Financial Data and Key Metrics Changes - The company reported revenues of $605 million for the first quarter, an 18% increase year-over-year, and adjusted earnings per share of $2.14, up 75% compared to the same quarter last year [5][6][10] - Adjusted compensation expenses were $372 million, up from $316 million in the same period last year, maintaining an adjusted compensation expense ratio of 61.5% [13][14] - Adjusted non-compensation expenses increased to $94 million from $80 million year-over-year, with a non-compensation expense ratio of 15.6% [14][15] Business Line Data and Key Metrics Changes - Corporate Finance generated $399 million in revenue, a 21% increase year-over-year, with 125 transactions closed, up from 116 [6][11] - Financial Restructuring revenues were $128 million, a 9% increase, with 35 transactions closed compared to 33 in the same quarter last year [7][12] - Financial and Valuation Advisory produced $79 million in revenues, a 16% increase, with 957 fee events, up from 847 [8][12] Market Data and Key Metrics Changes - The U.S. market continues to outperform EMEA in terms of revenue and activity levels, with expectations that this trend will persist [11][12][56] - The company noted that while the sponsor activity has been muted, there are signs of improvement expected post-Labor Day [54][55] Company Strategy and Development Direction - The company is focused on maintaining a diversified business model across industries and geographies, which has shown resilience in the current macro environment [6][10] - The company is committed to hiring senior talent and expanding its workforce through both organic growth and strategic acquisitions [9][78] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism regarding the business environment, acknowledging ongoing volatility and uncertainty [61] - The outlook for fiscal year 2026 remains positive, with expectations for continued growth across all business lines [10][19] Other Important Information - The company hosted the inaugural Houlihan Lokey ONE conference, which was well-received, showcasing its global reach and client engagement [9] - The adjusted effective tax rate for the quarter was negative 0.8%, a significant decrease from 31.2% in the same quarter last year, due to changes in stock-based compensation accounting [18][19] Q&A Session Summary Question: Insights on Corporate Finance market improvement - Management noted that while there is improvement quarter by quarter, it is not necessarily consistent month by month, with clients adapting to market conditions [25][26] Question: Backlog trends and sector performance - Management refrained from commenting on backlog specifics but indicated solid performance across sectors, with EMEA lagging behind the U.S. [28][29] Question: Quality of assets and deal activity - Management acknowledged a strong environment but noted that the volume of deals is expected to pick up after Labor Day [33][34] Question: Non-compensation expense growth expectations - Management confirmed expectations for high single-digit growth in non-compensation expenses for the year, despite a higher first quarter [36][37] Question: Restructuring market outlook - Management indicated that both in-court and out-of-court restructuring activities remain strong, with a good pipeline expected to continue [41][42] Question: Growth of the secondaries business - Management expressed satisfaction with the growth of the secondaries business, which is integrated within the Capital Solutions group [44][45] Question: Sponsor market activity post-Labor Day - Management expects an increase in sponsor activity after Labor Day, consistent with broader market trends [54][55] Question: Hiring strategy and focus areas - Management emphasized a commitment to hiring across all sectors, without specific focus areas, driven by growth opportunities [78][80]

Company Overview - Houlihan Lokey has 33 locations worldwide and 2,677 global employees, including 347 managing directors[11] - The firm's revenue reached $2.5 billion for the last twelve months ended June 30, 2025[11] - The average tenure of the Executive Management Team and Operating Committee Team is over 25 years[15] - No single individual generated more than 2% of the firm's revenues[24] Financial Performance - The company experienced strong revenue growth with a five-year Compound Annual Growth Rate (CAGR) of 16%[19] - Adjusted pre-tax income grew at a CAGR of 17% over the same five-year period[19] - For the three months ended June 30, 2025, revenues were $605.349 million compared to $513.609 million for the three months ended June 30, 2024[130] - Adjusted net income for the three months ended June 30, 2025, was $148.005 million, or $2.14 per diluted share, compared to $84.305 million, or $1.22 per diluted share for the three months ended June 30, 2024[130] Business Segments - Corporate Finance generated $1.597 billion in revenue, representing 64% of the total, Financial Restructuring $555 million (23%), and Financial and Valuation Advisory $329 million (13%) for the last twelve months ended June 30, 2025[71] - The Corporate Finance group closed 573 transactions, Financial Restructuring 147, and Financial and Valuation Advisory 2,460 fee events[71] - The company has increased its Managing Director Headcount by a CAGR of 9% over the last 20 years[59]

Group 1 - Houlihan Lokey (NYSE: HLI) operates in the US-listed independent advisor space, which is characterized by a strong focus on mergers and acquisitions (M&A) [1] - The company's business model is divided into three segments: corporate finance (including M&A advisory and capital markets), financial restructuring (covering bankruptcy filings and liability management), and financial & valuation [1]

Core Viewpoint - The market anticipates Houlihan Lokey (HLI) will report a year-over-year increase in earnings driven by higher revenues when it releases its quarterly results for the period ending June 2025 [1] Earnings Expectations - The upcoming earnings report is expected to be released on July 29, with a consensus EPS estimate of $1.69, reflecting a year-over-year increase of +38.5% [3] - Revenues are projected to reach $588.56 million, which is a 14.6% increase from the same quarter last year [3] Estimate Revisions - The consensus EPS estimate has remained unchanged over the last 30 days, indicating stability in analysts' assessments [4] - The Most Accurate Estimate for Houlihan Lokey is higher than the Zacks Consensus Estimate, resulting in a positive Earnings ESP of +6.60%, suggesting a bullish outlook from analysts [12] Earnings Surprise History - In the last reported quarter, Houlihan Lokey exceeded the expected EPS of $1.61 by delivering $1.96, resulting in a surprise of +21.74% [13] - Over the past four quarters, the company has beaten consensus EPS estimates three times [14] Additional Insights - A positive Earnings ESP is a strong indicator of an earnings beat, especially when combined with a Zacks Rank of 1 (Strong Buy), 2 (Buy), or 3 (Hold) [10] - The current Zacks Rank for Houlihan Lokey is 3, indicating a moderate outlook [12]

Have you been searching for a stock that might be well-positioned to maintain its earnings-beat streak in its upcoming report? It is worth considering Houlihan Lokey (HLI) , which belongs to the Zacks Financial - Miscellaneous Services industry.When looking at the last two reports, this investment banking company has recorded a strong streak of surpassing earnings estimates. The company has topped estimates by 15.17%, on average, in the last two quarters.For the most recent quarter, Houlihan Lokey was expec ...

Company Overview - Houlihan Lokey has 36 locations worldwide and 2,707 global employees, including 337 managing directors[12] - The company's revenue reached $2.2 billion[12] - The average tenure of the Executive Management Team and Operating Committee Team is over 25 years[16] - More than 60% of Managing Directors reached their positions through internal promotions[27] - No single individual generated more than 2% of revenues[27] Financial Performance - The company experienced strong revenue growth with a five-year CAGR of 12%[20] - Adjusted pre-tax income grew at a CAGR of 11% over the same five-year period[20] - For the nine months ended December 31, 2024, revenues reached $1.723 billion[122], compared to $1.394 billion for the same period in 2023[122] - Adjusted pre-tax margin for the nine months ended December 31, 2024, was 25.5%[116] Business Segments - Corporate Finance generated $1.402 billion in revenue, representing 62% of the total[74] - Financial Restructuring contributed $535 million, accounting for 24% of the total[74] - Financial and Valuation Advisory brought in $307 million, which is 14% of the total[74]

Core Insights - Houlihan Lokey, Inc. (HLI) shares increased by 5.4% following the release of its fiscal fourth-quarter results on May 7, 2025, driven by growth in corporate finance, financial and valuation advisory, and financial restructuring businesses, although higher expenses partially offset these gains [1] Financial Performance - HLI reported adjusted earnings per share (EPS) of $1.96 for fiscal Q4 2025, exceeding the Zacks Consensus Estimate by 21.7% and reflecting a 54% year-over-year increase [1] - Total revenues for the quarter rose by 28% year over year to $666.4 million, surpassing the Zacks Consensus Estimate by 6.4% [2] - Income before provision for income taxes increased by 27.3% year over year to $150.3 million [3] - Total operating expenses grew by 26.2% year over year to $527.2 million, attributed to higher employee compensation and benefits, as well as non-compensation expenses [3] - The adjusted compensation expense ratio remained stable at 61.5% [3] Segment Performance - Corporate Finance segment revenues surged by 43.5% year over year to $412.7 million, benefiting from improved average transaction fees and an increase in the number of closed transactions, with Managing Directors up by 7.6% and closed transactions up by 21.5% [3] - Financial Restructuring revenues improved by 5.9% year over year, supported by an increase in closed transactions and average transaction fees, with Managing Directors and closed transactions rising by 5.6% and 8.6%, respectively [4] - Financial and Valuation Advisory segment revenues increased by 15.1% year over year, driven by a rise in the number of fee events, with Managing Directors up by 7.7% [5] Full-Year Update - For fiscal 2025, total revenues increased by 24.8% year over year to $2.4 billion, while total operating expenses rose by 21.7% to $1.9 billion [6] - Adjusted EPS for the full year rose by 40.1% year over year to $6.29 [6] Financial Position - As of March 31, 2025, HLI had cash and cash equivalents of $971 million, up from $721.2 million at the end of fiscal 2024 [7] - Total assets increased to $3.8 billion from $3.2 billion at the end of fiscal 2024 [7] - Total equity rose to $2.2 billion from $1.8 billion at the end of fiscal 2024 [7] Dividend Update - HLI announced a 5% increase in its cash dividend to 60 cents per share, payable on June 15, 2025, to shareholders of record as of June 2 [9]

Company Overview - As of March 31, 2025, the company had a team of 1,893 financial professionals across 35 offices globally, serving over 2,000 clients annually[19]. - The company employs a total of 2,702 people as of March 31, 2025, reflecting a slight increase from 2,601 in 2024[38]. - Approximately 1,100 present and former employee shareholders collectively own about 24% of the company's equity, promoting a culture of broad employee ownership[35]. Business Segments - The Corporate Finance segment had 240 Managing Directors focusing on mid-cap transactions, which are considered an attractive and underserved market segment[20]. - The M&A business is recognized as one of the most prolific sell-side advisors, consistently selling more companies valued under $1 billion than any competitor[23]. - The Financial Restructuring group, with 57 Managing Directors, is one of the largest in the investment banking industry, focusing on complex restructuring and liability management transactions globally[28]. - The Financial and Valuation Advisory group, consisting of 42 Managing Directors, is known for its expertise in valuation and financial opinions, serving a wide range of clients[33]. Market Presence and Competition - The company has established a significant presence in major industry segments, including technology, healthcare, and financial services, and continues to expand its capabilities through internal promotions and acquisitions[21]. - The company competes with various investment banking firms, including bulge-bracket firms and boutique firms, based on industry knowledge and client relationships[39]. Regulatory Compliance - Regulatory compliance is a significant aspect of the company's operations, with oversight from the SEC and FINRA, ensuring adherence to financial regulations[41]. - The company is subject to various compliance regulations, including the U.S. Foreign Corrupt Practices Act and the UK Bribery Act, to mitigate reputational risks[57]. International Operations and Currency Risk - The company operates through various subsidiaries across Europe, Asia Pacific, the Middle East, and South America, providing regulated and unregulated financial advisory services[46][51][52][56]. - The company maintains cash and cash equivalents primarily in U.S. Dollars, Pound Sterling, Euros, and Yen, facing foreign currency risk due to potential currency movements[206][208]. - For the years ended March 31, 2025, 2024, and 2023, the net impact of foreign currency fluctuations on other comprehensive income was $3.3 million, $(3.8) million, and $(19.5) million, respectively[209]. - As of March 31, 2025, the company had foreign currency forward contracts with an aggregate notional value of $75.0 million and SEK 79.0 million, reflecting a gain in other operating expenses[211]. - The company has been impacted by changes in exchange rates, with potential future impacts increasing as international expansion continues[212]. - The company’s European operations are supported by HLE GmbH, established to mitigate Brexit impacts, and is approved by the German regulatory authority[48][49]. Financial Management - The company regularly reviews accounts receivable and maintains an allowance for credit losses to cover potential losses[207]. - As of March 31, 2025, the HL Voting Trust controls approximately 74.9% of the total voting power of the company, classifying it as a "controlled company" under NYSE rules[60][61].

Group 1 - The article expresses a beneficial long position in the shares of ITJTQ, indicating a positive outlook on the company's stock performance [1] - The author emphasizes the importance of conducting due diligence and research prior to any investment, highlighting the risks associated with short-term trading and options trading [2] - It is noted that past performance is not indicative of future results, and no specific investment recommendations are provided [3]

Revenue Growth - Fiscal Year 2025 revenues reached a record $2.39 billion, up 25% from $1.91 billion in Fiscal Year 2024[2] - Fourth Quarter Fiscal 2025 revenues were $666 million, an increase of 28% compared to $520 million in the same quarter of Fiscal Year 2024[2] - Corporate Finance segment revenues increased by 38% year-over-year for Fiscal Year 2025, totaling $1.53 billion[8] - Fourth Quarter Corporate Finance revenues were $413 million, a 43.7% increase from $288 million in the same quarter of Fiscal Year 2024[21] - Financial Restructuring revenues increased to $165 million for Q4 2025, up from $155 million in Q4 2024, driven by a higher number of closed transactions[23] - Financial and Valuation Advisory revenues rose to $89 million in Q4 2025, compared to $77 million in Q4 2024, attributed to improvements in M&A markets[25] - Revenues for the quarter ended March 31, 2025, were $666.4 million, a 28% increase from $520.5 million in the same quarter of 2024[37] - The company reported an increase in revenues for the year ended March 31, 2025, reaching $2,389,416 thousand, a 25% increase from $1,914,404 thousand in the previous year[38] Earnings Performance - Fiscal Year 2025 diluted EPS was $5.82, compared to $4.11 for Fiscal Year 2024, representing a 41.5% increase[3] - Adjusted Fiscal Year 2025 diluted EPS was $6.29, up from $4.49 in Fiscal Year 2024, marking a 40.1% increase[3] - Net income for the year ended March 31, 2025, was $399.7 million, compared to $280.3 million for the year ended March 31, 2024, representing a 43% increase[37] - Adjusted operating income for the three months ended March 31, 2025, was $171,307 thousand, up 43% from $119,416 thousand in the prior year[38] - Net income (adjusted) for the three months ended March 31, 2025, was $136,307 thousand, a 55% increase compared to $87,763 thousand in the same period of 2024[38] - Diluted EPS attributable to Houlihan Lokey, Inc. (adjusted) for the three months ended March 31, 2025, was $1.96, up 54% from $1.27 in the same period of 2024[38] Expenses and Compensation - Employee compensation and benefits expenses for Fiscal Year 2025 were $1.52 billion, up from $1.21 billion in Fiscal Year 2024, resulting in a GAAP compensation ratio of 63.8%[15] - Adjusted non-compensation expenses for Fiscal Year 2025 were $329 million, compared to $314 million in Fiscal Year 2024, reflecting an increase in operating expenses[16] - Employee compensation and benefits expenses (adjusted) for the three months ended March 31, 2025, were $409,850 thousand, an increase of 28% from $320,077 thousand in the same period of 2024[38] - Non-compensation expenses (adjusted) for the three months ended March 31, 2025, were $85,265 thousand, a slight increase from $80,963 thousand in the same period of 2024[38] Tax and Dividends - The provision for income taxes for Fiscal Year 2025 was $132 million, with an effective tax rate of 24.8%, down from 28.2% in Fiscal Year 2024[17] - The provision for income taxes (adjusted) for the three months ended March 31, 2025, was $44,199 thousand, compared to $37,438 thousand in the same period of 2024[38] - The company announced a 5% increase in the quarterly dividend to $0.60 per share[1] - The company declared a quarterly cash dividend of $0.60 per share, payable on June 15, 2025[27] Transaction Activity - The number of closed transactions in Corporate Finance increased to 147 in Q4 2025, up from 121 in Q4 2024, reflecting a strong market environment[22] - The number of managing directors in Financial Restructuring increased to 57 in 2025 from 54 in 2024, indicating growth in leadership capacity[24] - The average transaction fee on closed transactions in Financial Restructuring increased, although this does not indicate a consistent trend[23] Future Outlook - The company plans to host a conference call on May 7, 2025, to discuss its full year and fourth quarter fiscal 2025 results[28]