Ares Management Corp.

ARES ·Financial, Asset Management, United States

Ares Management (ARES)

Overview

Ares Management Corporation is a global alternative asset manager — one of the largest "private capital" firms in the world, alongside names like Blackstone, Apollo, KKR, and Blue Owl. Founded in 1997 and headquartered in Los Angeles, California, Ares went public on the NYSE in 2014 and has grown explosively since, particularly in private credit. As of year-end 2025 the firm managed roughly $622.5 billion in assets under management (AUM), up from about $94 billion a decade earlier, employed more than 4,250 people across 55+ global offices, and generated about $5.6 billion in total revenue in fiscal 2025. Ares sits in the S&P 500 Financials sector (Asset Management / Capital Markets industry).

What They Do & How They Make Money

Ares doesn't take deposits or make loans on its own balance sheet in the way a bank does; instead it raises capital from institutional investors (pensions, sovereign wealth funds, insurers), high-net-worth individuals, and increasingly retail investors, pools that capital into investment funds and vehicles, and then invests it on their behalf across private credit, private equity, real estate, infrastructure, and secondaries markets. Ares earns money primarily through management fees charged on AUM (a steady, recurring revenue stream regardless of investment performance), plus performance fees/carried interest — a cut of investment profits once a fund clears a return hurdle. The largest and most important part of the business is direct lending and other forms of private credit: Ares originates loans directly to mid-market and large companies (often backing private-equity-owned businesses) that increasingly bypass traditional bank lending, collecting interest income and fees. It also manages publicly traded vehicles like Ares Capital Corporation (ARCC), the largest business development company (BDC) in the US, and Ares Commercial Real Estate Corp (ACRE). Because Ares is asset-light relative to a bank — it manages other people's capital rather than lending its own balance sheet at scale — its earnings scale with AUM growth and fundraising success rather than with net interest margin.

Business Segments

Per its most recent 10-K (fiscal year 2025), Ares organizes its business into four reporting segments by AUM:

Credit Group — By far the largest segment at roughly $406.9 billion of AUM (about two-thirds of firm AUM). Covers direct lending/private credit, syndicated/liquid credit, asset-backed and specialty finance credit, and alternative credit strategies. This is Ares' core growth engine and the source of most of its fee-related earnings.
Real Assets — About $139.1 billion of AUM, combining real estate equity/debt investing and infrastructure/power investing (essential assets like utilities, energy transition, and digital infrastructure).
Secondaries — About $42.1 billion of AUM, buying and restructuring existing stakes in private equity, credit, and real asset funds from other investors seeking liquidity (via its Landmark Partners platform).
Private Equity — About $25.3 billion of AUM, middle-market buyout and corporate private equity investing (including a European private equity platform).

Ares also runs a growing wealth-management/retail distribution channel and an insurance solutions business (managing roughly $25.9 billion for insurance company clients), both cutting across the segments above rather than standing as separate reporting lines.

Competitors

Direct lending / private credit: Blue Owl Capital, Blackstone Credit, Apollo Global Management (and its Athene insurance arm), Golub Capital, HPS Investment Partners (acquired by BlackRock), Oaktree Capital (Brookfield), Sixth Street.
Diversified alternative asset managers (broadest competitive set): Blackstone, Apollo Global Management, KKR, Carlyle Group, Brookfield Asset Management.
Real estate/infrastructure: Blackstone Real Estate, Brookfield Infrastructure, Starwood Capital.
Secondaries: Ardian, Lexington Partners (Franklin Templeton), Coller Capital, HarbourVest.
Business development companies (public vehicle competition for ARCC): FS KKR Capital, Blackstone Secured Lending, Owl Rock/Blue Owl-sponsored BDCs.

Competitive Position

Ares' central competitive advantage is scale and first-mover depth in direct lending: its Credit Group platform, anchored by Ares Capital Corporation, is among the largest and longest-track-record direct lenders in the market, giving it origination relationships, underwriting data, and deal flow that smaller entrants struggle to match. As banks have retreated from leveraged and middle-market lending under post-financial-crisis capital rules, Ares and its direct-lending peers have stepped into that gap, and Ares has been one of the biggest beneficiaries of that multi-year secular shift. Fee-related earnings — the recurring, less-cyclical part of its business — give the stock a more stable earnings profile than a traditional bank or a pure buyout shop, and the firm's push into retail/wealth channels and insurance-linked capital is expanding its addressable funding base beyond traditional institutional LPs.

Key risks and threats include credit quality: as a large private lender, Ares is exposed to defaults and markdowns if a slowing economy or higher-for-longer rates stress its borrowers' balance sheets, and the opacity of private credit valuations has drawn increasing scrutiny — Ares executives were among those questioned by Congress in 2026 over private credit market risks and transparency. The private credit space has also become intensely competitive and somewhat crowded, with banks themselves re-entering via partnerships (e.g., with asset managers) and rivals like Blue Owl, Blackstone, and Apollo/Athene all chasing the same insurance and retail capital pools, which could compress fees and lending spreads over time. Rising rates or a credit cycle downturn could also slow fundraising and deployment. Finally, as an asset manager whose earnings depend on AUM growth, Ares is sensitive to broader market sentiment toward alternatives and to any regulatory changes affecting fund structures, leverage, or retail access to private markets products (e.g., interval funds, evergreen vehicles).