Company: DBRG
Filing Date: 2025-08-08
Form Type: 10-Q
Source: 0001679688-25-000084
Chunk: 100

Company: DigitalBridge Group, Inc.
Filing Date: 2025-08-08
Form: 10-Q
Item: Item 3
Chunk 100
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 vehicle relative to its return threshold, the performance measurement period used to calculate incentives and carried interest, and the stage of the vehicle's lifecycle.  

A hypothetical 10% decline in the fair value of fund investments at June 30, 2025 would decrease carried interest by approximately $166 million, representing the OP's share of carried interest net of allocations to employees, former employees and a third party interest. 

Generally, our incentive fees are recognized when it is probable that a significant reversal of the cumulative incentive fees will not occur, which is typically when the fees become realizable or realized at the end of the performance measurement period. At June 30, 2025, there were no incentive fees recorded that have not been fully realized.

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Foreign Currency Risk

As of June 30, 2025, we have limited direct foreign currency exposure from our foreign operations and foreign currency denominated investments warehoused on the balance sheet for future sponsored vehicles. Changes in foreign currency rates can adversely affect earnings and the value of our foreign currency denominated investments, including investments in our foreign subsidiaries.

We have exposure to foreign currency risk from the operations of our foreign subsidiaries to the extent these subsidiaries do not transact in U.S. dollars. Generally, this is limited to our InfraBridge advisor subsidiary which receives fee revenue predominantly in U.S. dollars but incur operating costs in Pound Sterling.

Interest Rate Risk 

Instruments bearing variable interest rates include debt obligations, which are subject to interest rate fluctuations that will affect future cash flows, specifically interest expense. 

Our corporate debt exposure to variable interest rates is limited to our VFN revolver, which had no outstanding balance at June 30, 2025. 

Equity Price Risk

At June 30, 2025, we had $100 million of long positions and $62 million of short positions in marketable equity securities, held by our consolidated sponsored liquid funds. Realized and unrealized gains and losses from marketable equity securities are recorded in other gain (loss) on the consolidated statement of operations. Market prices for publicly traded equity securities may fluctuate due to a myriad of factors, including but not limited to, financial performance of the investee, industry conditions, economic and political environment, trade volume, and general sentiments in the equity markets. Therefore the level of volatility and price fluctuations are unpredictable. Our funds constantly rebalance their investment portfolio to take advantage of market opportunities and to manage risk. Additionally, one of our funds employs a long/short equity strategy