Laurence D. Fink
Chairman and Chief Executive Officer at BlackRock
Thank you, Martin. BlackRock's core business growth is the strongest we've seen in nearly three years, with a significant upward shift ever since our last earnings call in April. Second quarter core net inflows were approximately $150 billion, excluding lower fee episodic M&A and institutional index activities.
Our stock growers, areas like ETFs, models, Aladdin and private markets are powering steadily higher organic base fee growth. Organic base fee growth represented the best second quarter since 2021. 2024 has been our ETFs strongest start in the year on record with $150 billion of net inflows, and iShares' June flows were the strongest month in our history and for any other issuer.
We are executing on landmark mandates across our platform and on closing our planned acquisitions of GIP and Preqin. Client and stakeholder feedback on both GIP and Preqin has been increasingly enthusiastic. We are in a differentiated path to transform our capabilities and infrastructure, and to meet the growing need for private market technology, data and benchmarking. We believe this will deepen our relationships with our clients and deliver value to you, our shareholders.
Our growth in private markets provides a whole new engine for premium diversified organic growth and less beta-sensitive revenues, both of which should drive future earnings and multiple expansion. We have strong conviction we are on pace to reach our 5% organic base fee growth target. And the expected third quarter closing of GIP will add on to our organic base fee growth potential, doubling our private markets base fees and adding approximately $100 billion of AUM focused on infrastructure.
At BlackRock, we always intensely push ourselves to anticipate where markets are going, what clients will need and how we can deliver better outcomes in better ways to each and every client. We set the standard for buy side risk management technology by launching Aladdin on the desktops of investors over 20 years ago. We acquired BGI and iShares to redefine the whole portfolio investing by blending both active and indexing to build better outcome-oriented portfolios. iShares' AUM was about $300 billion when we announced our acquisition in 2009. Today, iShares is approaching $4 trillion of client money.
We recently celebrated the five year anniversary of the eFront acquisition, where ACV has now more than doubled since becoming part of BlackRock. We have never been shy about taking big, bold strategic moves to transform ourselves and, most importantly, to transform our industry. Our successful business transformations are delivering our strong performance today and opening up meaningful new growth markets for our clients and for our shareholders.
We continue on our mission to transform private markets. BlackRock is unique in delivering an integrated approach to help our clients across all aspects of private market investing, enabling a seamless view into investment management, into technology and data onto one single platform. With a strong common culture of serving clients with excellence together with GIP, we will deliver for our clients a holistic global infrastructure manager across equities, debt and solutions. We'll provide the full range of infrastructure sector exposures and we will offer an unique origination across developed and emerging world markets.
Our recently announced agreement to acquire Preqin is another step in the transformation of our private markets and technology platform. As private markets grow, data and analytics will become increasingly more important. We believe our planned acquisition of Preqin will help to compete the whole portfolio by delivering high quality data, integrated with workflows. Ultimately, this should drive increased accessibility and efficiencies in private markets. And the combination of Preqin with Aladdin and eFront presents an opportunity to find a common language for private markets, powering the next generation of full portfolios.
We envision we could bring the principles of indexing to the private markets through standardization of data, through benchmarking and through better performance tools. BlackRock has developed a broad network of global corporate relationships through our many years of long-term investments in both their debt and equity. For companies where we're investors, they appreciate that we are a long-term, consistent, always their capital. We're not transactional. We invest early and we stay invested through cycles, whether it's debt or equity, pre-IPO, post-IPOs, companies recognize the uniqueness of our global relationship, our brand and our expertise across markets and industries. This makes us a valuable partner and in turn unlocks the opportunity and performance we could provide for clients.
Unique deal flow and track record of successful exits create a flywheel effect, enabling future fundraising and more scaled funds. Corporates and clients increasingly want to work with BlackRock, and we are executing on the best opportunity sets we've seen in years across iShares, private markets, whole portfolio solutions and Aladdin.
Importantly, our business has great breadth with organic growth diversified across our platform. In the first half of 2024, flows were positive in active and index and across all asset classes. Our active platform, including alternatives, contributed $11 billion. ETF remains a secular growth driver, crossing $150 billion of net inflows and already representing more than 70% of our total flows of last year. And our technology services revenue grew double-digit in the first half of the year.
Importantly, we have notified fundings for a number of scaled institutional wealth management that we expect to fund over the coming quarters. For example, in the second quarter, we were selected to manage a $10 billion U.S. corporate plan, a multi-billion fixed income portfolio for a large defined benefit scheme and scientific active equity strategies for several global financial clients. These add to the global mandates which we've seen that we've been chosen over the last six months, including a large U.S. RIA, a U.K. pension fund, a European captive asset management are just a few examples.
As we look to onboard these mandates and more in future quarters, and delivering the outcomes of our clients and their constituents and what they need. Growing business momentum across our scaled asset management and technology platform is driving strong financial results. BlackRock's operating income was up 12% year-over-year for 160 basis points of margin expansion. Earnings per share was up 12%, and we remain committed to delivering differentiated organic growth and a premium margin to our investors. We continue to generate leading organic growth and our operating margin of 44.1% is over 10 points above the traditional peer average.
Principal saved 5% yields in cash have kept many investors overweight in cash and nearly $9 trillion still sits in money market funds. Those weighting in cash would have missed out on a broad stock market returns of over 26% over the last year, including 17% so far in 2024. Long-term outcomes and future liability matching needs more than a 5% return. Investors will have to re-risk, which should improve flows into equities and credit markets. BlackRock is always a share winner when assets are in motion and a meaningful outperformer in periods of investors re-risking.
BlackRock operates from a position of strength. We have a clear path to our 5% organic base fee good target, and we're transforming ourselves to build a firm that can exceed that target. Clients increasingly see the value in the BlackRock model, a single unified platform designed for clients, unmatched in breadth, powered by BlackRock, and totally built on trust. And it goes beyond clients simply wanting to do more with BlackRock, they're looking for a partner that innovates and helps them grow.
The world's largest asset owners want deep strategic partnerships, increased customization and innovation. Approaching that might include a creative co-investment opportunities and co-development of strategies. BlackRock's decarbonization partners joint venture with Temasek is one example of this type of relationship. In the second quarter, we announced that its inaugural fund and a final close above its fundraising target raising $1.4 billion. The first time fund attracted over 30 institutional clients representing 18 countries. The diversity and depth of the investor base is a testament to our long-standing client relationships and the strength of our team.
Insurers represent some of our most long-standing relationships and clients, and we're leveraging our insurance expertise and diversified global platform to deliver fixed income technology and increasingly private market solutions. BlackRock manages nearly $700 trillion [Phonetic] in long-term AUM for insurance clients, and we are an industry leader in managing core fixed income for insurance companies general accounts. Insurance CIOs are expanding their mandate with BlackRock to include private markets and structured assets.
Just a few weeks ago, we were awarded our first large-scale general account allocation for a private structured credit mandate. We also had success with insurers and dedicated SMAs for infrastructure debt, where we have differentiated capabilities. We have deep, longstanding relationships across our insurance client channel with a dedicated insurance portfolio management team. We see significant opportunity to work more closely with our insurance clients and to leverage our GA business as a potential durable source of long-term capital for our private debt franchises.
The industrial logic that informed our planned acquisition of GIP has only begun even clearer in the last six months. There is a generational demand for capital and infrastructure, including the finance data centers for AI and for energy transition. Private capital will be critical in meeting these infrastructure needs, both stand-alone and through public-private partnerships.
Clients' reception to GIP has been overwhelmingly positive with strong reverse inquiry from clients excited to partner with a newly scaled infrastructure platform. We see particularly strong demand for opportunities in the AI, data centers and energy transition spaces.
Through BlackRock's relationships with corporates and sovereigns, BlackRock is at the center of the investment opportunity being shaped by the demand for generative AI. AI cannot truly happen without investments in infrastructure. These technologies require a new generation of upgrade data centers, which will need enormous amounts of energy to power them. With the AI-fueled need to build data centers, we see great potential to monetize the 4.3 gigawatts of power production capacity of generational assets currently owned by BlackRock's infrastructure funds.
When we talk to leaders in industry and governments, they express their desire to build out data centers, AI technology at the same time to decarbonize. Our diversified infrastructure fund recently invested in Mainova WebHouse, a first-of-its-kind partnership, to invest in a hyperscale data center platform in Frankfurt run entirely on renewable energy. And our planned acquisition of GIP will add a number of global data centers assets in our portfolio. We plan to be a leader in this space, leveraging our expertise to drive capital formation and unique deal flow to generate return for our clients.
For decades now, BlackRock has helped investors benefit from the growth of the capital markets, supporting their path to financial security and long-term objectives like retirement. Early in the second quarter, we successfully launched LifePath Paycheck with a subset of committed clients. We expect additional commitment plan sponsors to fund over future quarters, and we have a very strong late-stage pipeline.
More than half of the assets we manage are related to retirement. Our growth investments to enhance our capabilities and strategy like active target date and infrastructure underpin our commitment to improving retirement outcomes. BlackRock continues to create more access and connection between long-term investors and capital markets, both in the United States and throughout the world. Earlier this quarter, we announced an agreement with the Public Investment Fund, the PIF, to launch an investment management platform in Riyadh, which aims to accelerate the development of our local capital markets and enable foreign investments into the region.
We expanded our Jio BlackRock joint venture in India beyond asset management to brokerage and wealth management. And just last month, we joined a new coalition to mobilize infrastructure investments in the Indo-Pacific region alongside GIP and other global investors. In the U.S., we announced a new opportunity for BlackRock to help expand domestic capital markets by investing in the creation of the Texas Stock Exchange. The exchange aims to facilitate greater access and increased liquidity in the U.S. equity capital market for investors.
Our investment builds on a history of investing in similar market structure opportunities for the benefit of BlackRock clients. ETFs will continue to grow as a technology that provides simple, efficient access to capital markets, making investments easier for clients of all sizes. Our investments over time are driving accelerated momentum across our ETF platform. Second quarter ETF flows of $83 billion were positive across our core equity, strategic and precision categories. ETF flows of $150 billion in the first half of 2024, represents our best start to the year in iShares' history and are more than double what they were in the first half of last year.
BlackRock leads the ETF industry in flows and we are also facilitating market expansion. Our bitcoin ETF reached nearly $20 billion in its first six months and is the third highest gross exchange-traded product in the industry this year. Three of the five top asset-gathering bond ETFs are iShares, and our active ETFs are growing contributors with $12 billion of net inflows in 2024.
We remain focused on innovating our product offerings, particularly with active ETFs, growing bond ETFs with extending distribution partnerships to make iShares the provider of choice across all wealth platforms. In June, we expanded access to our alpha-seeking expertise through the launch of U.S. equities and high-yield ETF managed by some of our leading investors. And we're partnering with a number of international banks and brokerage platforms to expand distribution and access to our products. Examples include our relationships with ETF saving plan providers and a recent selection as a premier partner to invest that.
From winning our first client to serving millions of investors today, Aladdin has been the technological foundation for how we deliver our clients across our platform. Aladdin isn't just the key technology that power BlackRock, it also powers many of our clients. We see clients increasingly using the technology investments across the fintech and data ecosystems. We're partnering with clients who are increasingly looking for comprehensive technology solutions across their entire portfolio from risk analytics, investment management and to accounting capabilities.
The need for integrated investment in risk technology as well as whole portfolio views across public and private markets is driving durable ACV growth. Years ago, we anticipated that clients would benefit when alternative investments were evaluated inside a portfolio-level risk management framework. As allocation to private markets increased, we knew the ability to seamlessly manage portfolios and risk across public and private asset classes on a single platform would be critical. BlackRock invested ahead of these clients' needs, acquiring eFront in 2019 and going on to integrate it with Aladdin to deliver a whole portfolio view.
And our planned acquisition of Preqin will expand our capabilities beyond private markets, investment management and technology to data. We see a significant runway ahead as private market allocations from our clients will continue to grow alongside their need for an integrated, enterprise-level investment technology, data and analytics.
Much of BlackRock's success and our momentum today has come from anticipating and making calls on what our clients will need as they pursue long-term outcomes like retirement and financial security. We constantly innovate, we constantly evolve, we transform ourselves and we make sure we deliver for each and every one of our clients. We have spent decades building our global network of relationships, of data and analytics, integrating technology and these are the key differentiations to deepening our relationship with clients and accessing unique investment opportunities and partnerships.
With our planned acquisition of GIP and Preqin and core business strength, BlackRock's capability have never been stronger. We have the most comprehensive platform in the asset management industry integrating across public markets, private markets and our Aladdin technology. And we are creating a differentiating private markets approach. We're building what our clients need for success, a skilled private market platform encompassing investment, workflow through eFront and data and risk analytics through Preqin.
By bringing together investments, tech data across public and private markets, we have the opportunity to drive better portfolio outcomes for investors and open up a diversified higher multiple earnings streams for our shareholders' view. We look forward to delivering strong performance for our clients along differentiated growth, which will be an opportunity for you, our shareholders.
Operator, let's open it up for questions.
