BlackRock Inc's third-quarter profit increased 8 percent as investors sought out the firm's exchange-traded funds despite tough market conditions.

The world's largest asset manager said on Wednesday earnings rose to $595 million, or $3.23 a share, from $551 million, or $2.83 per share, a year earlier.

BlackRock earned $2.83 a share excluding a tax benefit, costs for exiting leases and some compensation plans. On that basis, analysts on average expected $2.63, according to Thomson Reuters I/B/E/S.

Chief Executive Officer Laurence Fink highlighted the firm's 40.1 percent adjusted profit margin, up from 38.4 percent a year earlier, achieved by keeping expenses in check. While revenue increased 6.4 percent to $2.2 billion, expenses grew 4.5 percent to $1.4 billion.

While individual investors withdrew money from many mutual fund companies during the third quarter, BlackRock benefited from its market-leading line up of exchange-traded funds, which took in $10.8 billion for the period. Overall, customers withdrew a net $10.2 billion, including a single, large withdrawal of $9.1 billion from indexed fixed-income accounts.

Hit by the quarter's turbulent markets, assets under management totaled $3.345 trillion, down 9 percent during the quarter and 3 percent from a year earlier.

Shares of BlackRock, which is partially owned by PNC Financial Services Group
and Barclays PLC , gained 3.7 percent to $156.30 on the New York Stock Exchange on Tuesday. The shares are down 18 percent so far this year.

(Reporting by Aaron Pressman; Editing by Lisa Von Ahn and Derek Caney)