EQT AB (publ) (EQT) Earnings Call Transcript & Summary

Welcome to EQT's half year report 2026. It's been a busy and successful first half for us, all in Fee paying AUM at EQT grew 10%. We delivered total revenue growth of 5% and 4% of EBITDA growth versus last year, with significant fundraising activities underway, driving growth into 2027. Before handing over to Per to kick things off, let me ask that we limit questions to 2 questions. in today's Q&A to make sure everyone has sufficient time to answer questions. So with that, let's hand it over to you, Per, to kick things off.

Thank you, Olof, and good morning, everyone. In a challenging and uncertain environment during the first half, we delivered strong performance and made significant progress across the board. We took advantage of a volatile market environment to unlock attractive investments. We were able to leverage our differentiated sourcing capabilities to really create very attractive deal flow for investors. We substantially increased our investment pace compared to last year. And in total, we put EUR 19 billion of capital to work and generated EUR 9 billion of co-investments. At the same time, we stayed disciplined on exits, building really on the record year of exits that we had in 2025 when we achieved EUR 40 billion of distributions. We sent back close to EUR 17 billion to our clients during the first half. The cross business lines, we launched a number of new strategies, and we currently have more than 20 active funds in the market. In private capital, we were selected for the scale of Europe Fund by the European Commission. This win is really a great testament of our market-leading position in Europe. and the quality of our early-stage platform. In Asia, we raised the largest Asia-focused private equity fund ever with BPA 9 hitting the hard cap at EUR 15.6 billion. For EQT 11, we're off to a very good start, and we have so far secured commitments of half of the target fund size. In private capital, we had strong deal flow across strategies. In total, we put EUR 5 billion of capital to work out of our funds, and we generated around EUR 5 billion in co-investments. A significant part of that co-invest came from the GBP 11 billion take-private of Intertek. Post Intertek and EQT X is now approximately 85% invested. In EQT equity, we continue to see strong and attractive deal flow ahead, and we expect to activate EQT 11 during the third quarter. The attractive near-term investment pipeline in EQT Equity is also likely to support and drive further fundraising momentum for EQT 11. This is something that we've seen in prior flagship fundraising, most recently in BPEA IX and Infra VI. Turning to our infrastructure business. Momentum across our infrastructure platform is really exceptional. The investment volumes for the first half of 2026 are higher than the 2 previous calendar years combined. Value creation has picked up significantly. Performance across funds is strong and the outlook remains favorable, not least for the AI infrastructure strategy and all of the connected investments that we have across our infrastructure platform. Both the AI infrastructure and the active core Infra strategies are off to a very strong start. We launched the EQT Infra VII fundraising with a EUR 21 billion target fund size, and the initial reception has been very positive and interest from clients is strong. In real estate, we also see excellent momentum. We closed the most recent Europe Logistics fund at the EUR 3.1 billion hard cap, and we launched the U.S. Industrial Value Fund VII targeting EUR 6 billion. We're really optimistic about the potential in this part of our business, and we'll come back to that shortly. Coller Capital remains on track for closing in the third quarter. adding secondaries capabilities to our platform will make us even better placed to be the most attractive counterparty in private markets for clients. It will also significantly strengthen our positioning in the insurance channel and in private wealth. Across our private wealth platform, we see strong momentum and in the quarter, included in Coller, our Evergreen offerings reached a new milestone of EUR 10 billion in NAV. Private wealth remains an important opportunity for us. We will approach this opportunity with a long-term and responsible mindset, and we continue to make the necessary investments into our client solutions capabilities, distribution partners as well as our brand. An important initiative in this regard was seen [indiscernible] during the quarter or for brand partnership in sports with the ATP Ten store. Next slide, please. In May, we announced the decision by the European Commission to select EQT to manage the scale of European. The decision was taken following a highly competitive process and is really the ultimate validation of what we've built over the last 30 years. As the overall European platform investing across ventures, growth and life sciences we are uniquely qualified for this mandate. The opportunity set is significant and very attractive. Over the last decade, an estimated EUR 1.2 trillion in market value has left due to Europe. Europe really doesn't have a startup problem. It has a scale-up challenge. We estimate that there is more than EUR 500 billion in scale of fund until 2031. Today, 60% of growth stage funding of European companies comes from outside of Europe. With the scale of Europe fund, we want to really rally the entire European early-stage ecosystem behind this opportunity. We want to leverage our scale, our operational toolbox, our global network to help European entrepreneurs and founders realize their full potential. We want them to go for gold and become global winners just like EQT has become a European headquartered global winner in the private markets. The focus for the fund will be AI, robotics, semiconductors, energy, biotech and advanced industrial systems. In one of these subsectors, we want to find and back Europe's first trillion-euro company. The fund is off to a great start. Deal flow is above our expectations and interest from investors is strong. We have more than 125 high-priority opportunities that we're currently pursuing, and we expect to announce several investments for this strategy already during the third quarter. We set the target fund size at EUR 5 billion. We see client demand above this level, and we have not set the hard cap for this fund yet. Next slide, please. During the second quarter, we officially launched the EQT AI infrastructure fund to offer investors direct exposure to the most compelling investment opportunity of our generation. The demand for AI compute is accelerating at a rapid pace, and we continue to see a huge supply-demand imbalance. Industry estimates suggest that by 2030, EUR 4 trillion will be invested into data centers and energy infrastructure. At EQT, across our infrastructure platform, we've invested in this team with high conviction for many years, starting with our investment in EdgeConneX in 2020. Since then, we've developed a differentiated strategy to connect our fiber, energy and data center assets and our real estate platform to provide integrated solutions for data center clients around the world. As a result, EQT is uniquely positioned to be a central partner in this build-out. Through EdgeConneX, we today operate more than 90 data centers globally across 5 continents in 26 countries. We've deployed 30 million miles of fiber network and our energy companies have a development pipeline exceeding 100 gigawatts. No other private markets firm can offer this type of integrated solutions to hyperscalers. The AI infrastructure fund provides a unique opportunity for private market investors to get exposure to this team. And that is what we're seeing reflected in the significant value creation and fundraising momentum for this fund. In less than 3 months, NAV increased from EUR 2.4 billion to EUR 9.4 billion. Next slide, please. Let me now turn to EQT Real Estate. It's been approximately 5 years since we acquired Exeter. During this time, the real estate market was really or has been out of favor and the fundraising environment has been challenging. In the key funds, EQT Real Estate delivered top quartile or better performance. And as a result, despite these challenging market conditions, we have doubled fee-generating AUM from approximately EUR 11 billion at the time of the acquisition to EUR 22 billion today. We want to build on this performance and momentum and think that now is an interesting time to accelerate growth. We see signs of the real estate market gradually improving and activity levels picking up. We recently announced the launch of the fundraising for the flagship U.S. Industrial Value Fund VII. And the EUR 6 billion target is a significant increase in fund size compared to Fund VI. The initial response from clients has been very positive. Looking ahead, we see an opportunity to expand into new thembatic verticals beyond our current industrial and logistics focus. Living, multifamily and data centers are near-term priorities and opportunities for us. Geographically, we're continuing to build our presence in the U.S. and Europe, and longer term, APAC is also an opportunity. The new segment reporting reflects the strategic importance and the growth opportunity that we see going forward for this part of our business. Next slide, please. At EQT, we continue to generate the most attractive deal flow and the most attractive co-investments in the private markets. Our ability to generate co-investments is a real differentiator for us and is the result of the deal sourcing machine that we've built over the last decades. Combining a strong local presence in our target geographies with a global sector-based thematic investment approach allows us to unlock deals and to engage with investors in a more long-term strategic way. Thematically, thanks to the breadth of our platform, we remain perfectly designed to invest into the AI opportunity. And that is what we see reflected in our deal flow and in our investment activity in the first half. Our infrastructure and private capital platforms are really firing on all cylinders. In infrastructure, we made several attractive investments in the energy sector. For instance, in AES and Copia Power. Copia Power will be the first deal in the newly announced infrastructure 7 fund. We also invested in physical infrastructure businesses that are providing critical nondiscretionary services, for instance, Galda and/or base. In EQT Private Capital, EQT 10 announced an offer for Intertek, 1 of the largest take privates in Europe so far this year and actually the second largest U.K. sponsor-backed public to private transaction of all time. EQT 10 also invested in Eco-Launch a European space company as well as Tal a globally leading niche med tech business. Post TachoSil, EQT 10 is now close to fully invested with an appropriate vintage sector and geographic diversification. In Asia, we continue to have an attractive pipeline, in particular in India and Japan. In Japan, over the past 12 months, we've done 3 public to privates, including Fujitec, Carnet and Lamesa. Finally, across the early stages platform, deal flow is at record levels, also fueled by the announcement of EQT being selected as the manager for the scale of Europe Fund. The momentum that we're seeing in this part of our business is really very exciting. Next slide, please. Our strategy of being the client-centric scale player focused on performance, that unique precision -- proposition that we can bring to the market of being the global provider of international alpha that really resonates with investors. In addition, our performance track record is excellent. We've produced attractive short- and long-term risk-adjusted returns. Really no matter how you look at it, whether on a long-term or a short-term basis, we've delivered real cash back to investors real alpha. As a result, our fundraising momentum is very strong, which has allowed us to successfully launch new products and grow existing strategies. In the last 6 months alone, we've added 4 new strategies with an expected fee-based AUM of more than EUR 5 billion each. The AI infrastructure fund, the scale of Europe fund and private capital, the U.S. Industrial Value Fund VII in real estate and KPN in Coller Capital. Delivering for our clients gives us the right to grow and scale existing business lines and strategies and to introduce attractive new products to help investors achieve their objectives when it comes to target returns and portfolio diversification. Next slide, please. Since the IPO, we have significantly expanded our offering for clients. At the time of the IPO, the EQT platform consisted primarily of the private equity and infrastructure flagship funds. Our private capital fundraising cycle was essentially 1 flagship fund, EQT IX at the time at roughly EUR 16 billion. Since then, we've added many strategies across the flagship, early-stage, long-haul and evergreen products. For many of these strategies, we're today also offering a specific geographic focus, across Europe, North America and Asia. As a result, in this cycle for private capital, we're targeting fundraising of approximately EUR 55 billion. That's an increase of 40% compared to the prior fundraising cycle. Similarly, in EQT Infrastructure, we've expanded the fundraising from only EUR 16 billion in Infra V at the time of the IPO to approximately EUR 45 billion for the current fundraising cycle, an increase of approximately 80% versus the prior cycle really an impressive achievement. In addition to the value-add funds, the infrastructure platform now includes the AI infrastructure fund, the transition infrastructure and active cost strategies as well as the evergreen vehicles. Next slide, please. Thanks to the broadening of our offering, we've been able to create a much more diversified business since our IPO. In September 2019, EQT managed approximately EUR 36 billion in fee-related AUM across 6 private equity and infrastructure focused strategies. Today, we manage EUR 155 billion of fee-generating AUM and EUR 291 billion of total AUM. Pro forma for Cole Capital and including the scale of Europe Fund our total AUM is now around EUR 345 billion as of the 30th of June. We want to leverage our scale, our global presence and insights to deliver the most attractive strategies, product solutions and performance for clients. The AI investment opportunity is a good example of this. Thanks to the breadth of our platform, we can find the most attractive risk reward and allocate capital accordingly for clients. for making investments into exciting native AI companies out of our early steps platform to investing into the opportunity at scale out of our infrastructure funds. With that, I hand it over to Gustav. Next slide, please.

Thank you, Per, and good morning, everyone. Turning to fundraising and highlights from the first half of the year, which has been very eventful with around EUR 18 billion of gross inflow turned into fee-generating AUM. For EQT 11, we secured commitments equal to half the target fund size of EUR 23 billion. half the target fund size at the first close for TX1 is slightly ahead of where we were with Infra 6 at the first close. Momentum remains strong with an active pipeline for the H2 and tilted towards Q4, just given the recent first close. We expect activation of the fund during Q3. As communicated, we've set the target fund size for Infra even at EUR 21 billion, and we're seeing promising early indications from investors on the back of very strong fund performance. Infra VII has signed its first deal acquiring Copia Power, [indiscernible] called prefund Bridge, and we expect activation around year-end, in line with earlier communication. At year-end, we expect to have held an early close for Infra VII. However, we don't expect the first close to happen until H1 2027. Hence, you should expect a smaller amount raised in 2026 then for EQT XI at activation. As a reminder, EQT XI and Infra VII will not contribute to fee-generating AUM until activation and hence, EQT XI is not part of the fee-generating AUM as of today. Across other closed-end strategies, we've been equally active. The scale-up Europe Fund is already anchored by a number of core investors representing the majority of the EUR 5 billion target fund size, and their commitment is expected to be closed out during Q3 with the activation of the fund at the same time. We're in parallel opening up the fund raise for additional investors and are seeing strong demand on the EUR 5 billion target fund size, and we have not yet set a hard cap for the fund. The fund will be paid on committed capital and is expected to have an average management fee rate in line with EQT's overall blended management fee rate. The the scale of Euro Fund will also mean that we will not be raising a second-generation growth fund. In addition to the scale up Europe fund, we're also raising a large number of additional closed-ended funds. Notably, our U.S. industrial value in real estate fund with a target of USD 6 billion as well as our transition Infra fund. On the institutional open-ended side, the active core infrastructure strategy has now finalized its founding round and it signed its first 2 investments. The fund will be activated during Q3 and has so far raised USD 2.3 billion of which a bit less than USD 1 billion will be fee generating directly at activation. The AI infrastructure fund reached more than USD 9 billion of fee-generating AUM at the end of Q2, driven by taking in both primary capital to fund future growth as well as secondary capital to sell down investments in Infra and Infra 5 as well as reflecting the strong value appreciation since launch. We expect continued strong development for AI infrastructure, which is open ended. However, also noting that significant capital has been brought in during the last months. And hence, you should not expect the same velocity of inflow going forward. The fund shortage fees on NAV, with the majority of the current capital, i.e., the EUR 9.4 billion came in as of July 1 and with a fee rate of between 50 to 75 bps currently closer to 50 bps due to the founder economics. Lastly, for the Private Welter greens, I will talk more about those on the following pages. Next slide, please. As of today, we've closed out approximately EUR 40 billion out of our EUR 100 billion fund target -- fundraising target. And currently, we have more than 20 vehicles in active fundraising across closed-ended and open-ended strategies. The remaining EUR 60 billion includes funds currently in fundraising as well as a couple of funds that are yet to launch fundraising. In addition, we've added 3 significant new elements: the AI infrastructure fund, the scale-up Europe Fund and the Coller Capital platform. Together, these are expected to add more than EUR 40 billion of additional fundraising. Hence, we are today expecting to raise more than EUR 140 billion in this fundraising cycle. Next slide, please. We're continuing to expand our Evergreen offering. Today, including the Coller platform, we have now reached EUR 10 billion in NAV and are continuing to grow rapidly with limited redemptions. During the first half, we have started 2 infrastructure vehicles, and we will, during Q3, launch an Asia-focused fund on the private capital side. In total, including Coller, we raised approximately EUR 2.5 billion during the first half, and we expect that to be a relatively good proxy for forward-looking half years. However, with the notion that Q4 will probably be stronger than Q3 just due to the holiday period in Q3. We recognize that wealth investors are more sensitive to headlines and market sentiment. This has been visible across the industry. Private credit evergreens products have faced most headwinds while other vehicles focused on other strategies have been more resilient. For EQT without Coller, we had around EUR 800 million of inflow in Q2 and driven mainly by a weak April due to the market sentiment and then May and June more in line with the levels that we saw in Q1. We continue to see momentum on the Infra side on the back of strong performance, and that's an attractive alternative to the significant outflow on the credit side. Redemptions in Q2 continued to be very limited at the same levels as in Q1, hence, around 0.5% of NAV per quarter across the platform. Next slide, please. So let me give you an update on the Coller transaction. We're on track to close the transaction in mid- to latter part of Q3, and the integration planning is ongoing at full speed. The structural opportunity within secondary is evident from the client demand for additional funds and new products and the continued muted distributions across the industry are widening that structural opportunity even further. Having closed KIP9 earlier this year, Coller's largest fund ever. We plan to launch the KIP9 fundraising later this year with the activation of the fund expected during the first half of next year, with fees charged on committed capital. Fundraising for CCO 3, the credit fund was launched in Q2 and has been well received by the market. CCO will charge fees on invested capital similar to their earlier fund vintages. Coller continues to see a growing market for structured products and insurance solutions. -- with an innovative evergreen structure closed here in the first half, and they expect to close a large traditional 10-year structured funding vehicle during the second half of the year. We identify insurance capital as 1 of the most interesting pools of capital within private markets. And through color, we get access to strong insurance relationships, as well as strong structuring capabilities. We're also in early preparations for additional share asset classes, drawing benefits from the combined platform including infrastructure secondaries. We continue to be very excited about secondaries and to join forces with the Coller team. And with that, I will hand over to Olof. Next slide, please.

Thank you very much, Gustav. So let's next turn to deal activity. And Pat covered our strong deal flow in H1, so let me focus on the exit activity. We announced about EUR 7 billion of fund exits and another EUR 10 billion for our co-investors during the first half of the year. We completed public sell-downs in Galderma and Azelis, in Eni and in Beorev, fully realizing the listed portfolio assets. Public market exits represented about 30% of the exit volumes in H1. On the infrastructure side, we completed a minority stake sale in Nordic Ferry Infrastructure as well as Edge ConneX from infrastructure for and across the early-stage platform, we completed the exit of tubules from LSP 7, which is the largest ever acquisition of a European private biotech company. We created a continuation vehicle for our well-performing assets in the Ventures One fund, providing further liquidity for those clients. At the start of the year, we announced an ambition to deliver exit volumes similar to last year's levels of about EUR 20 billion of exits. We maintain this ambition for the year despite the somewhat slower start to the year. As always, the market backdrop and specific deal situations can impact volumes in the short term, but we expect realization as to pick up versus the H1 volumes when we look a few quarters ahead. Looking at our pipeline for H2 specifically, we have a diversified pipeline across geographies, sectors and deal types, including a couple of potential IPOs and minority stake sales. Last year, exits were concentrated to private equity, and we expect exits to be more balanced towards infrastructure this year. And as the AI infrastructure strategy continues to ramp up, we also expect it to increase its ownership in EdgeConneX through further purchases of shares from Infra IV and V. Next slide, please. Turning to value creation. All of our key funds continued to perform on or above plan. During the second quarter, key fund valuations increased by about 5% and during the last 12 months, key fund valuations increased by 8%. Double-digit value uplift in infrastructure was led by strong underlying performance in the digital and energy subsectors in particular, as portfolio companies continue to secure new contract capacity and grow run rate EBITDA. Over the last 12 months, profitability accelerated across the private capital portfolio with 14% EBITDA growth in private capital, Europe and North America. Looking at EQT X specifically, saw mid-single-digit value creation in H1 and primarily due to strong operating performance with combined EBITDA growth of 24% over the last 12 months. In EQT IX, lower valuation multiples offset generally strong operating performances. And in the earlier private capital vintages, which are largely derisked already with a meaningful share of realized assets, there we saw softer performance. And across Private Capital Asia, operating performance was broadly positive, which, combined with stable valuation references supported largely positive value creation. So with that, let me hand it over to Kim.

Thank you. Thank you, Olof, and good morning, everyone. And moving to the financials next. Many of the ongoing fundraisings have started during 2026 and will continue into 2027. Thus, we expect, for example, the full year effects of EQT XI and Infra V to occur in 2027 with a step-up in management fee revenue as a consequence. In H1 2026, fee-related revenue was largely flat year-over-year, mainly due to large retroactive fees in the first half of '25 as well as significant exits in earlier fund generations during the last 12 months, which is helping the strong fundraising momentum across the platform. Excluding the effects of the retroactive fees, the fee-related revenue increased by about 5% year-over-year. We saw a higher level of fee-related performance revenues in the period. driven by the performance in our Evergreens and open-ended funds. We expect this to continue to grow in H2 and into 2027 and beyond as we scale the open-ended platforms. Carried interest and investment income grew by around 40%. Carry was primarily driven by exits in private capital and investment income was driven by valuation uplifts in EQT's financial investments. Taken together, this led to a total revenue growth of 5%. We have remained disciplined in our hiring with headcount marginally increasing during the first half. Our key strategic priorities for hiring continues to be private wealth, AI capabilities and geographical presence in Asia and the U.S. The guidance on the mid-single-digit OpEx growth made at the start of the year is still our expectation. The growth is related to the key strategic priorities mentioned as well as ramped up branding, marketing and AI spend. In H1 2026, our EBITDA margin remained flat at 60% and the fee-related EBITDA margin was 50%. During the latter part of 2027, it is likely that we reached the 5% fee-related EBITDA margin ambition we have mentioned before. I also wanted to repeat our guidance on Coller. As communicated at the year-end presentation, we continue to expect Coller to have a fee-related EBITDA of around EUR 175 million to EUR 200 million for the full calendar year 2026. Next slide, please. Let's turn to the outlook for carried interest. This year, carry will be based on key funds currently in carry mode. These funds have to date recognized EUR 1.4 billion and have yet to recognize around EUR 600 million over a multiyear period. We have broadened the group of funds expected to enter carryout next, and it now comprises Infra IV and Infra V, EQT IX and BPEA VIII. Moving Infra V and BPEA VIII into this bucket reflects the progress these funds are making on their value creation and exit plans and the pipeline of future carry contributors is maturing. Within this group, Infra 4 is the furthest progressed, and we expect to continue to realize part of the holding in Edge Connect, for example, across both Infra for and Infra fine. This puts Infra IV on a value creation and exit path towards initial carrier recognition in late 2027. Other funds in this bucket may move into carry mode from 2028 at the earliest. The funds in our most recent vintages are still investing and are fully focused on value creation. Next slide, please. Some final remarks on how we continue to use our balance sheet to support our growth agenda. The foundation of the balance sheet remains robust. We have low leverage ratios, we have strong cash generation and no bond maturities until 2028. And our revolver remains undrawn. Worth noting on cash generation is that we had some EUR 400 million of cash carry in H1 2026. With a well-capitalized balance sheet, we have also returned around EUR 750 million to shareholders over the last 12 months through dividends and buybacks. And we continue to have ample capacity to put our balance sheet to work and I will hand over to Gustav to comment on that.

Thank you, Kim. The workfalls seem to a couple of main buckets 4. First, long-term fund commitments. Our commitments alongside clients currently at around EUR 900 million, which aligns us with our investors and grows naturally with the platform. Secondly, the strategic balance sheet investments of approximately EUR 2 billion, mainly seeding our Evergreen private wealth vehicles and bridging new close-ended strategies through launch. These investments are designed to build EQT for the long term to create fee-generating AUM. Thirdly, structured solutions where we expect to increase investing into bespoke structures to drive business momentum and to add fee-paying commitments. This includes the structured insurance solutions, where EQT's balance sheet will participate in part of the equity investment. This is also one of the growth opportunities that the Colller transaction brings. And then, of course, lastly, M&A. The strategic use of the balance sheet is visible in the P&L. Investment income exceeded EUR 200 million in H1 more than what we generated in full year 2025. This reflects the broadening of platform as well as the strong value appreciation of the positions that we held on the balance sheet investments, especially on the infrastructure side. Assuming continued performance, we expect investment income to continue to be strong in H2 2026, in '27 and beyond. We believe that the level of carried interest and investment income achieved in H1 is a good proxy also for the second half of the year. And with that, I will turn back to Per for some concluding remarks. Next slide, please.

Thank you, Kim, and Gustav. To summarize, in a tricky market environment during the first half, we delivered strong performance and executed well on our strategy. Our long-term approach to building the most attractive global client-centric platform in our industry is paying off. A great example of this is the decision by the European Commission to select us to manage the scale-up fund for Europe, a testament to our market-leading position that we've built in Europe and the quality of the early states platform. The combination with Coller Capital is on track to close in the third quarter and will further strengthen our ability to serve clients. We were able to take advantage of the volatile market environment to unlock attractive new investments. Thanks to the breadth of our platform, we are perfectly positioned to invest into the AI opportunity and that's reflected in our strong deal flow. In the first half, we saw healthy value creation across our business, most notably in EQT Infrastructure where we're seeing exceptional momentum across strategies. In EQT X, we also saw mid-single-digit value creation in the quarter and overall operating performance in the private equity portfolio remains strong. In EQT X, the portfolio delivered 24% EBITDA growth in the last 12 months. Across the firm, we remain focused on monetizing investments and we have an ambitious exit pipeline for the next 6 to 12 months. We're really building on a record year of exits that we had in 2025 and when we sent back EUR 40 billion to clients. In the first half, we delivered EUR 17 billion of distributions. And based on the pipeline that we're seeing and subject to market conditions, we maintain our ambition to deliver exits in this year approximately in line with last year's volumes. Fundraising momentum across the firm remains strong. The AI infrastructure fund is off to an excellent start. Reception for the scale up Europe fund has been excellent and we've held the first close for ED1 at 50% of the target fund size. We also see continued nice momentum across our Evergreen platform with EUR 2.5 billion of inflows in the first half reaching a new milestone of EUR 10 billion in NAV. Before I open up for Q&A, I'd now like to take the opportunity to extend a big thank you to Kim Henriksson. This will be Kim's last webcast as CFO of EQT before he moves on to a senior adviser role within the firm. Kim is a deeply valued partner colleague and a friend, and he's done an outstanding job as the CFO during one of the most transformative periods of our firm. Kim is going to remain with EQT. And in that adviser role, he will be supporting our portfolio companies on IPO preparations and public company governance. So a big thank you to Kim. At the same time, I'm delighted to welcome Gustav as the new CFO. Gustav has played an important role in the strategic growth of our firm. He's been closely involved in the acquisitions of Exeter, BPEA and color and also in the development of our Evergreen platform. As part of the transition from Kim to Gustav, Olaf will take on additional responsibilities within the finance organization, which is also exciting. So with that, I open up for Q&A. Operator, please?

[Operator Instructions] We are now going to take our first question. Just 1 moment. And this question comes from the line of Arnaud Giblat from BNP Paribas.

I've got 2 questions, please. Firstly, could we come back on the investment income. I'm just -- the EUR 200 million is quite a large number. I'm just wondering if you could give a bit more detail as to strategy it comes from? It seems like quite a turnkey return, 10% over 6 months if you're -- if it's over the EUR 2 billion investment -- just a bit more detail there would be helpful. And secondly, with the Cole Capital, clearly, there's an opportunity as you've described to address more of the wealth channel. Are there any other avenues -- distribution avenues you could pursue perhaps small institutional mandates, where they allocate women seek to allocate the significant investments to what manager to do there's a lot in terms of investments for them. Any -- yes, so I was just wondering there and what investments are required to achieve these step-ups in wealth and other distribution opportunities.

Yes. Thank you for those questions. I will hand both of those questions to Gustav. Just a quick comment on Cole Capital. -- in addition to private wealth, as we have previously communicated, we are also really excited about the opportunity in the insurance channel that we're seeing. But I'll let Gustav elaborate on that. .

Yes. Happy to. Maybe starting a little bit with the investment income side. I would say that, as I alluded to, it's very broad-based across the platform, but with the skewness to the Infra side just given the strong performance there. I think the way to think about it going forward, so to speak, is if you think -- I would we have around EUR 3 billion. So the EUR 2 billion plus EUR 900 million of fund investments. So in total, we're talking about around three billion where we're generating around EUR 200 million. So that's, let's say, just shy of 15% return during the half year. I think if you think about that, then it's not like a crazy number given the return targets that we have. not all of the EUR 300 million are going to have the same type of return targets just given that some of it is more like bridges and stuff like that. But if you think about it in a 10% to 15% return on the balance sheet, you kind of end up in that ballpark. So that's how I would think about the investment income side. When it comes to Coller capital, I would say I think the what we want to build across is really to create more solutions for investors. And that goes for private wealth investors, it goes for institutional investors. It goes for insurance clients that Peer referenced. I would say in the area of, let's say, smaller institutions, we have not maybe had like the same type of success as some other firms in Europe. And I think this gives us another tool in the toolbox in order to be able to attack that part of the market. So it's for sure, an interesting area for it. And then lastly, when it comes to growing in wealth, I would say that we've taken the majority of those investments, we're going to continue to invest into the brand and marketing side, even though I think the cost that you have in 2026 is a relatively good proxy. It would probably go up a bit in 2017 and beyond, but not to the same extent given that we've grown the sales organization now we're growing the brand and marketing setup. So now I think we feel that we are well equipped, of course, also given that we've gotten a lot of strong people and relationships through the Colller acquisition.

We are now going to move to our next question and this question comes from the line of Haley Tam from UBS.

Can I ask 2 and also then a follow-up on the investment income one, but the 2 initial questions. On the AI infra fund, that's EUR 9.4 billion already, which is fantastic. Could you clarify for us how much of that was primary versus secondary? And I guess, specifically, how much was Edge Connect and I think you mentioned there might be more of that in the future. So just to get a handle on that would be great. Secondly, the effective management fee. I think it was 1.4% in H1 last year. I couldn't see a disclosure of what it was this year. And I heard what Kim said about retroactive fees, but I just wondered if you could help us understand that for the underlying momentum, that would be great. And then just a follow-up on the investment income. I think you mentioned the ETC balance sheet will participate in equity investment insurance structures going forward. Can I just clarify whether that's a recycling of the EUR 3 billion or whether we should expect that to be incremental in the future?

Thank you for those questions. I suggest we answer them in the order that you asked them, and maybe Olof takes the first 1 and then Kim and go stop.

Yes. On the AIM fund, I believe, was your first question. Haley. It's -- this is a structure that is invested in 1 solely at this point in time. And a large part of the EUR 9.4 billion is primary capital that we have raised for that. That's the vast majority of this and the primary capital that we raised the fund is used to fund the CapEx and the growth for EdgeConneX primarily. -- and that is also driving a meaningful uplift that you see in the valuation of the fund in this quarter, but it also means that we are investing in the future growth of this. And that's why we also have a very strong outlook for the performance of this fund from here.

And maybe if I take the last 2 questions. I would say on the effective management fee, I would for the closed standard side, it's unaffected, so to speak. So the EUR 1.4 billion is still valid. Of course, when you bring -- when we bring in additional capital in -- from especially the AI infrastructure fund with a lower fee rate, but also note that the EUR 9.4 million the vast majority of that was included as of June 30, so to speak. So there is no management fee for the first half, but it's included in the end of the period management or fee-generating AUM. So it will be a little bit distorted there just given that in the first half of it. And then when it comes to the investment income, it's not part of the EUR 3 billion so there might be a bit of incremental increase in it. The way to think about it is, however, also that some of the other capital, i.e., EUR 2 billion will come back. So it's -- I wouldn't put it on top, but I would think that the EUR 3 billion will probably continue to grow probably at a little bit lower pace than what we've had in the last months just given the significant ramp-up that we've had on the Evergreen side, which has which has, let's say, eaten quite a lot of balance sheet capital, which then, over time, will probably, let's say, work its way into other things. So that's how you should think about it.

We are now going to move to our next question. And this question comes from the line of Nicholas Herman from Citi.

Yes. and best of luck to Kim in the new role. Two questions from my side, please. So I appreciate you see upside to the fundraising cycle. You referenced the challenging fundraising environment for real estate. But my sense is that it's also just more challenging across the piece, given I guess, geopolitical disruption or driven uncertainty. Clearly, you guys are very well positioned at the Alpha platform and will take share. But I guess are you seeing that just that challenging fundraising to? And I'm wondering, does like a first close of EQT, which is, I guess, percentage-wise, lower than prior vintages. Is that kind of indicative that it is just a bit tougher. So just kind of thoughts on the general fundraising environment, please. Secondly, thank you for on expected time frame for carry recognition with EQT IX at 0.3x DPI, Infra and BPA at 1.1x DPI. I guess what gives you confidence that those funds will enter carry mode by 2028? And I guess what level of DPI would you expect those funds to have reached by then? And then just a very quick follow-up if I may on the investment income. Was there any investment income kind of booked within that, I guess, the central part of your group that was also linked to the EdgeConneX an AI transition -- AI infrastructure fund.

I can start. So on the on the fundraising environment, the comment that I made was specifically to real estate and the asset class having faced a more challenging fundraising environment for a longer period of time. And we see activity levels in real estate picking up. And on the back of the strong performance that we've had historically, we've doubled our fee-based in this part of our business. And if anything, compared to the last 5 years, we think that the outlook for this asset class is likely to be more favorable. And so probably including a more benign fundraising environment. Overall, for the industry, we very much agree with your characterization. What we're seeing now is something we've spoken about in previous calls with you that LPs, institutional investors, but also private wealth platforms, consolidating their GP relationships. And that is happening right now. And in this environment, we have been able to take market share, thanks to the breadth of our platform, the strong strategic positioning that we've had, but also the outperformance that we generated, right? Just to remind you, again, in 2025, we sent back EUR 40 billion of NAV. And in our private equity strategies in Asia and in Europe and the U.S., that was more than 30% of NAV, which is 3x industry average. And that has helped us in our fund raises in BPA 9 where we hit the hard cap. And also now in EQT XI where we've secured of the fund size target. I would say that is in line with our expectation. If you look at Infra Fund VI, as Gustav mentioned earlier, right? The first close that we had for that fund was actually slightly below the 50% that we've secured so far for EQT XI. So we think we're in an excellent position in this fund raise. And based on the strong deal flow that we have right now, also in the co-invest that we're generating we want to build on that momentum during the second half and then into 2027. In terms of what gives us confidence on the carry recognition, it's just the exit pipeline that we're seeing for all these funds that we're working on. Of course, it's always subject to market conditions, but that's reflected in the guidance that we've given now. The only additional point I would make is that of course, when it comes to the infrastructure IV, specifically, the way this fund is positioned in terms of the AI infrastructure opportunity and the momentum that we're seeing in performance around that and the exposure that this fund and Infra V has we see a good and credible path to reaching the DPI for Infra IV by the end of 2027 as Olof touched upon. When it comes to investment income, I'll let Gustav or Olof comment on that.

Yes. I can go. So I would say that the -- as I said, the investment income is broad-based. -- it's not so much specifically to the AI infra fund. However, of course, given the performance of the edge asset, etcher asset across a number of different funds that we have, including Infra IV, V and VI. That is a contributor to it, but it is really a broad-based value that we see.