Jefferies Announces Third Quarter 2025 Financial Results

9/29/25 4:15:00 PM ET

$JEF

Investment Bankers/Brokers/Service

Finance

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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 operations¹		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 revenues¹⁴	$	1,135,325		$	943,566		$	2,602,324		$	2,457,963
Capital markets net revenues¹⁴	$	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 share³	$	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 banking¹⁴		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
Equities¹⁴		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 revenues⁵		1,858,707			1,470,462			1,620,091			4,728,145			4,565,826
Asset management fees and revenues⁶		15,916			20,766			13,261			125,312			89,736
Investment return		68,026			50,404			(40,135	)		112,796			110,447
Allocated net interest⁴		(18,550	)		(19,144	)		(16,016	)		(54,915	)		(47,031	)
Other investments, inclusive of net interest¹³		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 ratio¹⁵		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 ratio¹⁵		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

Three Months Ended August 31, 2025 Versus August 31, 2024		Nine Months Ended August 31, 2025 Versus August 31, 2024
Net earnings attributable to common shareholders of $224 million, or $1.01 per diluted common share from continuing operations. Return on adjusted tangible shareholders' equity from continuing operations¹ of 13.6%. We had 206.3 million common shares outstanding and 254.7 million common shares outstanding on a fully diluted basis² at August 31, 2025. Our book value per common share was $50.60 and adjusted tangible book value per fully diluted share³ was $33.38. Effective tax rate from continuing operations of 26.9% compared to 30.9% for the prior year quarter. The lower rate was primarily driven by the resolution of certain state and local tax matters.		Net earnings attributable to common shareholders of $440 million, or $1.98 per diluted common share from continuing operations. Return on adjusted tangible shareholders' equity from continuing operations¹ of 9.3%. Repurchased 0.7 million shares of common stock for $58 million, at an average price of $79.58 per share in connection with net-share settlements related to our equity compensation plans. Effective tax rate from continuing operations of 23.8% compared to 29.6% for the prior year period. The lower rate was primarily driven by the resolution of certain state and local tax matters.

Investment Banking and Capital Markets		Investment Banking and Capital Markets
Investment Banking net revenues from Advisory, Equity underwriting and Debt underwriting totaling $1.09 billion were 17% higher than the prior year quarter. Advisory net revenues of $656 million reflects our best quarter ever and were higher than the prior year quarter, driven by increased deal values in mergers and acquisitions across most sectors as market conditions improved. Underwriting net revenues of $431 million were higher than the prior year quarter, as market conditions for Equity and Debt underwriting improved, leading to increased activity levels. Capital Markets net revenues of $723 million were higher compared to the prior year quarter. Equities net revenues increased from the prior year quarter, as higher global volumes drove stronger results, particularly within our U.S. and Europe equity cash business. Additionally, our equity options, corporate derivatives and global electronic trading businesses also produced strong results. Fixed Income net revenues decreased from the prior year quarter as strong results from our global structured products were offset by lower results in our client flow trading businesses as tight credit conditions continued to slow activity levels.		Investment Banking net revenues from Advisory, Equity underwriting and Debt underwriting totaling $2.60 billion were 11% higher than the prior year period. Other investment banking net revenues were $5 million, compared to net revenues of $117 million for the prior year period in part due to the prior year period including Foursight operating revenues as well as the impact of the gain on sale as Foursight was sold in April 2024, and lower performance from Jefferies Finance. Advisory net revenues of $1.51 billion were higher than the prior year period, driven by market share gains and increased mergers and acquisition activity levels across most sectors. Underwriting net revenues of $1.09 billion were lower than the prior year period, as stronger net revenues in Debt underwriting attributable to the increase in transaction activity across most sectors were offset by lower net revenues in Equity underwriting, consistent with the overall industry slowdown in the first-half of 2025. Capital Markets net revenues of $2.13 billion were modestly higher compared to the prior year period. Equities net revenues were strong for the current year attributable to market share gains and overall increased levels of activity during the period. Fixed Income net revenues decreased from the prior year period due to lower global activity levels and volatility in credit spreads for the first-half of 2025 meaningfully impacting the overall trading environment.

Asset Management		Asset Management
Asset Management fees and revenues and investment return of $84 million were higher than the prior year quarter. Asset management fees and revenues modestly increased, driven by higher management and performance fees realized during the current quarter. Investment return meaningfully increased due to improved performance across several fund strategies, particularly those with a long equity bias.		Asset Management fees and revenues and investment return of $238 million were higher than the prior year period. Asset management fees and revenues were higher compared to the prior year period, primarily reflecting higher performance fees on funds managed by us and through our strategic affiliates. Investment return was modestly higher compared to the prior year period.

Non-interest Expenses		Non-interest Expenses
Compensation and benefits expense as a percentage of Net revenues was 52.9%, compared to 52.8% for the prior year quarter. Non-compensation expenses were higher primarily due to increased brokerage and clearing fees associated with increased equities trading volumes, and increased technology and communication and business development expenses. Non-compensation expenses as a percentage of Net revenues declined to 30.9%, compared to 32.2% for the prior year quarter.		Compensation and benefits expense as a percentage of Net revenues was 52.7%, flat with the prior year period. Non-compensation expenses were higher primarily due to increased brokerage and clearing fees associated with increased equities trading volumes, increased higher technology and communication and business development expenses. The current year also includes approximately $17 million in charitable donations, including $10 million to support Los Angeles wildfire relief efforts, while the prior year period includes the impact of $27 million in bad debt expenses associated with the shutdown of Weiss Multi-Strategy Advisers. In addition, non-compensation expenses for the prior year period include Foursight activity up through the sale in April 2024.

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 days⁷		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 owned⁹		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' equity¹⁰		8,387		8,245		7,973
Other data and financial ratios:
Leverage ratio¹¹		6.6		6.5		6.3
Tangible gross leverage ratio¹²		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.

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Jonathan Freedman 212.778.8913

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$JEF

Date	Price Target	Rating	Analyst
4/7/2025	$75.00 → $41.00	Overweight → Equal-Weight	Morgan Stanley
3/19/2025		Outperform → Perform	Oppenheimer
12/9/2024	$67.00 → $97.00	Equal-Weight → Overweight	Morgan Stanley
9/17/2024	$67.00	Buy	UBS
8/22/2023	$37.00 → $40.00	Neutral → Buy	Goldman
7/12/2023	$27.00 → $36.00	Underweight → Equal-Weight	Morgan Stanley
4/12/2023	$28.00 → $27.00	Equal-Weight → Underweight	Morgan Stanley
1/11/2023	$40.00	Buy → Neutral	Goldman

More analyst ratings

Jefferies Announces Third Quarter 2025 Financial Results

9/29/25 4:15:00 PM ET

$JEF

Investment Bankers/Brokers/Service

Finance

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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 operations¹		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 revenues¹⁴	$	1,135,325		$	943,566		$	2,602,324		$	2,457,963
Capital markets net revenues¹⁴	$	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 share³	$	33.38		$	31.87		$	33.38		$	31.87

Quarterly Cash Dividend

Management Comments

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 banking¹⁴		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
Equities¹⁴		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 revenues⁵		1,858,707			1,470,462			1,620,091			4,728,145			4,565,826
Asset management fees and revenues⁶		15,916			20,766			13,261			125,312			89,736
Investment return		68,026			50,404			(40,135	)		112,796			110,447
Allocated net interest⁴		(18,550	)		(19,144	)		(16,016	)		(54,915	)		(47,031	)
Other investments, inclusive of net interest¹³		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 ratio¹⁵		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 ratio¹⁵		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

Three Months Ended August 31, 2025 Versus August 31, 2024		Nine Months Ended August 31, 2025 Versus August 31, 2024
Net earnings attributable to common shareholders of $224 million, or $1.01 per diluted common share from continuing operations. Return on adjusted tangible shareholders' equity from continuing operations¹ of 13.6%. We had 206.3 million common shares outstanding and 254.7 million common shares outstanding on a fully diluted basis² at August 31, 2025. Our book value per common share was $50.60 and adjusted tangible book value per fully diluted share³ was $33.38. Effective tax rate from continuing operations of 26.9% compared to 30.9% for the prior year quarter. The lower rate was primarily driven by the resolution of certain state and local tax matters.		Net earnings attributable to common shareholders of $440 million, or $1.98 per diluted common share from continuing operations. Return on adjusted tangible shareholders' equity from continuing operations¹ of 9.3%. Repurchased 0.7 million shares of common stock for $58 million, at an average price of $79.58 per share in connection with net-share settlements related to our equity compensation plans. Effective tax rate from continuing operations of 23.8% compared to 29.6% for the prior year period. The lower rate was primarily driven by the resolution of certain state and local tax matters.

Investment Banking and Capital Markets		Investment Banking and Capital Markets
Investment Banking net revenues from Advisory, Equity underwriting and Debt underwriting totaling $1.09 billion were 17% higher than the prior year quarter. Advisory net revenues of $656 million reflects our best quarter ever and were higher than the prior year quarter, driven by increased deal values in mergers and acquisitions across most sectors as market conditions improved. Underwriting net revenues of $431 million were higher than the prior year quarter, as market conditions for Equity and Debt underwriting improved, leading to increased activity levels. Capital Markets net revenues of $723 million were higher compared to the prior year quarter. Equities net revenues increased from the prior year quarter, as higher global volumes drove stronger results, particularly within our U.S. and Europe equity cash business. Additionally, our equity options, corporate derivatives and global electronic trading businesses also produced strong results. Fixed Income net revenues decreased from the prior year quarter as strong results from our global structured products were offset by lower results in our client flow trading businesses as tight credit conditions continued to slow activity levels.		Investment Banking net revenues from Advisory, Equity underwriting and Debt underwriting totaling $2.60 billion were 11% higher than the prior year period. Other investment banking net revenues were $5 million, compared to net revenues of $117 million for the prior year period in part due to the prior year period including Foursight operating revenues as well as the impact of the gain on sale as Foursight was sold in April 2024, and lower performance from Jefferies Finance. Advisory net revenues of $1.51 billion were higher than the prior year period, driven by market share gains and increased mergers and acquisition activity levels across most sectors. Underwriting net revenues of $1.09 billion were lower than the prior year period, as stronger net revenues in Debt underwriting attributable to the increase in transaction activity across most sectors were offset by lower net revenues in Equity underwriting, consistent with the overall industry slowdown in the first-half of 2025. Capital Markets net revenues of $2.13 billion were modestly higher compared to the prior year period. Equities net revenues were strong for the current year attributable to market share gains and overall increased levels of activity during the period. Fixed Income net revenues decreased from the prior year period due to lower global activity levels and volatility in credit spreads for the first-half of 2025 meaningfully impacting the overall trading environment.

Asset Management		Asset Management
Asset Management fees and revenues and investment return of $84 million were higher than the prior year quarter. Asset management fees and revenues modestly increased, driven by higher management and performance fees realized during the current quarter. Investment return meaningfully increased due to improved performance across several fund strategies, particularly those with a long equity bias.		Asset Management fees and revenues and investment return of $238 million were higher than the prior year period. Asset management fees and revenues were higher compared to the prior year period, primarily reflecting higher performance fees on funds managed by us and through our strategic affiliates. Investment return was modestly higher compared to the prior year period.

Non-interest Expenses		Non-interest Expenses
Compensation and benefits expense as a percentage of Net revenues was 52.9%, compared to 52.8% for the prior year quarter. Non-compensation expenses were higher primarily due to increased brokerage and clearing fees associated with increased equities trading volumes, and increased technology and communication and business development expenses. Non-compensation expenses as a percentage of Net revenues declined to 30.9%, compared to 32.2% for the prior year quarter.		Compensation and benefits expense as a percentage of Net revenues was 52.7%, flat with the prior year period. Non-compensation expenses were higher primarily due to increased brokerage and clearing fees associated with increased equities trading volumes, increased higher technology and communication and business development expenses. The current year also includes approximately $17 million in charitable donations, including $10 million to support Los Angeles wildfire relief efforts, while the prior year period includes the impact of $27 million in bad debt expenses associated with the shutdown of Weiss Multi-Strategy Advisers. In addition, non-compensation expenses for the prior year period include Foursight activity up through the sale in April 2024.

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 days⁷		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 owned⁹		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' equity¹⁰		8,387		8,245		7,973
Other data and financial ratios:
Leverage ratio¹¹		6.6		6.5		6.3
Tangible gross leverage ratio¹²		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

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.

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Jonathan Freedman 212.778.8913

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Recent Analyst Ratings for

$JEF

Date	Price Target	Rating	Analyst
4/7/2025	$75.00 → $41.00	Overweight → Equal-Weight	Morgan Stanley
3/19/2025		Outperform → Perform	Oppenheimer
12/9/2024	$67.00 → $97.00	Equal-Weight → Overweight	Morgan Stanley
9/17/2024	$67.00	Buy	UBS
8/22/2023	$37.00 → $40.00	Neutral → Buy	Goldman
7/12/2023	$27.00 → $36.00	Underweight → Equal-Weight	Morgan Stanley
4/12/2023	$28.00 → $27.00	Equal-Weight → Underweight	Morgan Stanley
1/11/2023	$40.00	Buy → Neutral	Goldman

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