Apollo Global Management Inc. (APOS)

Many software companies are facing significant challenges due to a "double whammy" of AI disruption and higher-for-longer interest rates. AI is eroding the equity value of existing business models, while increased rates strain the debt that financed these companies. This issue is particularly acute given the explosive growth in direct lending to SaaS firms, which leaves a substantial amount of capital exposed to these forces.

Apollo Global Management and Blackstone have spearheaded a $35 billion loan facility backed by AI chips and computing power produced by Broadcom, marking a new trend in financing AI infrastructure. This financing platform, named AI XPV, aims to deliver over 20 gigawatts of computing power by 2028 and treats computing power as an asset to lend against. The initiative highlights a shift towards valuing intangible assets like computing power but also raises concerns about collateral valuation and off-balance-sheet leverage, as warned by regulators.

At its 2026 Annual Meeting, Apollo Global Management's shareholders re-elected all 13 directors for one-year terms, demonstrating strong support for the current board and leadership. Investors also approved executive compensation, opted for annual say-on-pay votes, and ratified Deloitte & Touche LLP as the independent auditor. This reflects broad shareholder backing for Apollo's existing governance, audit, and compensation practices.

Life insurance companies, particularly those owned by private fund managers like KKR's Global Atlantic and Apollo Global Management's Athene, significantly increased their private credit holdings in 2025. U.S. life insurers collectively held $807 billion in private credit and illiquid assets, making up 20% of their fixed-income assets, a rise from $685 billion (18%) in 2024. A substantial portion of these investments are concentrated among 10 major holders, with almost 10% being below investment-grade and 38% in complex asset-backed debt.

This article highlights that the benefits of Artificial Intelligence are not yet widespread, primarily benefiting the "Magnificent 7" companies. The author, Torsten Slok, points out that while revenue per employee and profit margins are rising for these large tech firms, other companies, particularly small-cap ones, are not seeing similar gains. This indicates that rising interest rates and higher yields are negatively impacting companies with weaker credit fundamentals, and AI's positive effects have not yet trickled down to the broader market.