 30% larger than the prior vintage. We also completed a landmark Discovery transaction, one of the largest asset-backed finance transactions of the year. At $25 trillion globally, asset-based and asset-backed finance is a massive addressable market, and we see significant opportunities to continue scaling this business. Moving on to capital markets, this business was clearly subscale when I arrived 2 years ago. We made a number of changes to drive value in this business. We appointed a new Global Head of Capital Markets and revised our incentive program. As a result, we had a record year in transaction fees. It's worth noting this record result was achieved in a market environment well below peak activity levels. New areas like asset-backed finance, infrastructure, and renewable energy are now all meaningful contributors. These areas accounted for nearly 40% of our capital markets revenue in 2024, up from single digits 2 years ago. In 2025, we expect continued growth in this area. Another priority has been broadening the scope of our Global Investment Solutions business. This year, solutions produced a 44% increase in fee revenue compared to the prior year. This platform has broadened its product set; new areas like CAPM, Global Wealth Evergreen Fund, and our portfolio finance strategy are adding to the platform scale. As an example of this growth, we closed a $1 billion collateralized fund obligation in the fourth quarter. There are 2 things to note here. One is that the design of this structure improved access to key AlpInvest funds for insurance clients. Two, this is the largest instrument of its kind ever raised. Of course, the core of this business continues to accelerate. We're finalizing fundraising for our eighth vintage secondary fund, which is already substantially larger than its predecessor. 2024 was also a notable year for our Global Wealth business. We saw record inflows of $4.5 billion, and we expect to build on that success in 2025. However, green wealth products saw a 65% step-up in AUM in 2024 to over $9 billion. There is strong demand across the globe for Carlyle solutions. We've added new distribution partners, and we expect our new private equity product to launch in the latter half of 2025. Now moving on to global private equity. I want to highlight the performance of our 2 latest U.S. buyout funds. Performance of these 2 funds appreciated 15% and 21%, respectively, in 2024. That is more than $5 billion of value creation—a fantastic year for these 2 funds. Activity levels accelerated across our U.S. buyout franchise over the past year. We took one of our companies public in one of the most successful IPOs of the year. We also invested capital into leading businesses like Vantiv, a $4 million carve-out of a global healthcare business, and WellPacked, a $2 million carve-out of a leading automotive equipment provider. We want to congratulate the team for driving value for all of our investors, these funds, our firm, and our shareholders. It's a great decision. Switching to real estate: our leading U.S. real estate franchise is finalizing its latest opportunistic fund. We expect this fund to close larger than its predecessor. AUM in this business has increased more than 80% over the past 4 years, and the team has done an extraordinary job navigating the real estate market—really impressive. Before I turn it over to John, let me share some thoughts on the broader macro environment. We have unique insights into the global economy through data from our investment portfolio, and the indicators remain positive around economic growth and employment. This reinforces our perspective that interest rates will stay higher for longer. This should spur new investment activity regardless of the amount of future monetary easing by the Fed and other major central banks. With respect to the new administration, our roots in Washington, D.C. are particularly helpful here. We have a long history of working through various cycles, administrations, and legislative priorities. We have mobilized the team as we evaluate changes in policy and regulatory action. The new administration promotes a pro-growth and pro-business agenda, supporting our portfolio and global economic activity. On tariffs, an area gaining a lot of attention, the situation remains fluid, but the majority of our portfolio is either domestically focused or more services-oriented versus goods, insulating it well from the impact of tariffs. Nearly 80% of our global private equity portfolio is U.S.-based, and although it is early days, we anticipate only a manageable impact across the portfolio, but we will continue to monitor closely. On regulation, we feel that the regulation will be an overall positive for all market participants and will again support business growth. In conclusion, we wrapped up a solid 2024, and we anticipate a strong year of investment activity, realizations, and fundraising in '25. John will provide specific insight on our 2025 outlook, but with all the work we've done to position Carlyle for continued long-term growth, we're confident we can build on our progress in the years ahead. With that, let me now turn the call over to John.

Thanks, Harvey. Good morning, everyone. Let's start with our results. We generated $1.5 billion in DE for the year or $3.66 in DE per share. Fee-related earnings of $287 million in the fourth quarter and $1.1 billion for the full year were both records. FRE increased nearly 30% in 2024, and our full year FRE margin of 46% increased nearly 900 basis points year-over-year. Clearly, we delivered on all of our 2024 financial targets. Notably, we achieved record FRE while also investing for growth in key areas across our platform. We increased the size of our global wealth distribution team by more than one-third this year, and the business itself grew assets under management by 65%. In our asset-backed finance business, our team grew by nearly 30%. We will continue to scale platforms where we see significant opportunity for growth. We had strong performance revenue, and transaction fees more than doubled to $164 million. As Harvey mentioned, our capital markets business remains an important growth driver for Carlyle. Our focus and investment in this area led to record levels of transaction fees in 2024, which we accomplished even as broader market activity levels remained well below those of prior years. While transaction fees may vary quarter-to-quarter, over time, we expect this earnings stream to continue to expand. We saw a nearly 40% increase in Global Investment Solutions management fees and a 9% increase in global credit management fees, while global private equity declined 7%. We expect continued growth in Global Credit and Global Investment Solutions in 2025 and a more modest decline in global private equity, which we expect to resume as we progress through our next U.S. buyout fund raise. We also enter with $23 billion in pending fee-earning AUM across our platform, up nearly 50% year-over-year. The management fee contribution from activating this pending AUM is close to $200 million annually. Our FRE cash compensation ratio improved to 36% in 2024, down from 45% in the prior year. This improvement was a direct result of our strategic compensation realignment that we implemented last year as well as the continued scaling of our platform. We are well on our way to achieving a compensation ratio of 35% or less. Activity levels increased across the platform with strong inflows of more than $14 billion in the fourth quarter and nearly $41 billion for the year. This was our third-best fundraising year ever. Deployment increased nearly 50% compared to 2023, with Global Credit, corporate private equity, and secondary strategies showing the most acceleration. With $84 billion in dry powder, we are well positioned for increased investment activity. In terms of exits, Corporate private equity realized proceeds nearly doubled from the prior year. We completed four portfolio company sales in the fourth quarter and sold nearly $2 billion in public securities, including proceeds from the IPOs of Standard Aero in the U.S. and Rigaku in Japan. Additionally, there are several exits in process. In U.S. buyout, our largest and most profitable fund strategy, we created meaningful value for LPs in 2024. We also distributed $5.3 billion in proceeds back to U.S. buyout investors throughout the year and generated nearly $600 million of net accrued performance revenues in our two most recent U.S. buyout funds. Moving on, let me turn to our 2025 outlook. We expect 2025 to be a year of growth and increased investment across our core businesses, including Global Wealth, Global Credit, and Solutions. We expect FRE to increase 6% compared to 2024. However, we do see the potential for upside driven both by opportunities and market conditions. We expect 2025 FRE margin to be at a similar level to that of 2024. We will update you as we progress throughout the year. We expect inflows in 2025 to be similar to 2024 levels. Credit is once again poised to raise the most capital across our platform, and we have a diversified fundraising pipeline across all segments. In closing, we entered 2025 with conviction in the direction of our overall platform. We will continue to invest in areas where we see the most opportunity to drive continued long-term shareholder value, and we remain focused on delivering great investment outcomes for our investors. Now let me turn the call back to the operator so we can take your questions.

And it from Alexander Blostein with Goldman Sachs.

Harvey, I appreciate the guidance and good color on how you guys are thinking about 2025. I was hoping you could elaborate a little bit. So I heard your comments on growth in Credit and Solutions, offset by a more modest decline in Global Private Equity. What are some of the bigger drivers in credit that you see for 2025 in solutions that will drive some of that growth? And as you think about the global private equity business, can you help us unpack perhaps the timing on when you expect to come back to market with the next selection plan?

Yes, Alex, it's John. Look, in terms of the 6% FRE growth, I would describe this as a base case for us. This is a number we have a high degree of confidence in. But I think importantly, it reflects us investing aggressively in businesses where we see growth, like Wealth, Credit, and Solutions. We're much more focused on delivering long-term growth and investing in the business to enable us to deliver that. We are far more focused on the growth aspect of our business than delivering short-term FRE. So you should understand that 6% in the context of us investing aggressively in businesses where we see growth. And what does that mean? You look at the headcount increase we had in Wealth last year—it was pretty significant. We think headcount will grow more than 50%. We're investing a lot of money in our asset-backed business, as we also did last year, and our Solutions business. We do see some upside to our 6% FRE. I think there are a lot of drivers of that, but I’ll just highlight a couple: wealth growth accelerates faster than we anticipate, capital markets fees could be a positive surprise, and I expect to see some favorable developments in insurance flows. There are more conversations going on in insurance now than I've seen since I've been CFO. So I do expect to see some positive insurance flows. In terms of credit specifically, we're continuing to see strong growth in our asset-backed business, as Harvey outlined in his prepared remarks. This is a massive market—$20-plus trillion. You'll see some growth in asset-backed. We raised a significantly larger third credit opportunistic fund; it's up materially from the predecessor. Our CLO business, while facing some headwinds in the front part of 2025, could be a positive surprise later in the year. The team had an outstanding 2024 with high activity after a couple of years of relatively limited activity. Another big driver within credit is CTech, which is our retail wealth product in Credit. So, I feel good about the trajectory of our credit business.

Is from the line of Stephen Shoback with Wolfe Research.

This is Brendan O'Brien filling in for Stephen. I guess I just want to talk about the you guys were obviously really aggressive in repurchasing shares this year. But when you announced the authorization, Harvey, you indicated that you would expect repurchases to accelerate alongside realization activity. Given your more optimistic outlook for realizations, it would be helpful to get an update as to how you're thinking about capital return and whether you would still expect to accelerate the buyback and how you're thinking about the balance versus investing in some of the growth opportunities John just discussed and returning capital to shareholders.

Yes. Last year, we announced a $1.4 billion share repurchase program. In 2024, we repurchased roughly 12 million shares, totaling $550 million. We have $850 million left on the authorization. We still view stock buybacks as a very attractive way to return capital to our shareholders, and you should assume we will be active in 2025. It's also important to note that for the first time in Carlyle's public history—roughly 12 years—we have actually shrunk our share count year-over-year in the last 2 years, which I think is a significant positive. We will continue to evaluate capital allocation across the spectrum. How do I think about capital allocation? I can buy back stock, invest in our businesses for growth, and consider M&A. I like returning capital to shareholders via buybacks. We will continue to do that, but we are also balancing that with aggression in investing to drive long-term growth. You should assume we still view our stock price as attractive and plan to repurchase stock.

Our next question is from Patrick Davitt with Autonomous Research.

Hey, good morning, everyone. The negative mark in fee-paying assets under management was kind of outsized relative to the reported positive 3% mark. So is that a reflection of a negative attitude mark in that? And if so, is there a potential for you to move off of a mark-to-market fee based model like some others have?

Yes. So let's look at fee-earning AUM and talk more about the fourth quarter versus the year. In the fourth quarter, you clearly had some realizations that decreased that number. However, realizations are good in our business in the sense we're returning capital to our LPs, which they like to see. You did see some realization activity, significantly more than last year. The fourth quarter had some noise; when I say noise, I mean really non-economic impact. What would that be? We had a $6 billion mark-to-market in credit market activity, which is really the result of movement in the 10-year yield at Fortitude. That really has no economic impact on the firm, so I would view that as noise. We also had $3 billion of excess FX movement in the quarter. So that's roughly $9 billion of really no financial impact to the firm. There’s a lot of noise in the quarter. Realization activities brought you down, but I think you should also focus on the $23 billion of pending fee-earning AUM we have, which is up 50% compared to the prior year. That will turn on throughout the year, generating roughly $200 million of annual run-rate revenue. Again, there's a lot of noise in the fourth quarter concerning fee-earning AUM.

One moment for our next question, and it comes from Brian Bedell with Deutsche Bank.

Great. Maybe just to talk about G&A expense a little bit. And maybe if you could just comment on the increase in the fourth quarter. And then thinking about the investments for 2025 across some of the businesses, could you comment on the 2 or 3 biggest areas that you cited, retail and the asset-backed business? How are you thinking about G&A expenses during the year? Are you still investing in the capital markets platform? Or do you see the incremental margins there, as the investment is mostly complete and the incremental margins, therefore, being much higher in capital markets?

It's John. Thanks for the question. I'll start with the G&A question. Overall, we're focused on running the firm efficiently, and I think it shows. G&A expense in 2020 was up 2%. G&A expense in 2024 was up 4%. So those are good numbers regarding running the firm efficiently. We expected fourth quarter G&A expense to be elevated. There is some seasonality in that elevation of G&A expense in the fourth quarter. If you look at our G&A numbers for the last 3 or 4 years, the fourth quarter is always a little elevated relative to the previous 3 quarters. But we also had some one-off items in the fourth quarter this year. We had fundraising expenses related to some direct lending money we raised and our Japan buyout fund raise, which was highly successful. I would not describe those as recurring. We also had some unfavorable FX impact, which that kind of moves up and down over time. So I don't look at the fourth quarter G&A expenses, and I don’t draw any operating trend conclusions from the elevated fourth quarter level. I think we've done a good job of kind of controlling G&A expense into the 2% to 4% range. Looking forward in terms of the FRE guidance we provided, I see Q1 being more similar to Q4 this year, and then I think throughout the year, you’ll see acceleration in FRE growth. As for how we’re investing, we clearly see a need to invest in wealth; that's largely headcount. That headcount will be up 50% at least in 2025. We're investing in credit because we see very strong growth. You look at our Solutions business: it grew organically over 40% this year, which will require some investment, which is great to see. In Japan, our Japan buyout had tremendous success raising money, and we need to invest some more there. I would describe our aggressive investing as focusing on growth businesses rather than making investments in areas where growth is less evident in the near term.

One moment for our next question. It comes from the line of Brian McKenna with Citizens JMP.

I had a question on the BDC merger. Can you remind us what the incremental fees are to CG post-merger and why those will turn on? This vehicle will have north of $2 billion of assets. So how should we think about the growth of the combined BDC and the broader direct lending platform moving forward?

Yes, we haven't disclosed the exact impact; however, it will be a positive impact on management fees and FRE. I wouldn't describe it as a material impact on our credit business, but it's positive. The BDC merger is set to close late in Q1 or early Q2; everything is on track there. In terms of direct lending, we had pretty good growth in 2024. That's an area where I didn't touch on in terms of where we're investing, but we are investing in our direct lending business. Performance has been strong, and we are making investments in that business as well. When you look at our direct lending business relative to some of our peers, we don’t have the same scale; thus, I see a significant upside ahead. There’s no reason why, with a brand like Carlyle, our direct lending business shouldn’t be significantly larger than it is today.

Our next question comes from the line of Glenn Schorr with Evercore ISI.

Two quick follow-ups to your earlier comments. I'm curious if you have dedicated strategies being formed yet in the asset-backed line, or is this effort mainly within your insurance SMEs and overall credit business? And on Investment Solutions, I think your performance has been great. How do you see the evolution and growth in perpetual products in that area and how that might impact growth and returns in the Solutions business going forward?

Glenn, on asset-backed finance, we highlighted it as a large addressable market, which is evolving due to the demand for capital from end users and the influx of insurance capital globally. It's hitting a sweet spot for us in terms of growth. A dedicated fund is being raised, but of course, we've built this off our affiliate partnership with Fortitude, which we’ve been doing for several years. As John mentioned, we invested heavily in that team last year and will continue to grow. Regarding the Solutions business, it's one of our fastest-growing areas, both institutionally and in wealth. You'll see us expand partnerships this year, some of which are significant, though I can’t provide specifics. We're optimistic about developments in that space. The performance and trend there are impressive.

One moment for our next question, and it comes from the line of Ben Budish with Barclays.

John, I was wondering if you could talk a little more about your compensation ratio expectations for the year. You said it would trend towards 35% or less. What are the other key factors that determine the timing? I imagine some of this is related to realizations, but what's embedded in your expectations for the 6% FRE guidance?

Yes, Ben. A large component of that is net realizations and net realized performance revenues. We had a really strong 2024 regarding realizations, and I think as some of these funds begin to realize carry, you’ll see acceleration in net realized performance revenues. This will benefit us positively. We provided that 30% to 35% range back in February 2023, and it will take a couple of years to reach that range. We reached a figure last year better than I anticipated—36%. I believe that 35% is imminently attainable, but we will get there naturally. We need net realized performance revenues to help along that journey, and we will be focusing on growth rather than expenses.

Our next question is from Dan Fannon with Jefferies.

So a couple of questions on Global Credit. I’m curious why the management fees declined sequentially in the fourth quarter, and given the large transaction fee, can you talk about the sustainability and outlook for transaction fees in that segment within Global Credit?

Yes. We actually attribute capital market transaction fees to the credit business as those fees are generated across the platform. Three years ago, this was a largely private equity-related earnings stream. Today, it's much more diversified across credit and infrastructure, in addition to corporate private equity, though we report that segment primarily within credit. Regarding the trajectory of credit, we feel confident. Every business in credit is growing, with the exception of our CLO business, which faced market headwinds in 2022 and 2023 but rebounded this year with activity. Management fees in that business were down an immaterial amount, but the rest of credit is growing, and we feel optimistic about the overall trajectory.

One moment for our next question, please. And it comes from the line of Bill Katz with TD Cowen.

John, sorry to go back to this, but I'm trying to unpack your comments about the fee-paying AUM dynamics in the quarter. You mentioned they should have no economic impact, but I'm trying to understand why the $6 billion decline will not affect economic impact looking ahead.

Yes. It will have a very minor economic impact in the sense that the way our agreement with Fortitude works is that we get paid based on the level of assets. The $6 billion mark-to-market situation led to an immaterial decline in those assets. The financial impact on 2025 will be a couple of million dollars, so really it’s largely immaterial.

Our next question comes from Ken Worthington with JPMorgan.

You have $500 million of net accrued carry in CP7. The fund is still hovering around an 8% IRR given the investments in the ground and some of the recent successful partial realizations. How confident are you that CP7 can remain above the hurdle rate and collect that accrued carry? Along the same lines, can you talk about how the marks and exits weighed on this quarter's results for CAP 5 and SEP 5?

Ken, it's John. I feel very good about the progress we're making in our U.S. private equity business. Harvey referenced the appreciation in our two most recent buyout funds as 15-20%. It was a great year for value creation, totaling around $5 billion. So we are moving in the right direction. Specifically regarding CP7, we're very pleased with its performance, which has improved dramatically over the past year. I believe that trajectory will continue, addressing our accrued carry. Carry calculations depend on overall fund performance and the amount of capital returned to LPs, but I am confident that fund will hit carry. The CAP business performed well; we saw good appreciation there. Most of the performance movement down came from our holdings in public equities, with volatility more pronounced in China, which drove some of the downward movements.

Our next question comes from the line of Michael Cyprus with Morgan Stanley.

I wanted to ask about global private equity. How do you expect the pace and magnitude of deployment and realization activity to evolve here in 2025 in the context of volatile markets, higher ten-year treasury yields over the last 6 months, and uncertainty around tariffs? How do you see these factors influencing getting deals done, and what is your outlook for the cadence of activity in the first half versus the second half of the year?

I would say we remain positive about activity. M&A volumes were up about 20% last year, and IPO volumes increased significantly. We capitalized on the openings in IPO markets with Standard Aero, which was a highly successful IPO for Rigaku in Japan. I see this as a positive sign. While base rates are indeed up compared to three years ago, spreads remain tight, resulting in attractive all-in financing costs. Debt markets are largely open, which is another positive. Additionally, strategic buyers have become active again, serving as another positive catalyst. Overall, we believe that the conditions for buying and selling assets favor a busy year on the realization front for 2025.

Our next question comes from the line of Kyle Voigt with KBW.

Just a follow-up on GPE. You mentioned continued declines in management fees until you raise your next U.S. buyout fund. Could you help clarify when you expect to begin fundraising for the next fund and indicate when we might see a potential activation, given the pace of deployment in CP8? I am assuming fundraising will occur in 2026, but perhaps you could narrow that down. Additionally, how should we think about the size of CP9 relative to CP8 at $14.8 billion, especially considering the private equity fundraising backdrop?

As I mentioned, Global Private Equity declined roughly 7% in 2024. We expect the rate of this decline to be significantly lower in 2025. We anticipate launching the U.S. buyout fund towards the end of 2025 and cannot comment on size yet, but we will be in the market in 2025. You will see fee activation sometime in 2026, which should help to improve our corporate private equity business trajectory.

One moment to your next question. It comes from the line of Mike Brown with Wells Fargo.

I wanted to unpack the targets a little more. John, you shared comments on credit and also Fortitude. The $40 billion or roughly flat year-over-year—does that assume any contribution from potential blocks that could come from Fortitude, or would that be in the upside bucket you referred to? Also, on management fees within your FRE guidance—could you comment on the positive tailwinds for transaction fees and how they factor into the overall management fee growth potential relative to the 6% FRE growth?

In terms of the Fortitude contribution, that is not included in our FRE 6% guidance. I would consider any inflows from Fortitude as additive to that growth rate. For management fee growth, I would break it down by looking at the three businesses. We anticipate very strong management fee growth within Solutions, which won’t sustain at the 45% level indefinitely. That was an exceptional year, but we expect ongoing strong growth. Credit also performed well, and we anticipate that to continue. The only segment experiencing headwinds is Corporate Private Equity, which was down 7% in 2024, and we believe that decline will be significantly less in 2025. We see a clear path to resuming positive trajectories as we begin fundraising for our U.S. buyout fund this year.

And our final question comes from Patrick Davitt with Autonomous Research.

Thanks for the follow-up. I assume the 6% FRE growth is partially informed by a view that there will be a meaningful increase in realizations in 2025. Could you provide any additional insights into how you consider that aspect within the FRE growth equation?

I would not characterize our forecast for the 6% FRE growth as hinging on significant increases in realization activity. We do expect realization activity levels to increase in 2025 relative to 2024, but I wouldn’t base our assumption for the 6% FRE growth on a substantial uptick in realizations.

Yes. Thank you for your time and interest in Carlyle today. Should you have any follow-up questions, please reach out to Investor Relations, and we look forward to speaking with you again next quarter.

And this concludes today's conference call. Thank you all for participating, and you may now disconnect.