Financial Data and Key Metrics Changes - The company maintained a gross profit margin and net profit margin of 5% [2][5][6] - Material expenses remained stable, indicating effective cost management [3] Business Line Data and Key Metrics Changes - The company expanded its product portfolio to include exclusive online items, enhancing its market presence [3][7] - The average transaction value (ATV) showed positive trends, contributing to net profit after tax [4][8] Market Data and Key Metrics Changes - The company is focusing on expanding its offline store presence while maintaining profitability [2][5] - Online sales channels are being stimulated through exclusive products and live streaming initiatives [4][5][8] Company Strategy and Development Direction - The company is pursuing a strategy that integrates online and offline platforms, enhancing customer engagement through live streaming and exclusive online offerings [5][8] - There is a focus on leveraging brand equity and expanding into new market segments, particularly targeting Generation X, Y, and Z [6][7] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining margins despite competitive pressures, emphasizing a strong brand image and product differentiation [5][6] - The long-term outlook includes a commitment to online growth and adapting to changing consumer behaviors across various platforms [8] Other Important Information - The company is actively utilizing social media platforms like TikTok to drive brand awareness and sales [8] Q&A Session Summary Question: What is the company's strategy for online and offline integration? - The company is focusing on seamless integration between online and offline channels, utilizing live streaming and exclusive products to enhance customer experience [5][8] Question: How does the company plan to maintain its profit margins? - Management indicated that maintaining gross and net margins is a priority, supported by effective cost management and a strong brand image [2][5][6]

Financial Data and Key Metrics Changes - The company maintained a gross profit margin and net profit margin of approximately 5% of sales [1][2][5] - Operating expenses remained stable, allowing for a consistent net margin [5][6] Business Line Data and Key Metrics Changes - The company expanded its product portfolio to include exclusive online items, enhancing its average transaction value (ATV) [4][8] - The segmentation strategy focused on value for money, targeting different generational categories (Gen X, Y, Z) [3][5] Market Data and Key Metrics Changes - The online channel showed significant growth, with exclusive products driving traffic and sales [4][7] - The company is leveraging brand equity through its online platforms, particularly macshop.com [6][7] Company Strategy and Development Direction - The company is focusing on a seamless integration between offline and online sales channels, utilizing live streaming and social media platforms like TikTok for marketing [5][8] - Long-term plans include expanding the number of stores and enhancing the brand's presence in both online and offline markets [2][8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in maintaining margins despite competitive pressures, emphasizing the importance of brand image and product quality [5][6] - The outlook remains positive with a focus on category expansion and leveraging online sales channels [7][8] Other Important Information - The company is actively engaging in category expansion, particularly targeting younger demographics through exclusive online offerings [3][7] - The integration of online and offline strategies is seen as a key driver for future growth [5][8] Q&A Session Summary Question: What is the company's strategy for online sales growth? - The company plans to enhance its online presence through exclusive products and improved customer engagement strategies [4][7] Question: How does the company maintain its profit margins? - Management highlighted stable operating expenses and a focus on brand equity as crucial factors in maintaining profit margins [5][6] Question: What are the future plans for store expansion? - The company aims to increase the number of superstores and enhance its offline presence while integrating online strategies [2][8]

Financial Performance & Position - MC Group's cash and short-term investments stand at THB 1,984 million[25], with a zero-debt position[35], indicating financial resilience - Online sales experienced a significant year-over-year growth of +69%[28], shifting the online sales contribution to 17% of total sales[28] - The company maintains a high gross margin while controlling expenses, with gross profit increasing by +2.0%[30] and SG&A to sales decreasing to 42.4%[30] - Net profit margin increased to 18.0%[33], with EBIT increasing by +3.5%[33] - Inventory levels are controlled lower than FY2024[35] Business Strategy & Operations - The company is transitioning from a denim-focused brand to a lifestyle brand, with denim products accounting for 33%[12] and non-denim products for 67%[12] of the product portfolio - MC Group has a fully integrated supply chain[14], allowing for business flexibility and high margin maintenance[17] - The company aims to expand brick-and-mortar stores in potential locations while investing wisely in e-commerce[54] - CRM is identified as a profit center, with a focus on enhancing the royalty program and increasing customer engagement[77] Product Portfolio - The product portfolio mix shows Denim at 42% in FY23, 34% in FY24 and 33% in FY25[49], Non-Denim at 45% in FY23, 49% in FY24 and 47% in FY25[49], and Accessories at 13% in FY23, 17% in FY24 and 20% in FY25[49]

Core Viewpoint - Moelis (MC) is seen as an attractive investment opportunity due to a significant improvement in its earnings outlook, with analysts raising their earnings estimates, which may lead to continued stock momentum [1][2]. Earnings Estimate Revisions - The upward trend in earnings estimate revisions indicates growing analyst optimism regarding Moelis's earnings prospects, which is expected to positively impact its stock price [2]. - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), has shown that stocks with a Zacks Rank 1 have generated an average annual return of +25% since 2008, highlighting the potential for Moelis [3]. Current Quarter and Year Estimates - For the current quarter, Moelis is expected to earn $0.52 per share, reflecting a year-over-year increase of +136.4%. The Zacks Consensus Estimate has risen by 7.29% over the last 30 days due to positive revisions [6]. - For the full year, the expected earnings per share is $2.45, representing a year-over-year change of +34.6%. The consensus estimate has increased by 5.26% over the past month, with no negative revisions [7][8]. Zacks Rank and Investment Potential - Moelis has achieved a Zacks Rank 1 (Strong Buy) due to favorable estimate revisions, which suggests strong potential for stock performance [9]. - The stock has gained 5.2% over the past four weeks, indicating investor confidence in its earnings growth prospects, making it a candidate for portfolio consideration [10].

Core Viewpoint - Moelis (MC) presents a strong investment opportunity due to its improving earnings outlook and analysts' increasing earnings estimates [1][2]. Earnings Estimates - Analysts are optimistic about Moelis's earnings prospects, leading to higher estimates that are expected to positively impact the stock price [2]. - The current-quarter earnings estimate is $0.39 per share, reflecting a +77.3% change from the previous year [6]. - Over the last 30 days, the Zacks Consensus Estimate for Moelis has increased by 11.59%, with two estimates moving higher and two going lower [6]. - For the full year, the earnings estimate is $2.07 per share, representing a +13.7% change from the year-ago figure [7]. - The consensus estimate for the current year has increased by 12.08%, with three estimates moving higher compared to one negative revision [8]. Zacks Rank - Moelis currently holds a Zacks Rank 2 (Buy), indicating promising estimate revisions that could lead to significant outperformance [9]. - Stocks with Zacks Rank 1 (Strong Buy) and 2 (Buy) have historically outperformed the S&P 500 [9]. Stock Performance - Moelis's stock has risen by 14.4% over the past four weeks due to strong estimate revisions, suggesting potential for further upside [10].

Core Insights - Moelis & Company (MC) shares increased by 2.8% in after-hours trading following the release of its second-quarter 2025 results, which exceeded expectations with adjusted earnings of 53 cents per share compared to the Zacks Consensus Estimate of 32 cents, and a significant improvement from 18 cents per share in the prior-year quarter [1][8] Financial Performance - The company's net income on a GAAP basis was $46.8 million, a substantial increase from $14.9 million in the prior-year quarter [2] - Total revenues on a GAAP basis grew by 38.1% year over year to $364.4 million, surpassing the Zacks Consensus Estimate of $281.8 million [3][8] - Total operating expenses on a GAAP basis rose by 24.6% to $304.7 million, driven by increases in both compensation and benefits costs as well as non-compensation expenses [3][8] - Other income on a GAAP basis was reported at $3.5 million, up from $1.7 million in the prior year, exceeding projections of $3 million [4] Liquidity and Capital Position - As of June 30, 2025, the company held cash and liquid investments totaling $474.9 million, with no debt or goodwill [4] Strategic Outlook - The company's global expansion initiatives, higher average fees, solid capital markets, and diverse operations across sectors are expected to positively influence future performance [5] - However, a hiring spree and rising revenue-related compensation may negatively impact bottom-line growth [5] Peer Performance - Morgan Stanley reported second-quarter 2025 earnings of $2.13 per share, exceeding estimates and showing a 17% increase from the prior year, supported by strong investment banking and wealth management performance [6] - Goldman Sachs achieved adjusted earnings per share of $10.91, surpassing estimates and reflecting growth in its Global Banking & Markets division, despite concerns over increased expenses [7]

Group 1 - Moelis reported quarterly earnings of $0.53 per share, exceeding the Zacks Consensus Estimate of $0.32 per share, and showing a significant increase from $0.18 per share a year ago, representing an earnings surprise of +65.62% [1] - The company achieved revenues of $365.38 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 29.67%, compared to $264.59 million in the same quarter last year [2] - Moelis has consistently surpassed consensus EPS estimates over the last four quarters, indicating strong performance [2] Group 2 - The stock has underperformed the market, losing about 3.9% since the beginning of the year, while the S&P 500 has gained 8.1% [3] - The company's earnings outlook is crucial for investors, as it includes current consensus earnings expectations for upcoming quarters [4] - The current consensus EPS estimate for the next quarter is $0.36 on revenues of $296.09 million, and for the current fiscal year, it is $1.97 on revenues of $1.29 billion [7] Group 3 - The Financial - Investment Bank industry, to which Moelis belongs, is currently ranked in the top 5% of over 250 Zacks industries, suggesting a favorable outlook for the sector [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Moelis's stock performance [5][6]

Financial Data and Key Metrics Changes - The company reported revenues of $365 million in Q2 2025, a 38% increase compared to the prior year period, marking the highest second quarter revenues on record [5] - First half revenues reached $672 million, up 39% from the prior year period [5] - The compensation expense ratio for Q2 was 69%, consistent with the previous quarter, while non-compensation expense ratio was 14.4% [6][7] - The corporate tax rate was accrued at 29.5%, consistent with Q1 [7] - The company maintained a strong balance sheet with cash and liquid investments of $475 million and no debt [7] Business Line Data and Key Metrics Changes - The year-over-year revenue increase was primarily driven by growth in M&A and capital markets [6] - The company achieved record revenues in the first half of the year, reflecting successful investments in capital markets [9] Market Data and Key Metrics Changes - The company noted a significantly improved transaction environment entering the second half of the year, recovering from the disruptions caused by the "Liberation Day" market chaos [8] - The pipeline for new business origination is near record levels, indicating strong market activity [8] Company Strategy and Development Direction - The company aims to build a premier platform in secondary and primary capital solutions for sponsors, with plans to aggressively scale this franchise [9] - The focus remains on investing in high total addressable markets (TAMs) and attracting elite talent to drive revenue growth [31][32] - The company is committed to maintaining a strong culture and internal talent development, with 40% of MDs being internally promoted [32] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the improving market conditions and the company's ability to execute for clients [9] - The company anticipates continued growth in the private capital advisory business, viewing it as a significant revenue opportunity [26][28] - Management acknowledged the potential for returning excess capital to shareholders, including stock repurchases [77][78] Other Important Information - A CEO transition is underway, with Navid Mahmoodzadegan stepping into the role, while Kenneth Moelis will serve as Executive Chairman [11][13] - The company is actively hiring in various sectors, focusing on building pipelines and covering more areas [65] Q&A Session Summary Question: Progression of sponsor reengagement across sectors - Management noted a broad recovery across sectors, with some areas still affected by trade uncertainty [20][22] Question: Addressable market for private capital advisory - Management sees the addressable market for private capital advisory as potentially exceeding a couple of hundred million dollars, with aggressive hiring planned [25][26] Question: Focus areas for the next phase of growth - The strategy will continue to focus on high TAMs, attracting elite talent, and maintaining a strong culture [31][32] Question: Outlook for M&A and IPO activity post Labor Day - Management indicated a steady improvement in market activity, with increasing enthusiasm for transactions [40][41] Question: Trends in restructuring activity - Restructuring activity has trended slightly down, as companies prefer financing options in a strong market [52] Question: Flexibility of compensation ratio - Management stated that the compensation ratio is top-line driven and will be evaluated based on revenue growth [56][60] Question: Hiring focus outside of PCA - Management is in active discussions for talent across various sectors, aiming to build franchises in untapped areas [65][66] Question: Cash and liquid investments return to shareholders - Management acknowledged excess capital and is considering various ways to return it to shareholders, including stock repurchases [77][78]

Financial Data and Key Metrics Changes - The company reported revenues of $365 million in Q2 2025, a 38% increase compared to the prior year period, marking the highest second quarter revenues on record [4] - First half revenues reached $672 million, up 39% from the prior year period [4] - The compensation expense ratio for Q2 was 69%, consistent with the previous quarter, while the non-compensation expense ratio was 14.4% [5][6] - The corporate tax rate was accrued at 29.5%, consistent with Q1 [6] - The company maintained a strong balance sheet with cash and liquid investments of $475 million and no debt [6] Business Line Data and Key Metrics Changes - The year-over-year revenue increase was primarily driven by growth in M&A and capital markets [5] - The company achieved record revenues in the first half of the year, reflecting successful investments made over the past few years [7] Market Data and Key Metrics Changes - The company noted a significantly improved transaction environment entering the second half of the year, recovering from the disruptions caused by Liberation Day [7] - The pipeline for new business origination is near record levels, indicating strong market activity [7] Company Strategy and Development Direction - The company aims to aggressively scale its private capital advisory business, viewing it as a significant growth opportunity [9][25] - The capital structure advisory team is engaged in a steady amount of liability management across various industries [10] - The company plans to continue investing in high total addressable markets (TAMs) and attracting elite talent to drive growth [31] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the improving market conditions and the growing investor risk appetite [8] - The company anticipates a steady improvement in market activity, with a focus on maintaining flexibility in hiring and investment strategies [36][60] Other Important Information - The company declared a regular quarterly dividend of $0.65 per share, consistent with the prior period [6] - A CEO transition is underway, with Naved Mabuzadigan stepping into the role, emphasizing a focus on client relationships and talent development [11][13] Q&A Session Summary Question: Progression of sponsor reengagement across sectors - Management noted a broad recovery across sectors, with some areas still affected by trade uncertainties, but overall enthusiasm is returning [21][22] Question: Addressable market for private capital advisory - Management believes the addressable market for private capital advisory could be several hundred million dollars, with plans for aggressive hiring to support growth [25][27] Question: Next phase of growth focus - The focus will remain on high TAMs, attracting elite talent, and maintaining a strong internal culture [31][32] Question: Outlook for restructuring activity - Restructuring activity has trended slightly down, as companies prefer financing options in a strong market [52] Question: Compensation ratio flexibility - Management indicated that the compensation ratio is top-line driven and will be evaluated based on revenue growth [56][60] Question: Cash and liquid investments return to shareholders - The company is considering various ways to return excess capital to shareholders, including stock repurchases [76]

PART I. FINANCIAL INFORMATION [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) The company presents its unaudited condensed consolidated financial statements and accompanying notes for the period [Condensed Consolidated Statements of Financial Condition](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Financial%20Condition) Condensed Consolidated Statements of Financial Condition (June 30, 2025 vs. December 31, 2024) | Metric | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | Change (vs. Dec 31, 2024) | | :--------------------------------- | :----------------------------- | :------------------------------- | :------------------------ | | Total Assets | $1,342,535 | $1,378,936 | -$36,401 | | Cash and cash equivalents | $221,718 | $412,467 | -$190,749 | | Total Receivables | $102,759 | $73,709 | +$29,050 | | Investments | $290,175 | $184,601 | +$105,574 | | Total Liabilities | $746,525 | $899,553 | -$153,028 | | Compensation payable | $189,249 | $346,323 | -$157,074 | | Total Equity | $596,010 | $479,383 | +$116,627 | [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Condensed Consolidated Statements of Operations (Three Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | Change (YoY) | | :------------------------------------ | :------------------ | :------------------ | :----------- | | Revenues | $365,376 | $264,586 | +38% | | Total expenses | $304,747 | $244,518 | +25% | | Operating income (loss) | $60,629 | $20,068 | +202% | | Net income (loss) | $46,755 | $14,921 | +213% | | Net income (loss) attributable to Moelis & Company | $41,538 | $13,161 | +216% | | Diluted EPS | $0.53 | $0.17 | +212% | Condensed Consolidated Statements of Operations (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | Change (YoY) | | :------------------------------------ | :------------------ | :------------------ | :----------- | | Revenues | $671,969 | $482,071 | +39% | | Total expenses | $574,428 | $456,201 | +26% | | Operating income (loss) | $97,541 | $25,870 | +277% | | Net income (loss) | $100,530 | $32,406 | +210% | | Net income (loss) attributable to Moelis & Company | $91,806 | $29,727 | +209% | | Diluted EPS | $1.17 | $0.39 | +200% | [Condensed Consolidated Statements of Comprehensive Income](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income) Condensed Consolidated Statements of Comprehensive Income (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | Change (YoY) | | :------------------------------------------------ | :------------------ | :------------------ | :----------- | | Net income (loss) | $100,530 | $32,406 | +210% | | Foreign currency translation adjustment and other, net of tax | $2,602 | -$275 | N/A | | Comprehensive income (loss) attributable to Moelis & Company | $94,186 | $29,484 | +219% | [Condensed Consolidated Statements of Cash Flows](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Condensed Consolidated Statements of Cash Flows (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | Change (YoY) | | :------------------------------------ | :------------------ | :------------------ | :----------- | | Net cash provided by (used in) operating activities | $38,687 | -$25,036 | N/A | | Net cash provided by (used in) investing activities | -$113,057 | $108,760 | N/A | | Net cash provided by (used in) financing activities | -$117,796 | -$119,555 | -1.5% | | Net increase (decrease) in cash, cash equivalents, and restricted cash | -$190,663 | -$35,972 | N/A | | Cash, cash equivalents, and restricted cash, end of period | $222,516 | $151,243 | +47.1% | [Condensed Consolidated Statements of Changes in Equity](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Changes%20in%20Equity) Condensed Consolidated Statements of Changes in Equity (June 30, 2025 vs. January 1, 2025) | Metric | Balance as of Jan 1, 2025 (in thousands) | Balance as of June 30, 2025 (in thousands) | Change | | :------------------------------------ | :--------------------------------------- | :--------------------------------------- | :----- | | Total Moelis & Company equity | $441,606 | $515,982 | +$74,376 | | Noncontrolling interests | $37,777 | $80,028 | +$42,251 | | Total Equity | $479,383 | $596,010 | +$116,627 | - The increase in total equity is primarily driven by **net income and equity-based compensation**, partially offset by dividends declared and treasury stock purchases[21](index=21&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) [1. Organization and Basis of Presentation](index=10&type=section&id=1.%20ORGANIZATION%20AND%20BASIS%20OF%20PRESENTATION) - Moelis & Company is a global investment bank providing advisory services in M&A, recapitalizations, restructurings, and other corporate finance matters, operating as a **single business segment**[24](index=24&type=chunk)[25](index=25&type=chunk) - The company's structure involves Moelis & Company controlling Group LP and its operating subsidiaries, with **noncontrolling interests** held by Group LP partnership unit owners[24](index=24&type=chunk)[26](index=26&type=chunk) - Key subsidiaries include U.S. Broker Dealer, Moelis International, and an equity method investment in **MA Financial Group Limited**[27](index=27&type=chunk)[32](index=32&type=chunk) [2. Summary of Significant Accounting Policies](index=11&type=section&id=2.%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) - Financial statements are prepared in conformity with **U.S. GAAP**, with estimates and assumptions affecting reported amounts[28](index=28&type=chunk)[30](index=30&type=chunk) - The company consolidates entities where it has a controlling financial interest or is the primary beneficiary of variable interest entities[29](index=29&type=chunk) - Revenue from advisory services is mostly **recognized over time**, with transaction fees constrained until substantially all services are provided and conditions met[59](index=59&type=chunk)[60](index=60&type=chunk)[61](index=61&type=chunk)[62](index=62&type=chunk) - Equity-based compensation is recognized over the service period based on **grant-date fair value**, adjusted for retirement eligibility[69](index=69&type=chunk)[70](index=70&type=chunk) - Income taxes are accounted for under **ASC 740**, recognizing deferred tax assets/liabilities on temporary differences[71](index=71&type=chunk) [3. Recent Accounting Pronouncements](index=17&type=section&id=3.%20RECENT%20ACCOUNTING%20PRONOUNCEMENTS) - ASU No. 2023-09 (Income Taxes) requires more detailed disclosures for tax rate reconciliation and income taxes paid, effective for fiscal years beginning after December 15, 2024[76](index=76&type=chunk) - ASU No. 2024-03 (Disaggregation of Income Statement Expenses) requires disaggregation of certain expense categories, effective for fiscal years beginning after December 15, 2026[77](index=77&type=chunk) [4. Fixed and Intangible Assets](index=17&type=section&id=4.%20FIXED%20AND%20INTANGIBLE%20ASSETS) Equipment and Leasehold Improvements, Net (June 30, 2025 vs. December 31, 2024) | Asset Category | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :--------------------------- | :----------------------------- | :------------------------------- | | Office equipment | $23,760 | $22,154 | | Furniture and fixtures | $17,126 | $16,842 | | Leasehold improvements | $77,043 | $75,295 | | Construction in progress | $6,403 | $2,556 | | Total | $124,332 | $116,847 | | Less: Accumulated depreciation and amortization | ($56,564) | ($51,396) | | **Equipment and leasehold improvements, net** | **$67,768** | **$65,451** | - Depreciation and amortization expenses for fixed assets increased to **$5,539 thousand** for the six months ended June 30, 2025, from $4,809 thousand in the prior year[78](index=78&type=chunk) - Capitalized costs for cloud computing arrangements, net of amortization, were **$861 thousand** as of June 30, 2025[79](index=79&type=chunk) [5. Investments](index=17&type=section&id=5.%20INVESTMENTS) Fair Value of Financial Assets (June 30, 2025) | Asset Category | Total (in thousands) | Level 1 (in thousands) | Level 2 (in thousands) | Level 3 (in thousands) | | :------------------------------------ | :------------------- | :--------------------- | :--------------------- | :--------------------- | | Money market funds | $115,642 | — | $115,642 | — | | Certificates of Deposit (Cash & CE) | $4,000 | — | $4,000 | — | | Sovereign debt securities (Investments) | $235,210 | — | $235,210 | — | | Certificates of Deposit (Investments) | $18,000 | — | $18,000 | — | | **Total fair value assets** | **$372,852** | **—** | **$372,852** | **—** | - The company recognized unrealized gains of **$192 thousand** for Q2 2025 and unrealized losses of **$527 thousand** for H1 2025 on sovereign debt securities[83](index=83&type=chunk) - The carrying value of the equity method investment in MA Financial was **$36,965 thousand** as of June 30, 2025[85](index=85&type=chunk)[86](index=86&type=chunk) [6. Net Income (Loss) Per Share Attributable to Class A Common Shareholders](index=19&type=section&id=6.%20NET%20INCOME%20(LOSS)%20PER%20SHARE%20ATTRIBUTABLE%20TO%20CLASS%20A%20COMMON%20SHAREHOLDERS) Net Income (Loss) Per Share (Three Months Ended June 30) | Metric | 2025 | 2024 | | :------------------------------------------------ | :--- | :--- | | Net income (loss) attributable to Class A common stock—basic | $41,538 | $13,161 | | Basic EPS | $0.55 | $0.18 | | Diluted EPS | $0.53 | $0.17 | Net Income (Loss) Per Share (Six Months Ended June 30) | Metric | 2025 | 2024 | | :------------------------------------------------ | :--- | :--- | | Net income (loss) attributable to Class A common stock—basic | $91,806 | $29,727 | | Basic EPS | $1.23 | $0.42 | | Diluted EPS | $1.17 | $0.39 | - The assumed exchange of Class A partnership units for Class A common stock was **not dilutive** for the periods presented[90](index=90&type=chunk) [7. Equity-Based Compensation](index=19&type=section&id=7.%20EQUITY%E2%80%91BASED%20COMPENSATION) - The **2024 Omnibus Incentive Plan** replaced the 2014 Plan, authorizing the issuance of up to 15,000,000 shares plus forfeited shares from the prior plan[92](index=92&type=chunk)[93](index=93&type=chunk) - For H1 2025, the company recognized **$127,843 thousand** in expenses related to RSUs and other stock-based awards, an increase from $85,935 thousand in 2024[94](index=94&type=chunk) - The company granted **822,931 Partnership Units** and **450,000 Performance Units** during H1 2025[96](index=96&type=chunk)[97](index=97&type=chunk) - Total unrecognized compensation expense for unvested awards was **$304,163 thousand** as of June 30, 2025, to be recognized over a weighted-average period of 2.2 years[98](index=98&type=chunk) [8. Stockholders Equity](index=20&type=section&id=8.%20STOCKHOLDERS%20EQUITY) Class A Common Stock (Shares Issued and Outstanding) | Date | Shares Issued | Shares Outstanding | | :---------------- | :------------ | :----------------- | | June 30, 2025 | 84,745,796 | 74,178,031 | | December 31, 2024 | 80,970,827 | 70,589,951 | - Changes in Class A common stock are primarily due to follow-on offerings, exchanges of partnership units, and RSU vesting[102](index=102&type=chunk) - The company repurchased **186,889 shares for $13,270 thousand** during H1 2025[105](index=105&type=chunk) - As of June 30, 2025, **$61,115 thousand remained available** under the $100 million share repurchase program[106](index=106&type=chunk) - Noncontrolling interests accounted for **8% of Moelis & Company** as of June 30, 2025[107](index=107&type=chunk) [9. Related-Party Transactions](index=22&type=section&id=9.%20RELATED%E2%80%91PARTY%20TRANSACTIONS) - The company entered into a new aircraft dry lease with a related party, incurring lease costs of **$628 thousand** for H1 2025[110](index=110&type=chunk)[111](index=111&type=chunk) - Unsecured promissory notes from employees totaled **$9,441 thousand** as of June 30, 2025[112](index=112&type=chunk) - Revenues from advisory transactions with affiliated entities decreased significantly to **$131 thousand** for H1 2025 from $9,663 thousand in the prior year[114](index=114&type=chunk) [10. Regulatory Requirements](index=22&type=section&id=10.%20REGULATORY%20REQUIREMENTS) - U.S. Broker Dealer had net capital of **$230,593 thousand** as of June 30, 2025, exceeding its minimum requirement by $230,343 thousand[115](index=115&type=chunk) - Non-U.S. subsidiaries consistently **exceeded their local capital adequacy requirements**[116](index=116&type=chunk) [11. Commitments and Contingencies](index=22&type=section&id=11.%20COMMITMENTS%20AND%20CONTINGENCIES) - The company renewed its revolving credit facilities, maintaining aggregate base credit commitments of **$50,000 thousand**, with no borrowings as of June 30, 2025[117](index=117&type=chunk)[119](index=119&type=chunk)[120](index=120&type=chunk) - Operating lease liabilities totaled **$218,825 thousand** as of June 30, 2025, with a weighted-average remaining lease term of 10.37 years[121](index=121&type=chunk)[122](index=122&type=chunk)[124](index=124&type=chunk) - A new office lease in London will add approximately **$50,000 thousand** in ROU assets and lease liabilities[124](index=124&type=chunk) - The company is involved in legal proceedings, including an appeal of a Delaware Court order and a dismissed class action lawsuit related to the Archer Aviation merger[126](index=126&type=chunk)[127](index=127&type=chunk)[222](index=222&type=chunk) [12. Employee Benefit Plans](index=24&type=section&id=12.%20EMPLOYEE%20BENEFIT%20PLANS) - The company accrued **$2,038 thousand** in employer matching contributions to its 401(k) plan for H1 2025[129](index=129&type=chunk) [13. Income Taxes](index=25&type=section&id=13.%20INCOME%20TAXES) Provision for Income Taxes (Six Months Ended June 30) | Metric | 2025 (in thousands) | 2024 (in thousands) | | :-------------------------- | :------------------ | :------------------ | | Provision (benefit) for income taxes | $6,662 | -$599 | - The income tax provision for H1 2025 reflects the company's share of operating results from Group LP, offset by **$22,452 thousand** in excess tax benefits from equity-based compensation[131](index=131&type=chunk) - Group LP is currently under **IRS examination** for the 2020 tax year[132](index=132&type=chunk)[133](index=133&type=chunk) [14. Segment Information](index=25&type=section&id=14.%20SEGMENT%20INFORMATION) - The company operates as a **single segment advisory business** globally[134](index=134&type=chunk)[135](index=135&type=chunk) Revenues by Geographic Location (Six Months Ended June 30) | Region | 2025 (in thousands) | 2024 (in thousands) | Change (YoY) | | :------------ | :------------------ | :------------------ | :----------- | | United States | $520,215 | $355,310 | +46.4% | | Europe | $90,791 | $70,233 | +29.3% | | Rest of World | $60,963 | $56,528 | +7.9% | | **Total** | **$671,969** | **$482,071** | **+39.4%** | Assets by Geographic Location (June 30, 2025 vs. December 31, 2024) | Region | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | Change | | :------------ | :----------------------------- | :------------------------------- | :----- | | United States | $1,084,456 | $1,169,236 | -$84,780 | | Europe | $96,520 | $65,380 | +$31,140 | | Rest of World | $161,559 | $144,320 | +$17,239 | | **Total** | **$1,342,535** | **$1,378,936** | **-$36,401** | [15. Subsequent Events](index=26&type=section&id=15.%20SUBSEQUENT%20EVENTS) - The Board of Directors declared a dividend of **$0.65 per share**, payable on September 18, 2025[140](index=140&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=27&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, business outlook, liquidity, and critical accounting policies for the period [Executive Overview](index=27&type=section&id=Executive%20Overview) - Moelis & Company is a leading global independent investment bank offering strategic advice and solutions across M&A, recapitalizations, and restructurings[144](index=144&type=chunk) - As of June 30, 2025, the company served clients with **940 advisory bankers**, generating revenues primarily from advisory services on transactions[145](index=145&type=chunk) [Business Environment and Outlook](index=27&type=section&id=Business%20Environment%20and%20Outlook) - For H1 2025, GAAP revenues **increased by 39% to $672.0 million**, significantly outpacing the 2% increase in global completed M&A transactions[147](index=147&type=chunk) - The company is encouraged by **new business origination and deal pipeline strength**, with M&A market improvement driven by strategic priorities[148](index=148&type=chunk) - Optimism for growth in the private capital advisory business is high due to **near-record levels of capital** accumulated by financial sponsors[148](index=148&type=chunk)[149](index=149&type=chunk) - The company maintains a strong balance sheet with **substantial liquidity and zero debt**[149](index=149&type=chunk) [Results of Operations](index=28&type=section&id=Results%20of%20Operations) Key Financial Results (Three and Six Months Ended June 30) | Metric | 3 Months 2025 (in thousands) | 3 Months 2024 (in thousands) | 3 Months Variance | 6 Months 2025 (in thousands) | 6 Months 2024 (in thousands) | 6 Months Variance | | :-------------------------- | :--------------------------- | :--------------------------- | :---------------- | :--------------------------- | :--------------------------- | :---------------- | | Revenues | $365,376 | $264,586 | 38% | $671,969 | $482,071 | 39% | | Total operating expenses | $304,747 | $244,518 | 25% | $574,428 | $456,201 | 26% | | Operating income (loss) | $60,629 | $20,068 | 202% | $97,541 | $25,870 | 277% | | Net income (loss) | $46,755 | $14,921 | 213% | $100,530 | $32,406 | 210% | [Revenues](index=28&type=section&id=Revenues_MD&A) - Revenues increased by **38% in Q2 2025** and **39% in H1 2025**, primarily due to an increase in average fees earned per completed transaction[156](index=156&type=chunk)[158](index=158&type=chunk) - The number of clients paying fees of **$1 million or more** was 117 for H1 2025, consistent with the prior year[157](index=157&type=chunk)[159](index=159&type=chunk) - Revenue recognition is largely over time, but transaction fees are constrained, making revenue unpredictable due to transaction complexities[153](index=153&type=chunk)[154](index=154&type=chunk) [Operating Expenses](index=29&type=section&id=Operating%20Expenses_MD&A) Operating Expenses (Three and Six Months Ended June 30) | Expense Category | 3 Months 2025 (in thousands) | % of Revenues 2025 | 3 Months 2024 (in thousands) | % of Revenues 2024 | 6 Months 2025 (in thousands) | % of Revenues 2025 | 6 Months 2024 (in thousands) | % of Revenues 2024 | | :-------------------------- | :--------------------------- | :----------------- | :--------------------------- | :----------------- | :--------------------------- | :----------------- | :--------------------------- | :----------------- | | Compensation and benefits | $252,110 | 69% | $197,873 | 75% | $463,659 | 69% | $362,348 | 75% | | Non-compensation expenses | $52,637 | 14% | $46,645 | 18% | $110,769 | 16% | $93,853 | 19% | | **Total operating expenses** | **$304,747** | **83%** | **$244,518** | **92%** | **$574,428** | **85%** | **$456,201** | **95%** | - Total operating expenses increased by **26% to $574.4 million** for H1 2025, primarily due to higher compensation and benefits expenses[161](index=161&type=chunk)[162](index=162&type=chunk)[166](index=166&type=chunk)[167](index=167&type=chunk) - As a percentage of revenues, total operating expenses **decreased from 95% to 85%** for H1 2025, indicating improved operating leverage[161](index=161&type=chunk)[162](index=162&type=chunk) [Compensation and Benefits Expenses](index=29&type=section&id=Compensation%20and%20Benefits%20Expenses_MD&A) - Compensation and benefits expenses increased due to **increased headcount** and a higher discretionary bonus accrual, reflecting higher revenues[166](index=166&type=chunk)[167](index=167&type=chunk) - As a percentage of revenues, compensation and benefits **decreased from 75% to 69%** for H1 2025, indicating improved efficiency[166](index=166&type=chunk)[167](index=167&type=chunk) [Non-Compensation Expenses](index=30&type=section&id=Non-Compensation%20Expenses_MD&A) - Non-compensation expenses increased by **18% to $110.8 million** for H1 2025, primarily due to increased travel, communication, and technology expenses[169](index=169&type=chunk)[170](index=170&type=chunk) - As a percentage of revenues, non-compensation expenses **decreased from 19% to 16%** for H1 2025[169](index=169&type=chunk)[170](index=170&type=chunk) [Other Income and Expenses](index=30&type=section&id=Other%20Income%20and%20Expenses_MD&A) - Other income and expenses increased to **$9.7 million** for H1 2025, driven by net gains on financial assets and earnings in MA Financial[172](index=172&type=chunk)[173](index=173&type=chunk) [Provision for Income Taxes](index=31&type=section&id=Provision%20for%20Income%20Taxes_MD&A) - Income tax expense for Q2 2025 was **$17.4 million** on pre-tax income of $64.1 million[175](index=175&type=chunk) - For H1 2025, income tax expense was **$6.7 million** on pre-tax income of $107.2 million, a significant change from a benefit in 2024[176](index=176&type=chunk) [Liquidity and Capital Resources](index=31&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains strong liquidity through advisory fees, cash, investments, and credit facilities [Regulatory Capital](index=32&type=section&id=Regulatory%20Capital) - U.S. Broker Dealer's net capital of **$230,593 thousand** as of June 30, 2025, significantly exceeded its minimum requirement[187](index=187&type=chunk)[115](index=115&type=chunk) [Tax Receivable Agreement](index=32&type=section&id=Tax%20Receivable%20Agreement) - The company has a tax receivable agreement to pay eligible Managing Directors **85% of cash savings** from tax basis increases[188](index=188&type=chunk) - As of June 30, 2025, **$298.8 million is payable** under the agreement, with an estimated $31.6 million due within one year[191](index=191&type=chunk)[196](index=196&type=chunk) - Early termination or change of control could trigger accelerated payments based on assumptions[192](index=192&type=chunk) [Cash Flows](index=33&type=section&id=Cash%20Flows_MD&A) Summary of Cash Flows (Six Months Ended June 30) | Cash Flow Activity | 2025 (in thousands) | 2024 (in thousands) | | :------------------------------------ | :------------------ | :------------------ | | Operating Activities | $38,687 | -$25,036 | | Investing Activities | -$113,057 | $108,760 | | Financing Activities | -$117,796 | -$119,555 | | Net increase (decrease) in cash | -$190,663 | -$35,972 | | Cash, cash equivalents, and restricted cash, end of period | $222,516 | $151,243 | - Operating activities generated a net inflow of **$38.7 million** in H1 2025, a reversal from a $25.0 million outflow in H1 2024[193](index=193&type=chunk) - Investing activities resulted in a net outflow of **$113.1 million** in H1 2025, mainly due to net purchases of investments[193](index=193&type=chunk) - Financing activities resulted in a net outflow of **$117.8 million** in H1 2025, primarily for dividends and stock repurchases[193](index=193&type=chunk) [Contractual Obligations](index=34&type=section&id=Contractual%20Obligations) - The company has a total payable of **$298.8 million** under the tax receivable agreement[196](index=196&type=chunk) - Contractual obligations also include operating leases for corporate office space and an aircraft[197](index=197&type=chunk) [Market Risk and Credit Risk](index=34&type=section&id=Market%20Risk%20and%20Credit%20Risk) The company is not subject to significant market or credit risk due to its business model [Risks Related to Cash and Short-Term Investments](index=34&type=section&id=Risks%20Related%20to%20Cash%20and%20Short-Term%20Investments) - Cash and cash equivalents are primarily invested in **U.S. and U.K. sovereign debt** and money market securities[199](index=199&type=chunk) - Cash and short-term investments are not considered subject to **material market risks**[199](index=199&type=chunk) [Credit Risk](index=34&type=section&id=Credit%20Risk) - The company regularly reviews accounts receivable and maintains an **allowance for credit losses**[200](index=200&type=chunk) [Exchange Rate Risk](index=34&type=section&id=Exchange%20Rate%20Risk) - The company is exposed to exchange rate risk from non-U.S. dollar denominated assets and liabilities[201](index=201&type=chunk) - Other comprehensive income included gains of **$2.6 million** for H1 2025 from foreign currency fluctuations[201](index=201&type=chunk) - **No derivative instruments** are used to hedge foreign currency fluctuations[201](index=201&type=chunk) [Critical Accounting Policies and Estimates](index=35&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) This section outlines critical accounting policies requiring significant management judgment [Revenue and Expense Recognition](index=35&type=section&id=Revenue%20and%20Expense%20Recognition_MD&A) - Most advisory revenue is **recognized over time** as performance obligations are fulfilled[205](index=205&type=chunk)[206](index=206&type=chunk) - Transaction fees are **constrained until substantial completion** and specified conditions are met to prevent significant revenue reversal[207](index=207&type=chunk)[208](index=208&type=chunk) [Accounts Receivable and Allowance for Credit Losses](index=35&type=section&id=Accounts%20Receivable%20and%20Allowance%20for%20Credit%20Losses_MD&A) - Accounts receivable are presented net of an **allowance for credit losses**, determined by assessing collectability[210](index=210&type=chunk)[211](index=211&type=chunk) - Receivables are stratified into short-term and private capital advisory categories for separate evaluation[211](index=211&type=chunk) [Income Taxes](index=36&type=section&id=Income%20Taxes_MD&A) - Income taxes are accounted for under **ASC 740**, recognizing tax benefits/expenses on temporary differences and deferred tax assets[214](index=214&type=chunk) - The company applies a two-step approach for uncertain tax positions, with **no unrecognized tax benefits** recorded[215](index=215&type=chunk) [Recent Accounting Developments](index=36&type=section&id=Recent%20Accounting%20Developments_MD&A) - Refer to Note 3 for a discussion of recently issued accounting developments[216](index=216&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=36&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section refers to the market risk disclosures provided in Item 2, Management's Discussion and Analysis - Quantitative and qualitative disclosures about market risk are set forth in 'Item 2—Management's Discussion and Analysis of Financial Condition and Results of Operations—Market Risk and Credit Risk'[217](index=217&type=chunk) [Item 4. Controls and Procedures](index=36&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that the company's disclosure controls and procedures were effective as of June 30, 2025 - The CEO and CFO concluded that the company's disclosure controls and procedures were **effective** as of the end of the period[217](index=217&type=chunk) - **No material changes** in internal control over financial reporting occurred during the period[218](index=218&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=37&type=section&id=Item%201.%20Legal%20Proceedings) The company discloses ongoing legal proceedings, including an appeal and a dismissed class action lawsuit - The company is involved in judicial or regulatory proceedings, but believes no current proceedings would have a **significant adverse effect**[220](index=220&type=chunk) - An appeal is ongoing regarding a Delaware Court of Chancery order that found certain provisions of the **Stockholders Agreement invalid**[221](index=221&type=chunk) - Claims against Moelis entities in a class action lawsuit related to the **Archer Aviation merger were dismissed** by the Court[222](index=222&type=chunk) [Item 1A. Risk Factors](index=37&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the Risk Factors previously described in the company's Annual Report - **No material changes** to the Risk Factors described in the Annual Report on Form 10-K for the year ended December 31, 2024[223](index=223&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=37&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reports share repurchases during the quarter, with $61.1 million remaining under its program - **No unregistered sales** of equity securities occurred[224](index=224&type=chunk) Issuer Purchases of Equity Securities (Second Quarter 2025) | Period | Total Number of Shares Purchased | Average Price Paid per Share | Shares Purchased as Part of Publicly Announced Plans or Programs | Approximate Dollar Value of Shares that May Yet be Purchased Under the Plan or Programs | | :---------------- | :------------------------------- | :--------------------------- | :--------------------------------------------------------------- | :-------------------------------------------------------------------------------------- | | April 1 - April 30 | 9,796 | $52.12 | 9,796 | $62.0 million | | May 1 - May 31 | 20,988 | $53.26 | 17,232 | $61.1 million | | June 1 - June 30 | — | — | — | $61.1 million | | **Total** | **30,784** | **$52.90** | **27,028** | **$61.1 million** | - The share repurchase program, authorized for up to $100 million, had **$61.1 million remaining** as of June 30, 2025[226](index=226&type=chunk) [Item 3. Defaults Upon Senior Securities](index=38&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon senior securities during the period - No defaults upon senior securities[227](index=227&type=chunk) [Item 4. Mine Safety Disclosures](index=38&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[228](index=228&type=chunk) [Item 5. Other Information](index=38&type=section&id=Item%205.%20Other%20Information) The company reported no other information for the period - None[229](index=229&type=chunk) [Item 6. Exhibits](index=39&type=section&id=Item%206.%20Exhibits) This section lists all exhibits filed with the Form 10-Q - Includes organizational documents, incentive plan forms, related-party agreements, CEO/CFO Certifications, and Inline XBRL documents[230](index=230&type=chunk) [SIGNATURES](index=40&type=section&id=SIGNATURES) - Report signed by Kenneth Moelis (CEO) and Christopher Callesano (CFO) on July 24, 2025[233](index=233&type=chunk)