Blackstone (BX) FY2025 10-K Risk Factors: 8 New, 12 Dropped

What the changes say

Blackstone added new disclosures covering geopolitical events, sustainability scrutiny, and climate-related regulations across its global portfolio.
The firm updated risk factors regarding real estate, infrastructure, and life sciences investments.

What changed since the prior 10-K

New

NewRisks Related to Our Business
valuations particularly sensitive to sharp changes in the price of any of these positions. Further, although the equity markets are not the only means by which we exit investments, periods of challenging equity markets make it more difficult for our funds to realize value from investments
Global equity and debt markets are vulnerable to geopolitical events, trade conflicts, tariffs, and lingering inflation that create uncertain economic conditions.
NewRisks Related to Our Business
We are subject to scrutiny from regulators, elected officials, stockholders, investors and other stakeholders with respect to sustainability matters, which may adversely impact our ability to raise capital from certain investors, constrain capital deployment opportunities for our funds and harm our reputation
Stakeholder scrutiny and conflicting demands regarding sustainability matters can restrict capital raising, limit deployment opportunities, and harm the firm's reputation.
NewRisks Related to Our Business
economy), and risks stemming from the physical impacts of climate change
New climate and sustainability regulations like the EU CSRD and SFDR impose enhanced disclosure obligations and significantly increase compliance costs.
NewRisks Related to Our Business
assets for certain insurance-dedicated funds and special purpose vehicles, and has developed, and may continue to develop, other capital-efficient products for insurance companies
The insurance platform depends on maintaining partnerships and originating high-performing products that meet policyholder obligations under heavy regulatory oversight.
NewRisks Related to Our Business
Certain of our investment funds may invest in securities of companies that are experiencing significant financial or business difficulties, including companies involved in bankruptcy or other reorganization and liquidation proceedings. Such investments are subject to a greater risk of poor performance or loss
Credit funds investing in troubled companies, bankruptcies, or high-risk receivables face high probabilities of poor performance or total loss.
NewRisks Related to Our Business
producing and will therefore be particularly exposed to a number of the risks outlined above
Real estate rent regulations and infrastructure rate limits can impair operating performance, restrict growth, and reduce asset profitability.
NewRisks Related to Our Business
s, the value of our fund’s investment would be adversely impacted
Life sciences investments under BXLS depend heavily on successfully defending patent rights and securing third-party reimbursement and coverage.
NewRisks Related to Our Business
Certain of the funds in which we invest are newly established without any operating history or are managed by less established management companies or general partners
Third-party hedge funds managed externally may use speculative strategies or leverage, exposing investments to potential counterparty losses without direct control.

Dropped

DroppedRisks Related to Our Business
A sustained high interest rate environment could increase the likelihood of an economic slowdown
DroppedRisks Related to Our Business
for certain transactions undertaken by our investment funds is expected to become more administratively burdensome and time consuming. Any potential time delay associated with obtaining approval may make it more difficult for our funds to deploy capital and exit and realize value from investments
DroppedRisks Related to Our Business
mark. The incentive income we earn is therefore dependent on the net asset value or the net profit of the vehicle, which could lead to significant volatility in our results
Sustained high interest rates and labor costs pressuring portfolio company profit margins.
DroppedRisks Related to Our Business
that will take effect in 2025. These amendments impose operationally challenging notification requirements and deadlines and obligations to implement written policies and procedures to govern oversight of service providers that will likely increase associated compliance costs
DroppedRisks Related to Our Business
Act, whistleblowers who voluntarily provide original information to the SEC can receive compensation and protection, including payment equal to between 10% and 30% of certain monetary sanctions imposed in a successful government action resulting from the information provided by the whistleblower
Administrative delays in transaction approvals and state restrictions on private fund investments.
DroppedRisks Related to Our Business
products for insurance companies
DroppedRisks Related to Our Business
Capital for Insurers Model Act promulgated by the NAIC, as adopted by applicable clients’ insurance regulators. Our Bermuda insurance company clients are subject to Bermuda Solvency Capital Requirements standards and other minimum capital and surplus requirements imposed by the Bermuda Monetary Authority
Volatility of carry funds and performance allocations dependent on realization timelines.
DroppedRisks Related to Our Business
investments and potentially decrease our net income.”
DroppedRisks Related to Our Business
Ownership of infrastructure assets may present risk of liability for personal and property injury or impose significant operating challenges and costs with respect to, for example, compliance with zoning, environmental or other applicable laws
DroppedRisks Related to Our Business
payers continue to pursue aggressive initiatives to contain costs and
DroppedRisks Related to Our Business
Our funds may be forced to dispose of investments at a disadvantageous time
DroppedRisks Related to Our Business
hedge funds that halted redemptions in the face of illiquidity and other issues, which precluded those funds of hedge funds from receiving their capital back on request

Reworded

100% rewrittenRisks Related to Our Business
Our funds’ investments in real estate and infrastructure assets, including digital infrastructure, may expose us to increased risks that are inherent in the ownership of such assets
Updated to explicitly include digital infrastructure and construction risks, alongside expanded liabilities for personal and property injury under zoning and environmental laws.
Was: Investments in energy, manufacturing, infrastructure, real estate and certain other assets may expose us to increased environmental liabilities that are inherent in the ownership of real assets
88% rewrittenRisks Related to Our Business
Our revenue, earnings, net income and cash flow can all vary materially due to our reliance on Performance Revenues, which may make it difficult for us to achieve steady earnings growth on a quarterly basis and may cause the price of our common stock to decline
Minor punctuation and phrasing adjustments made to the discussion on performance revenue volatility and common stock price fluctuations.
87% rewrittenRisks Related to Our Business
payments) are often contingent upon the achievement of certain milestones, including approvals of the applicable product candidate and/or product sales thresholds, over which BXLS may not have the ability to exercise meaningful control
Clarified that life sciences milestone payments depend on regulatory approvals and product sales thresholds over which BXLS lacks control.
84% rewrittenRisks Related to Our Business
or investment adviser from registration or memberships or the commencement of a civil or criminal lawsuit against us or our personnel
Revised introductory wording on financial services regulatory scrutiny and SEC examination priorities.
82% rewrittenRisks Related to Our Business
liability, increased costs, disruptions to business and operations, and reputational damage. Furthermore, any such inability or perceived inability of our funds’ portfolio companies, even if unfounded, could result in reputational damage to us
Added a specific reference to SEC regulations that took effect in 2025 regarding data security and privacy compliance.
80% rewrittenRisks Related to Our Business
A period of economic slowdown, which may occur across one or more industries, sectors or geographies, creates operating performance challenges for certain of our funds’ investments, which could adversely affect our operating results and cash flows
Adjusted phrasing on economic deceleration impacting energy, consumer investments, and real estate sectors like life science offices.
68% rewrittenRisks Related to Our Business
Risk management activities may adversely affect the return on our funds’ investments
Retained identical text regarding risk management and derivative strategies for market exposure.
67% rewrittenRisks Related to Our Business
Difficult market, economic 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
Retained identical text regarding global financial market and geopolitical conditions impacting revenue and cash flow.
63% rewrittenRisks Related to Our Common Stock
The price of our common stock may decline due to the large number of shares of common stock eligible for future sale and for exchange
62% rewrittenRisks Related to Our Organizational Structure
The Series II Preferred Stockholder may transfer its interest in the sole share of Series II preferred stock which could materially alter our operations
62% rewrittenRisks Related to Our Business
The due diligence process that we undertake in connection with investments by our funds may not reveal all facts and issues that may be relevant in connection with an investment
59% rewrittenRisks Related to Our Business
Financial regulatory changes in the United States could adversely affect our business
58% rewrittenRisks Related to Our Business
Dependence on significant leverage in investments by our funds could adversely affect our ability to achieve attractive rates of return on those investments
56% rewrittenRisks Related to Our Business
A decline in the pace or size of investments made by our funds may adversely affect our revenues
56% rewrittenRisks Related to Our Business
Trade negotiations and related government actions may create regulatory uncertainty for our funds’ portfolio companies and our investment strategies and adversely affect the profitability of our funds’ portfolio companies
51% rewrittenRisks Related to Our Business
Changes in U.S. and foreign taxation of businesses and other tax laws, regulations or treaties or an adverse interpretation of these items by tax authorities could adversely affect us, including by adversely impacting our effective tax rate and tax liability
51% rewrittenRisks Related to Our Business
Third-party investors in our investment funds with commitment-based structures may not satisfy their contractual obligation to fund capital calls when requested by us, which could adversely affect a fund’s operations and performance
50% rewrittenRisks Related to Our Business
Complex regulatory regimes and potential regulatory changes in jurisdictions outside the United States could adversely affect our business
45% rewrittenRisks Related to Our Business
regulators (including in Europe, Asia-Pacific, Bermuda and the Cayman Islands, among others) and the International Association of Insurance Supervisors, an international insurance standard-setting organization comprised of over 200 jurisdictions, have similarly focused on each of these topics
42% rewrittenRisks Related to Our Organizational Structure
If Blackstone Inc. were deemed an “investment company” under the 1940 Act, applicable restrictions could make it impractical for us to continue our business as contemplated and could have a material adverse effect on our business
41% rewrittenRisks Related to Our Business
intermediaries on whom we rely to distribute our investment products also sell their own competing proprietary investment products, which could limit the distribution of our products
37% rewrittenRisks Related to Our Business
feeder funds or nominee/omnibus investors) and market practices that vary by local jurisdiction. As a result, this expansion subjects us to additional complexity, litigation and regulatory risk
34% rewrittenRisks Related to Our Business
The potential for governmental policy and/or legislative changes and regulatory reform may create regulatory uncertainty for our investment strategies, may make it more difficult to operate our business, and may adversely affect the profitability of our funds’ portfolio companies
32% rewrittenRisks Related to Our Business
We and our affiliates have reported in the past and may be required to report in the future specified dealings or transactions involving Iran or other sanctioned individuals or entities
Was: We and our affiliates from time to time are required to report specified dealings or transactions involving Iran or other sanctioned individuals or entities
30% rewrittenRisks Related to Our Business
initiatives, including our development and use of AI Technologies, which subjects us to the risk of being accused of making inaccurate or misleading statements regarding our ability to avail ourselves of the potential benefits of AI Technology
29% rewrittenRisks Related to Our Business
Cybersecurity and data protection risks could result in the loss of data, interruptions in our business, and damage to our reputation, and subject us to regulatory actions, increased costs and financial losses, each of which could have a material adverse effect on our business and results of operations
28% rewrittenRisks Related to Our Organizational Structure
We intend to pay regular dividends to holders of our common stock, but our ability to do so may be limited by cash flow from operations and available liquidity, our holding company structure, applicable provisions of Delaware law and contractual restrictions
25% rewrittenRisks Related to Our Business
Our failure to deal appropriately with conflicts of interest in our asset management business could damage our reputation and adversely affect our businesses
Was: Our failure to deal appropriately with conflicts of interest in our investment business could damage our reputation and adversely affect our businesses
23% rewrittenRisks Related to Our Business
Our provision of products and services to insurance companies subjects us to a variety of risks and uncertainties
23% rewrittenRisks Related to Our Organizational Structure
Any amendments of our certificate of incorporation that are not included in the specified set of amendments that the Series II Preferred Stockholder has the sole right to vote on
21% rewrittenRisks Related to Our Organizational Structure
Other anti-takeover provisions in our charter documents could delay or prevent a change in control

All 78 risk factors

Headings as the filing states them, in filing order.

Risks Related to Our Business

01Difficult market, economic 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 condition67% rewritten
02valuations particularly sensitive to sharp changes in the price of any of these positions. Further, although the equity markets are not the only means by which we exit investments, periods of challenging equity markets make it more difficult for our funds to realize value from investmentsNew
03A period of economic slowdown, which may occur across one or more industries, sectors or geographies, creates operating performance challenges for certain of our funds’ investments, which could adversely affect our operating results and cash flows80% rewritten
04A decline in the pace or size of investments made by our funds may adversely affect our revenues56% rewritten
05Our revenue, earnings, net income and cash flow can all vary materially due to our reliance on Performance Revenues, which may make it difficult for us to achieve steady earnings growth on a quarterly basis and may cause the price of our common stock to decline88% rewritten
06vehicles. There can be no assurance that such alternatives will be as profitable for us as the traditional investment fund structure, or as to the impact such a trend could have on the cost of our operations or profitability if we were to implement these alternative investment structures
07The asset management business is intensely competitive
08other industry participants will from time to time seek to recruit our investment professionals and other employees away from us
09intermediaries on whom we rely to distribute our investment products also sell their own competing proprietary investment products, which could limit the distribution of our products41% rewritten
10We are increasingly undertaking business initiatives to increase the number and type of investment products we offer to individual investors, which could expose us to new and greater levels of risk
11feeder providers, and in other cases directly to the clients of private banks, independent investment advisors and brokers
12feeder funds or nominee/omnibus investors) and market practices that vary by local jurisdiction. As a result, this expansion subjects us to additional complexity, litigation and regulatory risk37% rewritten
13agreements except in limited circumstances has been introduced in New York
14Changes in U.S. and foreign taxation of businesses and other tax laws, regulations or treaties or an adverse interpretation of these items by tax authorities could adversely affect us, including by adversely impacting our effective tax rate and tax liability51% rewritten
15Cybersecurity and data protection risks could result in the loss of data, interruptions in our business, and damage to our reputation, and subject us to regulatory actions, increased costs and financial losses, each of which could have a material adverse effect on our business and results of operations29% rewritten
16Rapidly developing and changing global data security and privacy laws and regulations could increase compliance costs and subject us to enforcement risks and reputational damage
17liability, increased costs, disruptions to business and operations, and reputational damage. Furthermore, any such inability or perceived inability of our funds’ portfolio companies, even if unfounded, could result in reputational damage to us82% rewritten
18Technological developments in artificial intelligence could disrupt the markets in which we and our portfolio companies operate and subject us and our portfolio companies to increased competition, legal and regulatory risks and compliance costs
19initiatives, including our development and use of AI Technologies, which subjects us to the risk of being accused of making inaccurate or misleading statements regarding our ability to avail ourselves of the potential benefits of AI Technology30% rewritten
20or investment adviser from registration or memberships or the commencement of a civil or criminal lawsuit against us or our personnel84% rewritten
21We are subject to scrutiny from regulators, elected officials, stockholders, investors and other stakeholders with respect to sustainability matters, which may adversely impact our ability to raise capital from certain investors, constrain capital deployment opportunities for our funds and harm our reputationNew
22economy), and risks stemming from the physical impacts of climate changeNew
23initiatives, commitments and goals in our SEC filings or in other disclosures, which subjects us to additional risks, including the risk of being accused of greenwashing
24events and conditions to increase as well
25Financial regulatory changes in the United States could adversely affect our business59% rewritten
26The potential for governmental policy and/or legislative changes and regulatory reform may create regulatory uncertainty for our investment strategies, may make it more difficult to operate our business, and may adversely affect the profitability of our funds’ portfolio companies34% rewritten
27Trade negotiations and related government actions may create regulatory uncertainty for our funds’ portfolio companies and our investment strategies and adversely affect the profitability of our funds’ portfolio companies56% rewritten
28Our provision of products and services to insurance companies subjects us to a variety of risks and uncertainties23% rewritten
29assets for certain insurance-dedicated funds and special purpose vehicles, and has developed, and may continue to develop, other capital-efficient products for insurance companiesNew
30orders, fines, civil penalties, criminal penalties or other disciplinary action. To the extent we are involved in such regulatory actions, our reputation could be harmed, we may become liable for indemnification obligations and we could potentially be subject to enforcement actions, fines and penalties
31regulators (including in Europe, Asia-Pacific, Bermuda and the Cayman Islands, among others) and the International Association of Insurance Supervisors, an international insurance standard-setting organization comprised of over 200 jurisdictions, have similarly focused on each of these topics45% rewritten
32We rely on complex exemptions from statutes in conducting our asset management activities
33Complex regulatory regimes and potential regulatory changes in jurisdictions outside the United States could adversely affect our business50% rewritten
34Laws and regulations on foreign direct investment applicable to us and our funds’ portfolio companies, both within and outside the U.S., may make it more difficult for us to deploy capital in certain jurisdictions or to sell assets to certain buyers
35equivalents thereof may seek to impose limitations on one or more such investments that may prevent us from maintaining or pursuing investment opportunities that we otherwise would have maintained or pursued, which could make it more difficult for us to deploy capital in certain of our funds
36limited partners to participate in certain of our investment strategies
37We are subject to substantial risk of litigation and regulatory proceedings and may face significant liabilities and damage to our reputation as a result of allegations of improper conduct and negative publicity
38Poor performance of our investment funds would cause a decline in our revenue, income and cash flow, may obligate us to repay Performance Allocations previously paid to us, and could adversely affect our ability to raise capital for future investment funds
39Our equity investments and some of our debt investments rank junior to investments made by others, exposing us to a greater risk of losing our fund’s investment
40The historical returns attributable to our funds should not be considered as indicative of the future results of our funds or of our future results or of any returns expected on an investment in common stock
41the rates of return reflect our historical cost structure, which may vary in the future due to various factors enumerated elsewhere in this report and other factors beyond our control, including changes in laws
42Certain policies and procedures implemented to mitigate potential conflicts of interest and address certain regulatory requirements may reduce the synergies across our various businesses
43Our failure to deal appropriately with conflicts of interest in our asset management business could damage our reputation and adversely affect our businesses25% rewritten
44with such requirements or policies could harm our reputation with fund investors
45opportunities or fees and expenses
46Our use of borrowings to finance our business exposes us to risks
47Dependence on significant leverage in investments by our funds could adversely affect our ability to achieve attractive rates of return on those investments58% rewritten
48As a result, the risk of loss associated with a leveraged entity is generally greater than for companies with comparatively less debt
49and the timing and magnitude of such losses may be accelerated or exacerbated
50The due diligence process that we undertake in connection with investments by our funds may not reveal all facts and issues that may be relevant in connection with an investment62% rewritten
51We may be unable to consummate or successfully integrate development opportunities, acquisitions or joint ventures that we pursue
52We and our affiliates have reported in the past and may be required to report in the future specified dealings or transactions involving Iran or other sanctioned individuals or entities32% rewritten
53Our asset management activities involve investments in relatively illiquid assets, and we may fail to realize any profits from these activities for a considerable period of time
54We make investments in companies that are based outside of the United States, which may expose us to additional risks not typically associated with investing in companies that are based in the United States
55taxes or withholding on income and gains recognized with respect to such securities
56We may not have sufficient cash to pay back “clawback” obligations if and when they are triggered under the governing agreements with our investors
57Investors in a number of our vehicles may withdraw their investments, and investors in certain of our vehicles may have a right to terminate our management of, or cause the dissolution of, such vehicles, which would lead to a decrease in our revenues
58Third-party investors in our investment funds with commitment-based structures may not satisfy their contractual obligation to fund capital calls when requested by us, which could adversely affect a fund’s operations and performance51% rewritten
59Risk management activities may adversely affect the return on our funds’ investments68% rewritten
60Certain of our investment funds may invest in securities of companies that are experiencing significant financial or business difficulties, including companies involved in bankruptcy or other reorganization and liquidation proceedings. Such investments are subject to a greater risk of poor performance or lossNew
61energy investments made by our energy funds
62Our funds’ investments in real estate and infrastructure assets, including digital infrastructure, may expose us to increased risks that are inherent in the ownership of such assets100% rewritten
63producing and will therefore be particularly exposed to a number of the risks outlined aboveNew
64payments) are often contingent upon the achievement of certain milestones, including approvals of the applicable product candidate and/or product sales thresholds, over which BXLS may not have the ability to exercise meaningful control87% rewritten
65s, the value of our fund’s investment would be adversely impactedNew
66Certain of the funds in which we invest are newly established without any operating history or are managed by less established management companies or general partnersNew
67Underwriting activities by our capital markets services business expose us to risks

Risks Related to Our Organizational Structure

68Any amendment of our certificate of incorporation to elect to become a close corporation under Delaware law
69Any amendments of our certificate of incorporation that are not included in the specified set of amendments that the Series II Preferred Stockholder has the sole right to vote on23% rewritten
70We are a controlled company and as a result qualify for some exceptions from certain corporate governance and other requirements of the New York Stock Exchange
71Potential conflicts of interest may arise among the Series II Preferred Stockholder and the holders of our common stock
72judgment determining that the Series II Preferred Stockholder acted in bad faith or engaged in fraud or willful misconduct and we have also agreed to indemnify the Series II Preferred Stockholder to a similar extent
73The Series II Preferred Stockholder may transfer its interest in the sole share of Series II preferred stock which could materially alter our operations62% rewritten
74We intend to pay regular dividends to holders of our common stock, but our ability to do so may be limited by cash flow from operations and available liquidity, our holding company structure, applicable provisions of Delaware law and contractual restrictions28% rewritten
75If Blackstone Inc. were deemed an “investment company” under the 1940 Act, applicable restrictions could make it impractical for us to continue our business as contemplated and could have a material adverse effect on our business42% rewritten
76Other anti-takeover provisions in our charter documents could delay or prevent a change in control21% rewritten

Risks Related to Our Common Stock

77The price of our common stock may decline due to the large number of shares of common stock eligible for future sale and for exchange63% rewritten
78under the Securities Act to register common stock, among other securities, for future offerings. Accordingly, common stock registered under such registration statement will be available for sale in the open market

Other Blackstone 10-Ks

FY2024 10-K risk factors
82 risks
Blackstone faces intense market and economic volatility that can depress fund returns and performance revenues. Regulatory scrutiny spans the SEC, global data privacy, and foreign investment restrictions. Rapid growth in individual investor products and insurance asset management increases compliance and litigation risks. Technological disruptions and AI integration create new competitive and regulatory compliance costs.
Filed Feb 28, 2025

About this page

The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.