NEW YORK (AP) -- Private equity giant Blackstone Group reported a loss for the second quarter after the value of its investments declined and its income from fees fell due to wild swings in the global financial markets.
The New York company reported a net loss of $75 million, or 14 cents per share. That compares with net income of $86.2 million, or 18 cents a share, in the second quarter of 2011.
Wall Street analysts were expecting income of 11 cents per share, according to a poll by data provider FactSet.
Total revenue fell 52 percent to $627 million in the second quarter, down from $1.3 billion in the same quarter the year before. Analysts had expected Blackstone to report revenue of $620.4 billion.
A drop in fees and lower investment income were mainly to blame, Blackstone said.
Performance fees, the cut it takes from its investment returns, plunged 80 percent to $135.4 million, as the value of its investments fell in the quarter when financial markets swung wildly.
The value of stocks fell globally. In the U.S., the Standard & Poor's 500 index fell 3.3 percent and the Nasdaq 5 percent.
But Blackstone's total assets under management grew 20 percent from last year to $190 billion at the end of the quarter.
"In an environment characterized by slowing global growth and heightened investor caution, our limited partner investors are entrusting us with a greater share of their capital," said Blackstone CEO Stephen Schwarzman.
The company boasted that its newest global real estate fund is over $12 billion in total size, the largest fund of this type ever raised.
Blackstone's stock rose 45 cents, or 3.5 percent, to $13.35 in afternoon trading Thursday.
Not all its investors were happy with Blackstone's performance and the private equity company returned $13 billion of capital to its investors.
However, more wealthy investors are turning the private equity companies like Blackstone. That's because there aren't too many avenues for income. Interest rates are at historic lows, leading to some of the lowest coupons in bonds, and the stock market's gyrations have become too much for some people to stomach.
Blackstone invests money in a variety of ways — by buying companies or taking stakes in corporations, investing in real estate and providing other investors with loans on a global basis.
Investors who cannot do such activities on their own funnel their money to Blackstone. In the quarter, $44 billion flowed in to Blackstone from such investors. About $10 billion came from Harbourmaster Capital, a European loan manager that Blackstone bought.
