Slide 1: Earnings Presentation 2Q 2023
1 EARNINGS PRESENTATION 2Q 2023 August 4, 2023
Slide 2: Cautionary Statement Regarding Forward-Looking Statements
2 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
3 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 me
Slide 4: DBRG Reports Second Quarter 2023 Results
4 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 t
Slide 5: DigitalBridge Second Quarter 2023 GAAP Results
5 DIGITALBRIDGE SECOND QUARTER 2023 GAAP RESULTS Three Months Ended June 30, 2023 2022 Revenues Fee income $ 65,742 $ 44,318 Carried interest allocation (reversal) 79,254 110,779 Principal investment income (loss) 30,409 16,444 Property operating income 234,753 234,251 Other income 14,775 10,840 Tot
Slide 6: Agenda
6 AGENDA BUSINESS UPDATES E C T IO N 1 FINANCIAL RESULTSS E C T IO N 2 S E C T IO N 3 EXECUTING THE DIGITAL PLAYBOOK
Slide 7: Business Updates
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Slide 8: Progress on Our 2023 Priorities: The Things That Matter
8 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 Gro
Slide 9: New Capital Formation
9 $1.2 $0.9 $0.6 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 capita
Slide 10: Assets & Fee Earning Equity Under Management
10 $11.0 $11.2 $11.3 $4.7 $7.0 $8.0 $5.1 $5.1 $2.4 $2.2 $2.3 $0.9 $2.2 $2.4 $19.0 $27.7 $29.1 2Q22 1Q23 2Q23 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
Slide 11: Deconsolidation Update – DataBank Recap
11 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. VANTAGE SDC DECONSOLIDATIONDAT
Slide 12: Portfolio Performance
12 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. (1) The Company defines Monthly Recurring Revenue “MRR”, as revenue fr
Slide 13: Financial Results
13 2 FINANCIAL RESULTS
Slide 14: DigitalBridge's Second Quarter 2023 Highlights – Key Metrics
14 $47.9B $72.2B 2Q22 2Q23 $180.9M $275.3M 2Q22 2Q23 $19.0B $29.1B 2Q22 2Q23 $0.6M $10.0M 2Q22 2Q23 $25.5M $34.4M 2Q22 2Q23 $45.1M $66.5M 2Q22 2Q23 DIGITALBRIDGE’S SECOND QUARTER 2023 HIGHLIGHTS – KEY METRICS Fee Income – IM Segment Fee Related Earnings – IM Segment Distributable Earnings - Corporat
Slide 15: Second Quarter 2023 Highlights & KPIs
15 SECOND QUARTER 2023 HIGHLIGHTS & KPIs Financial Highlights 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. ▪ Fee Related Earnings in the investment management segment (“IM FRE”) was
Slide 16: Consolidated Results – Total Company
16 TOTAL COMPANY 2Q22 2Q23 % Change YOY 2Q22 LTM 2Q23 LTM % Change YOY Fee Income $44.3 $65.7 +48% $193.4 $210.4 +9% Carried Interest (realized and unrealized) 110.8 79.3 (28%) 168.0 323.1 +92% Principal Investment Income 16.4 30.4 +85% 88.6 7.4 (92%) Property Operating Income 234.3 234.8 +0% 821.5
Slide 17: Investment Management ("IM") Segment Results
17 INVESTMENT MANAGEMENT ("IM") 2Q22 2Q23 % Change YOY 2Q22 LTM 2Q23 LTM % Change YOY Fee Income, excluding incentive fees $45.1 $66.5 +47% $191.3 $213.0 +11% Other Income 0.5 1.1 1.5 2.5 G&A (20.2) (33.1) (74.3) (100.8) Fee Related Earnings ("FRE") $25.5 $34.4 +35% $118.5 $114.6 (3%) Minority Holde
Slide 18: Investment Management Segment Detail (Non-GAAP)
18 Carried Interest Detail 2Q22 2Q23 % Change YoY Unrealized Carried Interest – Income $110.8 $79.3 Realized Carried Interest – Income – – Carried Interest – Income (as reported on GAAP Income Statement) $110.8 $79.3 (28%) Unrealized Carried Interest – Compensation Expense ($49.1) ($36.1) Realized C
Slide 19: Operating Segment Results (Non-GAAP)
19 OPERATING 2Q22 2Q23 % Change YOY 2Q22 LTM 2Q23 LTM % Change YOY Revenues $40.3 $27.6 (32%) $141.7 $118.0 (17%) Expenses (22.6) (15.3) (80.7) (66.4) Adjusted EBITDA $17.7 $12.3 (30%) $61.0 $51.5 (16%) Interest & Other Expenses (7.1) (6.2) (25.9) (25.4) Maintenance Capex (2.6) (0.9) (6.4) (5.7) AFF
Slide 20: Consistent Investment Management Growth
20 $275M Run Rate Fee Revenue CONSISTENT INVESTMENT MANAGEMENT GROWTH Note: There can be no assurance that actual amounts will not be materially higher or lower than these expectations. Readers should refer to the discussion in the Cautionary Statement Regarding Forward-Looking Statements section at
Slide 21: Balance Sheet Profile
21 BALANCE SHEET PROFILE Assets GP Investment in DBP Series $294 GP Investments in Other DBRG Offerings (Credit, Core, Infrabridge, Liquid, Ventures) 324 GP Investment Total $618 Operating Net Carrying Value(1) 490 Corporate Cash 205 Key Corporate Assets $1,313 Current Liquidity (Corporate Cash + VF
Slide 22: Executing the Digital Playbook: Early Impacts of Generative AI
22 3 EXECUTING THE DIGITAL PLAYBOOK EARLY IMPACTS OF GENERATIVE AI
Slide 23: Generative AI: It's Fundamentally Different
23 GENERATIVE AI: ITS FUNDAMENTALLY DIFFERENT Generative AI infuses new layers of creativity into Traditional ‘analysis-centric’ AI, unlocking new capabilities Why it matters to DBRG?…Enterprise Software Platforms are being Rearchitected to Incorporate Generative AI Creativity Enhancements = More Co
Slide 24: Generative AI Adoption Is the Fastest on Record
24 “ DigitalBridge Data Center Portfolio CEO This could be as big or bigger than the cloud “ GENERATIVE AI ADOPTION IS THE FASTEST ON RECORD ChatGPT represented ‘iPhone Moment’ for generative AI Sources: IBM Global AI Adoption Index 2022, IDC Worldwide Artificial Intelligence Spending Guide ~$300B(1
Slide 25: Generative AI Workloads Are Power Hungry
25 1,250 1,000 750 500 250 0 2016 2018 2020 2022 2024 TOASTER NVDA P100 NVDA V100 NVDA A100 NVDA H100 INTC PONTE VECCHIO C H IP P O W E R [ W ] 1000B 100B 10B 1B 0.1B 0.01B 2018 2019 2020 2021 2022 2023 ELMo (94M) BERT-Large (340M) GPT-2 (1.5B) T5 (11B) Megatron-LM (8.3B) Turing-NLG (17.2B) GPT-3 (1
Slide 26: Cloud-Trained: Gen AI Is Power Hungry
26 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. LOWER PRICE PER KW Access to Low-Cost Power is Priority LOWER COST HIGHER COST HIGH
Slide 27: Edge Delivered: Intelligence Lives Across the Network
27 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, latenc
Slide 28: Cloud Trained/Edge Delivered: DBRG Portfolio Positioned for AI Demand
28 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
Slide 29: DigitalBridge Is at the Intersection of AI Supply and Demand
29 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. REPORTS FROM THE FIELD
Slide 30: 2023 CEO Priorities: Things That Matter
30 2023 CEO PRIORITIES: 3 THINGS THAT MATTER CEO 2023 Checklist Secular Tailwinds Around Connectivity – Big Growing TAM The Leading Management Team 25+ years Investing and Operating Digital Assets Converged Vision with Exposure to Entire Digital Ecosystem Focus on realization of high-growth digital
Slide 31: Q&A Session
DIGITALBRIDGE Q&A SESSION
Slide 32: Appendix
32 5 APPENDIX
Slide 33: Non-GAAP Reconciliations
33 NON-GAAP RECONCILIATIONS ($ 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 noncontrolling common interests in Oper
Slide 34: Non-GAAP Reconciliations
34 NON-GAAP RECONCILIATIONS ($ 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 Investment expense, net of reim
Slide 35: Balance Sheet
35 BALANCE SHEET ($ in thousands, except per share data) (unaudited) As of June 30, 2023 Consol idated Assets 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 assets 6
Slide 36: cart vat
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