Oaktree Capital Group, LLC 6.625% PFD UT A

What they do

The company holds Credit, Real Estate and Equity investments managed by Oaktree Capital Management, L.P., including an approximately 74% economic interest in Oaktree Capital I, which holds a majority of Oaktree's fund investments. It also directly invests in Oaktree funds and, prior to April 20, 2026, held an indirect ownership interest in Brookfield REIT. The company is the issuer of Series A and Series B preferred units listed on the NYSE.

Revenue drivers

• Investment income from Oaktree funds — Income earned from investments in Oaktree's flagship opportunistic credit funds and other managed vehicles, driven by fund performance and realizations.
• Equity method investment in Oaktree Capital I — The company's 74% economic interest in Oaktree Capital I, which holds a majority of Oaktree's fund investments, contributes income based on the performance of those funds.
• Incentive income (indirect) — Prior to the 2024 Restructuring, revenue included incentive income from funds where Oaktree Capital I acted as general partner; now accounted for through the equity method investment.

Recent performance

Revenue for the quarter ended June 30, 2026 was $91.2 million, down from $160.4 million in the September 2025 quarter and $254.7 million in the December 2025 quarter. Full-year 2025 revenue was $679.5 million with net income of $249.2 million ($1.88 diluted EPS). Operating cash flow turned positive at $471.0 million in 2025 after several years of negative cash flow. Dividends per share were $2.10 in 2025, down from $2.84 in 2024.

Strategy

The company's structure has been streamlined through a series of restructurings, including the 2024 Restructuring that moved to accounting for Oaktree Capital I as an equity method investment. On April 20, 2026, the company distributed its 100% interest in OCG NTR Holdings, LLC to Brookfield Oaktree Holdings Canada Inc., eliminating its indirect ownership in Brookfield REIT. Management cites continued focus on Oaktree's opportunistic credit strategies and the pending acquisition by Brookfield of the remaining ~26% interest in Oaktree.

Risks

• Concentration in Oaktree funds — Results depend heavily on the performance of Oaktree-managed funds, particularly flagship opportunistic credit funds, which can be volatile.
• Market and economic conditions — Global financial market conditions, inflation, and geopolitical conflicts (e.g., Russia-Ukraine, Middle East) can adversely impact fund valuations and investment income.
• Oaktree's AUM management decisions — Oaktree may limit AUM, return capital, or alter fee terms, which could reduce revenues.
• Restructuring and ownership changes — Ongoing restructurings and the planned acquisition by Brookfield could affect the company's structure, cash flows, and preferred unit distributions.

Outlook

Management notes ongoing uncertainty from global conflicts and trade policy changes, though no material current impact is identified. The company expects its results to continue to be driven by Oaktree fund performance and distributions. The pending Brookfield acquisition of the remaining minority interest in Oaktree is subject to regulatory approvals and customary closing conditions.