Jefferies Announces Third Quarter 2025 Financial Results
NEW YORK--( BUSINESS WIRE)--Jefferies Financial Group Inc. (NYSE: JEF):
Q3 Financial Highlights
$ in thousands, except per share amounts
Quarter End
Year-to-Date
3Q25
3Q24
2025
2024
Net earnings attributable to common shareholders
$
223,986
$
167,128
$
439,912
$
462,719
Diluted earnings per common share from continuing operations
$
1.01
$
0.72
$
1.98
$
2.06
Return on adjusted tangible shareholders' equity from continuing operations 1
13.6
%
10.3
%
9.3
%
10.0
%
Total net revenues
$
2,047,432
$
1,683,552
$
5,274,898
$
5,078,200
Investment banking net revenues 14
$
1,135,325
$
943,566
$
2,602,324
$
2,457,963
Capital markets net revenues 14
$
723,382
$
676,525
$
2,125,821
$
2,107,863
Asset management net revenues
$
176,882
$
59,012
$
523,218
$
488,919
Pre-tax earnings from continuing operations
$
331,815
$
252,687
$
617,781
$
700,683
Book value per common share
$
50.60
$
48.89
$
50.60
$
48.89
Adjusted tangible book value per fully diluted share 3
$
33.38
$
31.87
$
33.38
$
31.87
Quarterly Cash Dividend
The Jefferies Board of Directors declared a quarterly cash dividend equal to $0.40 per Jefferies common share, payable on November 26, 2025 to record holders of Jefferies common shares on November 17, 2025.
Management Comments
"Net revenues of $2.05 billion for the third quarter reflect continued growth in our market position amid a strengthening environment for our services. Our Investment Banking Advisory business delivered record quarterly results, driven by increased market share, the continued realization of our ongoing investments in human capital around the globe, and an improvement in the environment for mergers and acquisitions and capital formation. This growth plus strong results in Equities and an improved performance in Asset Management, helped drive net earnings attributable to common shareholders of $224 million and return on adjusted tangible shareholders' equity of 13.6%.
"We are encouraged by the rebound in global market sentiment and believe Jefferies is more strongly positioned than ever—with talent, global reach, product and service offerings, client relationships, joint venture partners and brand—to deliver exceptional long-term value to our clients and shareholders. While the world will remain volatile and full of challenges, we are increasingly optimistic about the near and long-term outlook for Jefferies."
Richard Handler, CEO, and Brian Friedman, President
Financial Summary (Unaudited)
$ in thousands
Three Months Ended
Nine Months Ended
August 31,
2025
May 31,
2025
August 31,
2024
August 31,
2025
August 31,
2024
Net revenues by source:
Advisory
$
655,578
$
457,860
$
592,462
$
1,511,218
$
1,214,927
Equity underwriting
181,205
122,366
150,096
432,091
608,586
Debt underwriting
249,525
205,363
183,078
654,250
517,771
Other investment banking 14
49,017
(19,282
)
17,930
4,765
116,679
Total Investment Banking
1,135,325
766,307
943,566
2,602,324
2,457,963
Equities 14
486,695
526,244
387,342
1,421,997
1,182,025
Fixed income
236,687
177,911
289,183
703,824
925,838
Total Capital Markets
723,382
704,155
676,525
2,125,821
2,107,863
Total Investment Banking and Capital Markets Net revenues 5
1,858,707
1,470,462
1,620,091
4,728,145
4,565,826
Asset management fees and revenues 6
15,916
20,766
13,261
125,312
89,736
Investment return
68,026
50,404
(40,135
)
112,796
110,447
Allocated net interest 4
(18,550
)
(19,144
)
(16,016
)
(54,915
)
(47,031
)
Other investments, inclusive of net interest 13
111,490
102,595
101,902
340,025
335,767
Total Asset Management Net revenues
176,882
154,621
59,012
523,218
488,919
Other
11,843
9,364
4,449
23,535
23,455
Total Net revenues by source
$
2,047,432
$
1,634,447
$
1,683,552
$
5,274,898
$
5,078,200
Non-interest expenses:
Compensation and benefits
$
1,083,510
$
854,839
$
889,098
$
2,779,476
$
2,677,962
Compensation ratio 15
52.9
%
52.3
%
52.8
%
52.7
%
52.7
%
Non-compensation expenses
$
632,107
$
644,707
$
541,767
$
1,877,641
$
1,699,555
Non-compensation ratio 15
30.9
%
39.4
%
32.2
%
35.6
%
33.5
%
Total Non-interest expenses
$
1,715,617
$
1,499,546
$
1,430,865
$
4,657,117
$
4,377,517
Net earnings from continuing operations before income taxes
$
331,815
$
134,901
$
252,687
$
617,781
$
700,683
Income tax expense
$
89,311
$
43,506
$
78,011
$
147,033
$
207,077
Income tax rate
26.9
%
32.3
%
30.9
%
23.8
%
29.6
%
Net earnings from continuing operations
$
242,504
$
91,395
$
174,676
$
470,748
$
493,606
Net earnings (losses) from discontinued operations, net of income taxes
—
—
6,363
—
(1,488
)
Net losses attributable to noncontrolling interests
(10,041
)
(7,668
)
(6,874
)
(24,692
)
(19,102
)
Preferred stock dividends
28,559
11,046
20,785
55,528
48,501
Net earnings attributable to common shareholders
$
223,986
$
88,017
$
167,128
$
439,912
$
462,719
Highlights
Nine Months Ended August 31, 2025 Versus August 31, 2024
Investment Banking and Capital Markets
Investment Banking and Capital Markets
Asset Management
Asset Management
Non-interest Expenses
Non-interest Expenses
Amounts herein pertaining to August 31, 2025 represent a preliminary estimate as of the date of this earnings release and may be revised upon filing our Quarterly Report on Form 10-Q with the Securities and Exchange Commission (“SEC”). More information on our results of operations for the three and nine months ended August 31, 2025 will be provided upon filing our Quarterly Report on Form 10-Q with the SEC, which we expect to file on or about October 9, 2025.
This press release contains certain “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on current views and include statements about our future and statements that are not historical facts. These forward-looking statements are usually preceded by the words “should,” “expect,” “intend,” “may,” “will,” "would," or similar expressions. Forward-looking statements may contain expectations regarding revenues, earnings, operations, and other results, and may include statements of future performance, plans, and objectives. Forward-looking statements may also include statements pertaining to our strategies for future development of our businesses and products. Forward-looking statements represent only our belief regarding future events, many of which by their nature are inherently uncertain. It is possible that the actual results may differ, possibly materially, from the anticipated results indicated in these forward-looking statements. Information regarding important factors, including Risk Factors that could cause actual results to differ, perhaps materially, from those in our forward-looking statements is contained in reports we file with the SEC. You should read and interpret any forward-looking statement together with reports we file with the SEC. We undertake no obligation to update or revise any such forward-looking statement to reflect subsequent circumstances.
Past performance may not be indicative of future results. Different types of investments involve varying degrees of risk. Therefore, it should not be assumed that future performance of any specific investment or investment strategy will be profitable or equal the corresponding indicated performance level(s).
Consolidated Statements of Earnings (Unaudited)
$ in thousands, except per share amounts
Three Months Ended August 31,
Nine Months Ended August 31,
2025
2024
2025
2024
Revenues
Investment banking
$
1,088,197
$
927,094
$
2,606,976
$
2,344,743
Principal transactions
486,893
324,501
1,232,630
1,381,432
Commissions and other fees
325,178
270,643
966,711
787,968
Asset management fees and revenues
13,079
11,986
118,563
74,126
Interest
846,894
936,786
2,570,090
2,636,002
Other
147,433
124,579
379,883
439,556
Total revenues
2,907,674
2,595,589
7,874,853
7,663,827
Interest expense
860,242
912,037
2,599,955
2,585,627
Net revenues
2,047,432
1,683,552
5,274,898
5,078,200
Non-interest expenses
Compensation and benefits
1,083,510
889,098
2,779,476
2,677,962
Brokerage and clearing fees
121,164
101,119
360,345
321,325
Underwriting costs
20,332
14,017
52,703
51,053
Technology and communications
157,171
136,953
442,844
409,703
Occupancy and equipment rental
32,908
30,078
93,818
87,558
Business development
78,999
68,152
231,360
194,433
Professional services
73,329
64,630
223,563
217,967
Depreciation and amortization
53,230
45,977
136,471
139,125
Cost of sales
34,430
37,400
118,959
109,533
Other expenses
60,544
43,441
217,578
168,858
Total non-interest expenses
1,715,617
1,430,865
4,657,117
4,377,517
Earnings from continuing operations before income taxes
331,815
252,687
617,781
700,683
Income tax expense
89,311
78,011
147,033
207,077
Net earnings from continuing operations
242,504
174,676
470,748
493,606
Net earnings (losses) from discontinued operations (including gain on disposal), net of income taxes
—
6,363
—
(1,488
)
Net earnings
242,504
181,039
470,748
492,118
Net losses attributable to noncontrolling interests
(10,041
)
(6,874
)
(24,692
)
(19,102
)
Preferred stock dividends
28,559
20,785
55,528
48,501
Net earnings attributable to common shareholders
$
223,986
$
167,128
$
439,912
$
462,719
Financial Data and Metrics (Unaudited)
Three Months Ended
Nine Months Ended
August 31,
2025
May 31,
2025
August 31,
2024
August 31,
2025
August 31,
2024
Other Data:
Number of trading days
63
63
63
187
188
Number of trading loss days 7
3
13
7
20
11
Average VaR (in millions) 8
$
10.45
$
11.89
$
11.35
$
11.81
$
13.26
In millions, except other data
August 31,
2025
May 31,
2025
August 31,
2024
Financial position:
Total assets
$
69,320
$
67,285
$
63,275
Cash and cash equivalents
11,458
11,260
10,573
Financial instruments owned
26,117
25,570
24,039
Level 3 financial instruments owned 9
803
763
693
Goodwill and intangible assets, net
2,052
2,060
2,073
Total equity
10,501
10,382
10,115
Total shareholders' equity
10,439
10,305
10,046
Tangible shareholders' equity 10
8,387
8,245
7,973
Other data and financial ratios:
Leverage ratio 11
6.6
6.5
6.3
Tangible gross leverage ratio 12
8.0
7.9
7.7
Number of employees at period end
7,866
7,671
7,624
Number of employees excluding Tessellis and Stratos at period end
6,206
5,949
5,926
Components of Numerators and Denominators for Earnings Per Common Share
$ in thousands, except per share amounts
Three Months Ended
August 31,
Nine Months Ended
August 31,
2025
2024
2025
2024
Numerator for earnings per common share from continuing operations:
Net earnings from continuing operations
$
242,504
$
174,676
$
470,748
$
493,606
Less: Net losses attributable to noncontrolling interests
(10,041
)
(6,304
)
(24,692
)
(16,541
)
Allocation of earnings to participating securities
(28,559
)
(20,785
)
(55,528
)
(48,501
)
Net earnings from continuing operations attributable to common shareholders for basic earnings per share
$
223,986
$
160,195
$
439,912
$
461,646
Net earnings from continuing operations attributable to common shareholders for diluted earnings per share
$
223,986
$
160,195
$
439,912
$
461,646
Numerator for earnings per common share from discontinued operations:
Net earnings (losses) from discontinued operations, net of taxes
$
—
$
6,363
$
—
$
(1,488
)
Less: Net losses attributable to noncontrolling interests
—
(570
)
—
(2,561
)
Net earnings from discontinued operations attributable to common shareholders for basic and diluted earnings per share
$
—
$
6,933
$
—
$
1,073
Net earnings attributable to common shareholders for basic earnings per share
$
223,986
$
167,128
$
439,912
$
462,719
Net earnings attributable to common shareholders for diluted earnings per share
$
223,986
$
167,128
$
439,912
$
462,719
Denominator for earnings per common share:
Weighted average common shares outstanding
206,272
206,418
206,191
209,997
Weighted average shares of restricted stock outstanding with future service required
(2,224
)
(2,305
)
(2,259
)
(2,346
)
Weighted average restricted stock units outstanding with no future service required
11,245
10,339
11,045
10,455
Weighted average basic common shares
215,293
214,452
214,977
218,106
Stock options and other share-based awards
4,643
4,189
4,915
3,369
Senior executive compensation plan restricted stock unit awards
2,779
3,058
2,647
2,705
Weighted average diluted common shares
222,715
221,699
222,539
224,180
Earnings per common share:
Basic from continuing operations
$
1.04
$
0.75
$
2.05
$
2.12
Basic from discontinued operations
—
0.03
—
—
Basic
$
1.04
$
0.78
$
2.05
$
2.12
Diluted from continuing operations
$
1.01
$
0.72
$
1.98
$
2.06
Diluted from discontinued operations
—
0.03
—
—
Diluted
$
1.01
$
0.75
$
1.98
$
2.06
Non-GAAP Reconciliations
The following tables reconcile our non-GAAP financial measures to their respective U.S. GAAP financial measures. Management believes such non-GAAP financial measures are useful to investors as they allow them to view our results through the eyes of management, while facilitating a comparison across historical periods. These measures should not be considered a substitute for, or superior to, measures prepared in accordance with U.S. GAAP.
Return on Adjusted Tangible Equity Reconciliation
$ in thousands
Three Months Ended
August 31,
Nine Months Ended
August 31,
2025
2024
2025
2024
Net earnings attributable to common shareholders (GAAP)
$
223,986
$
167,128
$
439,912
$
462,719
Intangible amortization and impairment expense, net of tax
9,163
5,958
22,053
15,900
Adjusted net earnings to common shareholders (non-GAAP)
233,149
173,086
461,965
478,619
Preferred stock dividends
28,559
20,785
55,528
48,501
Adjusted net earnings to total shareholders (non-GAAP)
$
261,708
$
193,871
$
517,493
$
527,120
Adjusted net earnings to total shareholders (non-GAAP) 1
$
1,046,832
$
775,484
$
689,991
$
702,827
Net earnings impact for net (earnings) losses from discontinued operations, net of noncontrolling interests
—
(6,933
)
—
(1,073
)
Adjusted net earnings to total shareholders from continuing operations (non-GAAP)
261,708
186,938
517,493
526,047
Adjusted net earnings to total shareholders from continuing operations (non-GAAP) 1
1,046,832
747,752
689,991
701,396
May 31,
November 30,
2025
2024
2024
2023
Shareholders' equity (GAAP)
$
10,305,025
$
9,875,056
$
10,156,772
$
9,709,827
Less: Intangible assets, net and goodwill
(2,060,019
)
(2,057,302
)
(2,054,310
)
(2,044,776
)
Less: Deferred tax asset, net
(502,033
)
(512,042
)
(497,590
)
(458,343
)
Less: Weighted average impact of dividends and share repurchases
(66,561
)
(57,836
)
(208,901
)
(157,739
)
Adjusted tangible shareholders' equity (non-GAAP)
$
7,676,412
$
7,247,876
$
7,395,971
$
7,048,969
Return on adjusted tangible shareholders' equity (non-GAAP) 1
13.6
%
10.7
%
9.3
%
10.0
%
Return on adjusted tangible shareholders' equity from continuing operations (non-GAAP) 1
13.6
%
10.3
%
9.3
%
10.0
%
Adjusted Tangible Book Value and Fully Diluted Shares Outstanding Reconciliation
Reconciliation of book value (shareholders' equity) to adjusted tangible book value and common shares outstanding to fully diluted shares outstanding:
$ in thousands, except per share amounts
August 31, 2025
Book value (GAAP)
$
10,438,724
Stock options (1)
114,939
Intangible assets, net and goodwill
(2,052,740
)
Adjusted tangible book value (non-GAAP)
$
8,500,923
Common shares outstanding (GAAP)
206,280
Preferred shares
27,563
Restricted stock units ("RSUs")
14,214
Stock options (1)
5,065
Other
1,587
Adjusted fully diluted shares outstanding (non-GAAP) (2)
254,709
Book value per common share outstanding
$
50.60
Adjusted tangible book value per fully diluted share outstanding (non-GAAP)
$
33.38
(1)
Stock options added to book value are equal to the total number of stock options outstanding as of August 31, 2025 of 5.1 million multiplied by the weighted average exercise price of $22.69 on August 31, 2025.
(2)
Fully diluted shares outstanding include vested and unvested RSUs as well as the target number of RSUs issuable under the senior executive compensation plans until the performance period is complete. Fully diluted shares outstanding also include all stock options and the impact of convertible preferred shares if-converted to common shares.
Notes
1.
Return on adjusted tangible shareholders' equity and Return on adjusted tangible shareholders' equity from continuing operations represent non-GAAP financial measures and are based on full year or annualized amounts. Refer to schedule on page 8 for a reconciliation to U.S. GAAP amounts.
2.
Shares outstanding on a fully diluted basis (a non-GAAP financial measure) is defined as common shares outstanding plus preferred shares, restricted stock units, stock options and other shares. Refer to schedule on page 9 for a reconciliation to U.S. GAAP amounts.
3.
Adjusted tangible book value per fully diluted share (a non-GAAP financial measure) is defined as adjusted tangible book value (a non-GAAP financial measure) divided by shares outstanding on a fully diluted basis (a non-GAAP financial measure). Refer to schedule on page 9 for a reconciliation to U.S. GAAP amounts.
4.
Allocated net interest represents an allocation to Asset Management of certain of our long-term debt interest expense, net of interest income on our Cash and cash equivalents and other sources of liquidity. Allocated net interest has been disaggregated to increase transparency and to present direct Asset Management revenues. We believe that aggregating Allocated net interest would obscure the revenue results by including an amount that is unique to our credit spreads, debt maturity profile, capital structure, liquidity risks and allocation methods.
5.
Allocated net interest is not separately disaggregated for Investment Banking and Capital Markets. This presentation is aligned to our Investment Banking and Capital Markets internal performance measurement.
6.
Asset management fees and revenues include management and performance fees from funds and accounts managed by us as well as our share of fees received by affiliated asset management companies with which we have revenue and profit share arrangements, as well as earnings on our ownership interest in affiliated asset managers.
7.
Number of trading loss days is calculated based on trading activities in our Investment Banking and Capital Markets and Asset Management business segments, excluding certain Other investments.
8.
VaR estimates the potential loss in value of trading positions due to adverse market movements over a one-day time horizon with a 95% confidence level. For a further discussion of the calculation of VaR, see "Value-at-Risk" in Part II, Item 7A "Quantitative and Qualitative Disclosures About Market Risk" in our Annual Report on Form 10-K for the year ended November 30, 2024.
9.
Level 3 financial instruments represent those financial instruments classified as such under Accounting Standards Codification 820, accounted for at fair value and included within Financial instruments owned.
10.
Tangible shareholders' equity (a non-GAAP financial measure) is defined as shareholders' equity less Intangible assets and goodwill. We believe that tangible shareholders' equity is meaningful for valuation purposes, as financial companies are often measured as a multiple of tangible shareholders' equity, making these ratios meaningful for investors.
11.
Leverage ratio equals total assets divided by total equity.
12.
Tangible gross leverage ratio (a non-GAAP financial measure) equals total assets less goodwill and intangible assets divided by tangible shareholders' equity. The tangible gross leverage ratio is used by rating agencies in assessing our leverage ratio.
13.
Beginning in fiscal 2024, we now refer to "Merchant banking" as “Other investments” in our Asset Management reportable segment.
14.
Beginning in the fourth quarter of 2024, revenues from corporate equity derivative transactions historically included within Other investment banking net revenues were reclassified to Equities net revenues as the underlying business has matured and has started to generate meaningful revenues. Prior year amounts have been revised to conform to this reclassification change to the current year reporting.
15.
Compensation ratio equals total compensation expense divided by total net revenues. Non-compensation ratio equals total non-compensation expense divided by total net revenues.
Source: Jefferies Financial Group Inc.