Slide 1: Earnings Presentation 2Q 2023
EARNINGS PRESENTATION 2Q 2023 August 4, 2023 1
Slide 2: Cautionary Statement Regarding Forward-Looking Statements
CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This presentation may contain forward-looking statements within the meaning of the federal securities laws, including statements relating to (i) our strategy, outlook and growth prospects, (ii) our operational and financial targets and (iii)
Slide 3: Important Note Regarding Non-GAAP Financial Measures
IMPORTANT NOTE REGARDING NON-GAAP FINANCIAL MEASURES This presentation includes certain “non-GAAP” supplemental measures that are not defined by generally accepted accounting principles, or GAAP, including certain of the financial metrics defined below, of which the calculations may differ from meth
Slide 4: DBRG Reports Second Quarter 2023 Results
DBRG REPORTS SECOND QUARTER 2023 RESULTS Boca Raton, August 4th, 2023 - DigitalBridge Group, Inc. (NYSE: DBRG) and subsidiaries (collectively, “DigitalBridge,” or the “Company”) today announced financial results for the second quarter ended June 30, 2023. The Company reported second quarter 2023 tot
Slide 5: DigitalBridge Second Quarter 2023 GAAP Results
DIGITALBRIDGE SECOND QUARTER 2023 GAAP RESULTS CONSOLIDATED STATEMENT OF OPERATIONS Three Months Ended June 30, (In thousands, except per share data, unaudited) 2023 2022 Revenues Fee income $ 65,742 $ 44,318 Carried interest allocation (reversal) 79,254 110,779 Principal investment income (loss) 30
Slide 6: Agenda
AGENDA 1 SECTION BUSINESS UPDATE 2 SECTION FINANCIAL RESULTS 3 SECTION EXECUTING THE DIGITAL PLAYBOOK 6
Slide 7: Business Update
DIGITALBRIDGE ball 1
Slide 8: Progress on Our 2023 Priorities: The Things That Matter
PROGRESS ON OUR 2023 PRIORITIES: THE 3 THINGS THAT MATTER In 2Q23, DigitalBridge made significant progress towards achieving its key 2023 priorities, including strong capital formation, operating segment deconsolidation, and support for the continued growth of its portfolio companies. Strong Growt
Slide 9: New Capital Formation
NEW CAPITAL FORMATION DigitalBridge has raised $3.4B in new fee-earning equity YTD(1), up $2.7B since last quarter, driven principally by initial commitments to the latest DBP Series (which will begin generating fees following an initial close later in 2023) and new co-invest capital. DBRG remains o
Slide 10: Assets & Fee Earning Equity Under Management
ASSETS & FEE EARNING EQUITY UNDER MANAGEMENT Fee-Earning Equity Under Management (FEEUM) increased $10.1B, or 53% YoY, to $29.1B powered by organic capital formation and contribution from the InfraBridge acquisition. FEEUM AUM(1) ($ in Billions) ($ in Billions) +51% $72.2 FEEUM growth is Key Revenue
Slide 11: Deconsolidation Update – DataBank Recap
DECONSOLIDATION UPDATE – DATABANK RECAP DBRG expects to finalize commitments to the DataBank recapitalization sufficient to deconsolidate DataBank from DBRG’s financial statements by the end of August 2023, and complete a final close on the recap by the end of 3Q23. DATABANK DECONSOLIDATION VANTAGE
Slide 12: Portfolio Performance
PORTFOLIO PERFORMANCE Powerful secular tailwinds, driving demand for compute and connectivity, continue to underpin positive performance across our diversified global portfolio. Ultimately portfolio performance drives returns. DATA CENTER TOWER FIBER SMALL Supporting Portfolio Growth PORTFOLIO PORTF
Slide 13: Financial Results
2 FINANCIAL RESULTS 13
Slide 14: Second Quarter 2023 Highlights – Key Metrics
DIGITALBRIDGE’S SECOND QUARTER 2023 HIGHLIGHTS – KEY METRICS Fee Income – IM Segment Fee Related Earnings – IM Segment Distributable Earnings - Corporate $66.5M $34.4M $10.0M 47% 35% $45.1M $25.5M 15.6x $0.6M 2Q22 2Q23 2Q22 2Q23 2Q22 2Q23 FEEUM AUM Run Rate Fee Revenue(1) $29.1B $72.2B $275.3M 51% 5
Slide 15: Second Quarter 2023 Highlights & KPIs
SECOND QUARTER 2023 HIGHLIGHTS & KPIs At share, DBRG shareholder metrics for the quarter ended June 30, 2023; Fee Income in the investment management segment was $66.5 million, up 47% year-over-year. Financial Fee Related Earnings in the investment management segment (“IM FRE”) was $34.4 million
Slide 16: Consolidated Results (Non-GAAP)
CONSOLIDATED RESULTS (NON-GAAP) Fee Income was up significantly, 48%, YoY. At-share total revenue and Adjusted EBITDA were both up >30% over the prior year and DigitalBridge generated $10 million in Distributable Earnings during the quarter. TOTAL COMPANY 2Q22 2Q23 % Change YOY 2Q22 LTM 2Q23 LTM % C
Slide 17: Investment Management Results (Non-GAAP)
INVESTMENT MANAGEMENT RESULTS (NON-GAAP) During 2Q23, Fee Income increased 47% with additional FEEUM from new strategies and InfraBridge contributing to revenue growth. FRE at-share and segment-level distributable earnings were both up substantially YoY. FRE Margin was impacted by lower contribution
Slide 18: Investment Management Segment Detail (Non-GAAP)
INVESTMENT MANAGEMENT SEGMENT DETAIL (NON-GAAP) New additional disclosure designed to simplify analysis of realized vs. unrealized carried interest allocations and associated expenses. Other IM Expense Detail captures expenses which impact segment-level DE. % Change Carried Interest Detail 2Q22 2Q23
Slide 19: Operating Segment Results (Non-GAAP)
OPERATING SEGMENT RESULTS (NON-GAAP) Operating Segment revenues and earnings declined YoY due to lower DBRG ownership of businesses in this segment. Notably, since 2Q22, progress on the DataBank recap lowered DBRG ownership from 22% to 11%. Excluding the impact of the ownership reduction and certain
Slide 20: Consistent Investment Management Growth
CONSISTENT INVESTMENT MANAGEMENT GROWTH Investment management segment has continued to grow consistently with ‘lower left to upper right trajectory’. Run-Rate Fee Revenue, which assumes full deployment of committed capital, continued to increase with contributions from new capital formed during the
Slide 21: Balance Sheet Profile
BALANCE SHEET PROFILE Primary assets are GP stakes, Operating Segment Net Equity Value and Corporate Cash. DigitalBridge continues to maintain strong liquidity levels. Assets Capitalization DigitalBridge consolidates financial statements of Operating Segment portfolio companies’ ’Investment Level De
Slide 22: Executing the Digital Playbook: Early Impacts of Generative AI
3 EXECUTING THE DIGITAL PLAYBOOK EARLY IMPACTS OF GENERATIVE AI 22
Slide 23: Generative AI: It's Fundamentally Different
GENERATIVE AI: ITS FUNDAMENTALLY DIFFERENT Generative AI infuses new layers of creativity into Traditional ‘analysis-centric’ AI, unlocking new capabilities Pharma TRADITIONAL AI GENERATIVE AI Scan large Design entirely datasets to new molecules to identify potential treat diseases drug candidates M
Slide 24: Generative AI Adoption Is the Fastest on Record
GENERATIVE AI ADOPTION IS THE AI IS A CLOUD-SCALE FASTEST ON RECORD OPPORTUNITY ChatGPT represented ‘iPhone Moment’ for generative AI We are in the early innnings TIME IT TOOK ChatGPT 2 months TO REACH 100 MILLION CLOUD MONTHLY USERS Tiktok WORLD WIDE Instagram ~$300B(1) ~$300B+ Pinterest Cloud Serv
Slide 25: Generative AI Workloads Are Power Hungry
GENERATIVE AI WORKLOADS ARE POWER HUNGRY CHIP POWER LARGE MODELS ARE GROWING DATA CENTERS WILL NEED FAR IS EXPLODING, … EXPONENTIALLY,… MORE POWER Power consumption (W) per chip(1) Model Size, in Billions of Parameters(2) Data Center Power Consumption (TWh) 1,250 1000B PaLM (540B) 8% CAGR1 GPT-3 (17
Slide 26: Cloud-Trained: Gen AI Is Power Hungry
CLOUD-TRAINED: GEN AI IS POWER HUNGRY Gen AI model training is compute-bound…more compute resources are tied to a better product. Access to digital infra in size, at the lowest total cost, is a key success factor. HIGHER MW HIGHER POWER DENSITY LOWER PRICE PER KW per facility(1) per rack Access to L
Slide 27: Edge Delivered: Intelligence Lives Across the Network
EDGE DELIVERED: INTELLIGENCE LIVES ACROSS THE NETWORK AI Inference, the process of actually using a cloud-trained AI model, happens at the edge. Here, trained AI models and the data to support the AI inference process must be deployed close to enterprises and consumers in a cost-efficient, latency -
Slide 28: Cloud Trained/Edge Delivered: DBRG Portfolio Positioned for AI Demand
CLOUD TRAINED/EDGE DELIVERED: DBRG PORTFOLIO IS WELL POSITIONED TO MEET GROWING DEMAND FOR AI WORKLOADS With one of the ‘newest fleets’ in the business, DigitalBridge’s global data center portfolio operates from the core to the edge of the network, serving well-defined workload profiles across an in
Slide 29: DigitalBridge Is at the Intersection of AI Supply and Demand
DIGITALBRIDGE IS AT THE INTERSECTION OF AI SUPPLY AND DEMAND We are in the very early innings of the Generative AI-driven demand cycle, but already see tangible evidence manifesting in our data center pipelines and in conversations with our largest institutional investors. SUPPLY DEMAND REPORTS FROM
Slide 30: 2023 CEO Priorities: Things That Matter
2023 CEO PRIORITIES: 3 THINGS THAT MATTER CEO 2023 Checklist Secular Tailwinds Around FUNDRAISE Connectivity – Big Growing TAM • $8B IN NEW CAPITAL • STRONG MOMENTUM AT DBP SERIES The Leading Management Team SIMPLIFY 25+ years Investing and • DECONSOLIDATE DATABANK Operating Digital Assets • VANTAGE
Slide 31: Q&A Session
teat! DIGITALBRIDGE Q&A SESSION
Slide 32: Appendix
5 APPENDIX 32
Slide 33: Non-GAAP Reconciliations
NON-GAAP RECONCILIATIONS ($ in thousands) 2Q 23 1Q 23 4Q 22 3Q 22 2Q 22 1Q 22 4Q 21 3Q 21 Net income (loss) attributable to common stockholders $ (22,411) $ (212,473) $ (19,356) $ (63,273) $ (37,321) $ (262,316) $ (20,686) $ 41,036 Net income (loss) attributable to noncontrolling common interests in
Slide 34: Non-GAAP Reconciliations
NON-GAAP RECONCILIATIONS ($ in thousands) 2Q 23 1Q 23 4Q 22 3Q 22 2Q 22 1Q 22 4Q 21 3Q 21 IM n et in come ( los s ) $ 35,177 $ ( 2,804) $ 81,167 $ 46,065 $ 67,995 $ ( 9,143) $ 28,194 $ 39,272 Adjustments: Interest expense (income) 2,268 2,411 2,200 2,906 2,771 2,500 2,499 2,250 Investment expense, n
Slide 35: Balance Sheet
BALANCE SHEET ($ in thousands, except per share data) (unaudited) As of Ju n e 30, 2023 Con s ol i dat ed A s s et s Cash and cash equivalents $ 426,883 Restricted cash 154,687 Investments 1,288,877 Real estate 6,178,467 Goodwill 923,112 Deferred leasing costs and intangible assets 1,052,822 Other a
Slide 36: DigitalBridge
DIGITALBRIDGE
Slide 37: Supplemental Financial Report Second Quarter 2023
DIGITAL SUPPLEMENTAL FINANCIAL REPORT SECOND QUARTER 2023 August 4, 2023
Slide 38: Cautionary Statement Regarding Forward-Looking Statements
Cautionary Statement Regarding Forward-Looking Statements This presentation may contain forward-looking statements within the meaning of the federal securities laws. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and
Slide 39: Important Note Regarding Non-GAAP Financial Measures
Important Note Regarding Non-GAAP Financial Measures This financial supplemental package includes certain non-GAAP financial measures and operating metrics that are not defined by generally accepted accounting principles, or GAAP. Following our decision not to maintain qualification as a REIT for 20
Slide 40: Note Regarding DBRG Reportable Segments
Note Regarding DBRG Reportable Segments / Consolidated and OP Share of Consolidated Amounts This presentation includes supplemental financial information for the following segments: Investment Management (IM) This business represents a leading global digital infrastructure investment platform, manag
Slide 41: Table of Contents
Table of Contents Page I. Financial Overview a. Summary Financial Metrics 6 b. Investment Management 7 II. Financial Results a. Balance Sheet Consolidated & Noncontrolling Interests’ Share 8-9 b. Consolidated Segment Operating Results 10 c. Noncontrolling Interests’ Share Segment Operating Results 1
Slide 42: Ia. Summary Financial Metrics
Ia. Summary Financial Metrics ($ and shares in thousands, except per share data and as 6/30/2023 - 3/31/2023 - 12/31/2022 - 9/30/2022 - 6/30/2022 - 3/31/2022 - 12/31/2021 - 9/30/2021 - noted) (Unaudited) 2Q23 1Q23 4Q22 3Q22 2Q22 1Q22 4Q21 3Q21 Financial Data Total Company Net income (loss) attributa
Slide 43: Ib. Investment Management
Ib. Investment Management ($ in millions) 6/30/23 Annual IM Investment Management FEEUM Fee Rate 6/30/23 3/31/23 12/31/22 9/30/22 6/30/22 3/31/22 12/31/21 9/30/21 DigitalBridge Partners I (DBP I) 1.10% $ 3,311 $ 3,180 $ 3,165 $ 2,802 $ 3,048 $ 3,034 $ 3,215 $ 3,040 DigitalBridge Partners II (DBP II)
Slide 44: IIa. Financial Results - Balance Sheet
IIa. Financial Results - Balance Sheet ($ in thousands, except per share data) (unaudited) As of June 30, 2023 Noncontrolling Consolidated Interests' Share Assets Cash and cash equivalents $ 426,883 $ 94,444 Restricted cash 154,687 131,713 Investments 1,288,877 493,971 Real estate 6,178,467 5,460,46
Slide 45: IIa. Financial Results - Balance Sheet
IIa. Financial Results - Balance Sheet Supplemental Schedule to Consolidated Balance Sheets ($ in thousands) (unaudited) As of June 30, 2023 Investment Management Operating Corporate and Other Assets Cash and cash equivalents $ 68,548 $ 72,087 $ 286,248 Restricted cash 2,349 151,248 1,090 Investment
Slide 46: IIb. Consolidated Segment Operating Results
IIb. Financial Results - Consolidated Segment Operating Results Three Months Ended June 30, 2023 Investment Corporate and Discontinued ($ in thousands) (unaudited) Management Operating Other Operations Total Revenues Fee income $ 66,631 $ — $ (889) $ — $ 65,742 Carried interest allocation 79,254 — —
Slide 47: IIc. Noncontrolling Interests' Share Segment Operating Results
IIc. Financial Results - Noncontrolling Interests’ Share Segment Operating Results Three Months Ended June 30, 2023 Investment Corporate and Discontinued ($ in thousands) (unaudited) Management Operating Other Operations Total Revenues Fee income $ 33 $ — $ — $ — $ 33 Carried interest allocation 35,
Slide 48: IId. Segment Reconciliation of Net Income to DE and Adjusted EBITDA
IId. Financial Results - Segment Reconciliation of Net Income to DE and Adjusted EBITDA Amounts OP pro rata share by segment attributable to DBRG Corporate Discontinued Total OP pro noncontrolling consolidated ($ in thousands; for the three months ended June 30, 2023; and unaudited) IM Operating and
Slide 49: IId. Segment Reconciliation of Net Income to DE and Adjusted EBITDA
IId. Financial Results - Segment Reconciliation of Net Income to DE and Adjusted EBITDA OP pro rata share by segment Corporate and Discontinued Total OP pro ($ in thousands; for the three months ended June 30, 2023; and unaudited) IM Operating Other Operations rata share After-tax DE $ 24,429 $ 5,16
Slide 50: IIIa. Capitalization - Debt Summary
IIIa. Capitalization - Debt Summary ($ in thousands; as of June 30, 2023) Consolidated debt Payments due by period(1) 2023 2024 2025 2026 2027 and after Total Investment-level debt: Operating - Fixed $ 1,990 $ 600,753 $ 700,000 $ 1,519,690 $ 1,806,000 $ 4,628,433 Operating - Variable — 262,500 8,476
Slide 51: IIIb. Capitalization - DBRG Series 2021-1
IIIb. Capitalization - DBRG Series 2021-1 ($ in thousands, as of June 30, 2023) Class A-2 Term Notes Amount outstanding $ 300,000 Interest rate 3.933 % Anticipated Repayment Date (ARD) September 25, 2026 Kroll Rating BBB Class A-1 Variable Funding Notes Maximum Available $ 300,000 (1) Amount outstan
Slide 52: IIIc. Convertible/Exchangeable Notes & Perpetual Preferred Stock
IIIc. Capitalization - Convertible/Exchangeable Notes & Perpetual Preferred Stock ($ in thousands; except per share data; as of June 30, 2023) Convertible/exchangeable debt Conversion price (per share Outstanding of common Conversion Conversion Description principal Final due date(1) Interest rate s
Slide 53: IV. Operating
IV. Operating ($ in millions) Portfolio Net Carrying Value 6/30/23 3/31/23 12/31/22 9/30/22 6/30/22 3/31/22 12/31/21 9/30/21 Consolidated amount Asset(1) $ 9,246 $ 8,920 $ 8,704 $ 8,515 $ 8,429 $ 8,397 $ 7,624 $ 7,211 Debt(2) (5,123) (4,870) (4,634) (4,506) (4,477) (4,479) (4,217) (3,817) Net Carryi
Slide 54: IV. Operating
IV. Operating Operating Capital Expenditures Consolidated amount 2Q23 1Q23 4Q22 3Q22 2Q22 1Q22 4Q21 3Q21 Non-revenue enhancing capital expenditures $ 8,284 $ 8,564 $ 14,775 $ 10,992 $ 13,377 $ 7,418 $ 6,410 $ 7,387 Revenue enhancing capital expenditures 163,767 129,710 135,506 147,046 101,100 84,668
Slide 55: V. Other
V. Other ($ in thousands) Consolidated amount 2Q23 1Q23 4Q22 3Q22 2Q22 1Q22 4Q21 3Q21 GP Co-investment in DBP I and II Investments $ 374,139 $ 345,719 $ 343,137 $ 277,450 $ 284,282 $ 248,663 $ 242,856 $ 230,972 GP Co-investment in GIF Investment 135,857 142,280 — — — — — — Equity interests in digita
Slide 56: VI. Cash G&A Expense
VI. Cash G&A Expense ($ in thousands) 2Q23 1Q23 4Q22 3Q22 2Q22 1Q22 4Q21 3Q21 Investment Management Cash G&A Cash and equity-based compensation $ 45,798 $ 28,182 $ 30,829 $ 22,566 $ 23,230 $ 24,808 $ 20,802 $ 21,606 Administrative expenses 7,953 6,407 7,958 4,517 4,869 4,171 4,387 5,820 Compensation
Slide 57: Appendices
Appendices DigitalBridge | Supplemental Financial Report 21
Slide 58: Reconciliations of IM FRE and Operating Adjusted EBITDA to Net Income (Loss)
Reconciliations of IM FRE and Operating Adjusted EBITDA to Net Income (Loss) ($ in thousands) 2Q23 1Q23 4Q22 3Q22 2Q22 1Q22 4Q21 3Q21 IM net income (loss) 35,177 (2,804) 81,167 46,065 67,995 (9,143) 28,194 39,272 Adjustments: Interest expense (income) 2,268 2,411 2,200 2,906 2,771 2,500 2,499 2,250
Slide 59: Reconciliations of DE and Adjusted EBITDA to Net Income (Loss)
Reconciliations of DE and Adjusted EBITDA to Net Income (Loss) ($ in thousands) 2Q23 1Q23 4Q22 3Q22 2Q22 1Q22 4Q21 3Q21 Net income (loss) attributable to common stockholders $ (22,411) $ (212,473) $ (19,356) $ (63,273) $ (37,321) $ (262,316) $ (20,686) $ 41,036 Net income (loss) attributable to nonc
Slide 60: Reconciliations of DE and Adjusted EBITDA to Net Income (Loss)
Reconciliations of DE and Adjusted EBITDA to Net Income (Loss) ($ in thousands) 2Q23 1Q23 4Q22 3Q22 2Q22 1Q22 4Q21 3Q21 After-tax DE $ 10,012 $ (3,365) $ (18,393) $ 32,335 $ 603 $ (5,064) $ (11,636) $ (4,886) Interest expense included in DE 10,130 12,549 13,756 16,348 14,142 13,280 13,775 14,160 Inc
Slide 61: Definitions
Definitions Assets Under Management (“AUM”) Assets owned by the Company’s balance sheet and assets for which the Company and its affiliates provide investment management services, including assets for which the Company may or may not charge management fees and/or performance allocations. Balance she