Core Insights - The OCIO (Outsourced Chief Investment Officer) model has seen significant growth, with assets under management (AUM) increasing over 2.6 times in the past decade, indicating a strong demand for outsourced investment management solutions [3][8][10] - The market is dominated by a few key players, with the top five institutions controlling 67% of the market share, particularly following the acquisition of Vanguard by Mercer, which has led to a rapid increase in Mercer’s AUM market share to over 30% [3][10] - The client base for OCIO services is diversifying, with a notable increase in the share of non-pension clients such as endowment funds, charitable foundations, and private wealth, which are expected to grow at a compound annual growth rate (CAGR) exceeding 10% over the next five years [3][17] OCIO Business Overview - OCIO services encompass a comprehensive range of functions including asset allocation, manager selection, portfolio decision execution, and risk management, tailored to meet the needs of institutional investors and high-net-worth families [7][10] - The OCIO model addresses the gap between asset owners' internal capabilities and their performance expectations, providing a systematic approach to enhance governance and efficiency [7][10] Market Dynamics - The OCIO market is primarily driven by corporate pension plans, which accounted for 61% of the market in 2023, but there is a growing trend towards non-pension clients, indicating a shift in market dynamics [3][17] - The overall AUM in the OCIO sector is projected to grow at a CAGR of 7.9%-8%, with increasing penetration among non-traditional institutional clients [17] Competitive Landscape - Major players like JP Morgan, Mercer, BlackRock, and Goldman Sachs are adopting distinct strategies to capture market share, with varying focuses on technology, ESG integration, and client customization [3][10][38] - The acquisition of Vanguard by Mercer is a significant event in the industry, enhancing Mercer’s capabilities in alternative asset management and solidifying its position as the largest OCIO service provider globally [48][51] Client Segmentation - Different client types, including pension funds, foundations, family offices, and sovereign wealth funds, have unique investment needs and risk profiles, leading to tailored OCIO service models [12][17] - Non-profit organizations and endowment funds are increasingly recognized as critical growth drivers for OCIO services, with a high percentage of providers considering them essential for future growth [26][17] Future Opportunities - The OCIO sector is expected to see growth opportunities in Southeast Asian sovereign funds and healthcare systems, as well as through the optimization of asset allocation models [3][10] - The demand for alternative assets and complex investment strategies is rising, necessitating OCIO providers to enhance their capabilities in these areas [13][17]

Founder of Dividend Mantra. Founder of Mr. Free At 33. Co-Founder of Dividends & Income. I started blogging about my journey to financial independence back in 2011. By living well below my means and intelligently investing my hard-earned capital, I went from below broke at age 27 to financially free at 33 years old. I regularly create content on dividend growth investing, living off of dividends, undervalued high-quality dividend growth stocks, high-yield situations, and other long-term investment opportuni ...

Investors in Marsh & McLennan Companies (MMC) need to pay close attention to the stock based on moves in the options market lately. That is because the Sept 19, 2025 $115.00 Call had some of the highest implied volatility of all equity options today.What is Implied Volatility?Implied volatility shows how much movement the market is expecting in the future. Options with high levels of implied volatility suggest that investors in the underlying stocks are expecting a big move in one direction or the other. It ...

Core Viewpoint - Marsh & McLennan Companies, Inc. is recognized as the leading global insurance broker, with a positive outlook on its performance due to favorable market conditions transitioning from rate headwinds to tailwinds [1]. Company Summary - The company has been a long-time investment since 2016, benefiting from improved market conditions [1]. - The investment philosophy emphasizes the importance of knowledge compounding and strategic thinking, inspired by notable investors [1]. Industry Context - The insurance brokerage industry is experiencing a shift that is favorable for companies like Marsh & McLennan, indicating potential growth opportunities [1].

Core Insights - Marsh & McLennan Companies, Inc. (MMC) reported second-quarter 2025 adjusted earnings per share of $2.72, exceeding the Zacks Consensus Estimate by 2.3% and reflecting an 11% year-over-year increase [1][9] - Consolidated revenues reached $6.97 billion, marking a 12% year-over-year improvement and a 4% increase on an underlying basis, also surpassing the consensus mark by 0.8% [1][9] Financial Performance - Total operating expenses rose 12.4% year over year to $5.1 billion, driven by increased compensation and benefits costs [3] - Adjusted operating income improved 14% year over year to $2.06 billion, beating the estimate of $2.05 billion, with an adjusted operating margin of 29.5%, up 50 basis points year over year [4] Segment Performance Risk and Insurance Services - Revenues for this segment were $4.63 billion, a 15% year-over-year increase and 4% on an underlying basis, beating the Zacks Consensus Estimate by 0.4% [4] - Adjusted operating income for Risk and Insurance Services advanced 15.7% year over year to $1.6 billion, exceeding the consensus mark by 2.5% [4] - Marsh's revenues within this segment rose 18% year over year to $3.8 billion, while Guy Carpenter's revenues increased 5% year over year to $677 million [5][6] Consulting - The Consulting unit's revenues grew 7% year over year to $2.37 billion, surpassing the Zacks Consensus Estimate by 1.3% [7] - Adjusted operating income for Consulting climbed 9.4% year over year to $479 million, although it missed the consensus mark by 2.6% [7] - Mercer, a unit within Consulting, reported a 9% year-over-year revenue increase to $1.5 billion, beating the consensus estimate by 2.8% [8] Financial Position - As of June 30, 2025, Marsh & McLennan had cash and cash equivalents of $1.7 billion, down from $2.4 billion at the end of 2024, while total assets increased to $58.6 billion [11] - Long-term debt decreased to $19 billion from $19.4 billion, and total equity rose to $16 billion from $13.5 billion at the end of 2024 [11] Capital Deployment - In the second quarter, Marsh & McLennan repurchased 1.4 million shares for $300 million [13]

Core Insights - Marsh & McLennan (MMC) reported $6.97 billion in revenue for the quarter ended June 2025, a year-over-year increase of 12.1% and an EPS of $2.72 compared to $2.41 a year ago, exceeding Zacks Consensus Estimates for both revenue and EPS [1] Financial Performance - The reported revenue of $6.97 billion surpassed the Zacks Consensus Estimate of $6.92 billion, resulting in a surprise of +0.75% [1] - EPS also exceeded expectations with a surprise of +2.26%, as the consensus EPS estimate was $2.66 [1] Key Metrics - Organic/Underlying Revenue Growth for Total Risk and Insurance Service was 4%, slightly below the average estimate of 4.5% [4] - Organic/Underlying Revenue Growth for Consolidated was 4%, compared to the estimated 4.3% [4] - Organic/Underlying Revenue Growth for Guy Carpenter was 5%, exceeding the average estimate of 4.2% [4] - Organic/Underlying Revenue Growth for Total Marsh was 5%, close to the average estimate of 5.2% [4] Regional Revenue Breakdown - Revenue from Risk and Insurance services in APAC was $409 million, matching the average estimate of $409.54 million, with a year-over-year change of +4.6% [4] - Revenue from Risk and Insurance services in EMEA was $1.01 billion, surpassing the estimated $964.12 million, reflecting a +10.3% year-over-year change [4] - Revenue from Risk and Insurance services in the US and Canada was $2.3 billion, aligning with the average estimate, showing a significant year-over-year increase of +26.1% [4] - Revenue from Risk and Insurance services in Latin America was $132 million, below the estimated $143.49 million, indicating a -3.7% year-over-year change [4] Consulting Revenue - Revenue from Consulting was $2.37 billion, exceeding the average estimate of $2.34 billion, with a year-over-year change of +7% [4] Overall Revenue Performance - Total revenue from Risk and Insurance services was $4.63 billion, slightly above the estimated $4.61 billion, representing a +15% year-over-year change [4] - Revenue from Fiduciary Interest Income was $99 million, below the average estimate of $101.24 million, reflecting a significant year-over-year decline of -20.8% [4] - Corporate eliminations reported a revenue of -$22 million, worse than the average estimate of -$16.05 million, but showing a year-over-year change of +29.4% [4] Stock Performance - Shares of Marsh & McLennan have returned -1.1% over the past month, while the Zacks S&P 500 composite increased by +4.2% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating potential performance in line with the broader market in the near term [3]

Financial Data and Key Metrics Changes - Consolidated revenue increased by 12% to $7 billion, with underlying revenue growth of 4% [16][20] - Adjusted operating income rose by 14% year-over-year, with adjusted EPS growing by 11% to $2.72 [7][21] - Adjusted operating margin improved by 50 basis points to 29.5% [20] Business Line Data and Key Metrics Changes - Risk and Insurance Services (RIS) revenue was $4.6 billion, up 15% year-over-year, with 4% underlying growth [21][16] - Marsh's revenue increased by 18% to $3.8 billion, with 5% underlying growth [22][16] - Guy Carpenter's revenue grew by 7% to $677 million, maintaining 5% underlying growth [23][16] - Consulting segment revenue was $2.4 billion, up 7% or 3% on an underlying basis [24][16] - Mercer's revenue was $1.5 billion, up 9% or 3% on an underlying basis [25][16] - Oliver Wyman's revenue increased by 5% to $873 million, with 3% underlying growth [27][16] Market Data and Key Metrics Changes - Commercial insurance rates decreased by 4% in Q2, following a 3% decline in Q1 [12][16] - Global casualty rates increased by 4%, with US excess casualty up 18% [13][16] - Workers' compensation rates decreased by 4%, while global property rates decreased by 7% year-over-year [14][16] Company Strategy and Development Direction - The company aims for mid-single-digit underlying revenue growth and continued margin expansion [17][32] - Focus on advising clients on strategies to navigate geopolitical instability and supply chain risks [8][18] - Commitment to addressing the challenges posed by the US litigation environment and rising liability insurance costs [10][11] Management's Comments on Operating Environment and Future Outlook - The global economic outlook remains uncertain, with various geopolitical and economic challenges impacting clients [7][8] - Management expressed confidence in the company's resilience and ability to deliver value despite economic uncertainties [18][32] - The company anticipates continued growth in adjusted EPS and margin expansion for the remainder of 2025 [17][32] Other Important Information - The company announced a 10% increase in its quarterly dividend to $0.90 and completed $300 million in share repurchases [16][32] - Total debt at the end of the quarter was $19.7 billion, with a cash position of $1.7 billion [31][32] Q&A Session Questions and Answers Question: Are you seeing upward pressure on pricing in the insurance market? - Management noted that insurance and reinsurance markets continue to soften, particularly in property, but excess casualty rates are under pressure due to the US litigation environment [38][39] Question: Can you provide more detail on the wealth and career components of organic growth? - Management explained that the wealth business is driven by AUM, but the defined benefits pension consulting work is in structural decline, impacting organic revenue growth [43][48] Question: How does the macroeconomic environment affect the RIS segment? - Management agreed that nominal GDP is a significant factor, and noted that project work is being deferred in the US due to economic uncertainty [57][58] Question: What is the outlook for Marsh International growth? - Management expressed confidence in the strong growth in international markets, despite pricing headwinds, and highlighted the company's capabilities in various regions [76][78] Question: How are rising medical costs impacting your business? - Management indicated that rising healthcare costs are a stress point for clients, but the majority of their business operates on a fixed fee basis, limiting direct impacts from medical inflation [96][99] Question: What are the implications of AI technology on your business? - Management is optimistic about the potential of AI to create efficiencies and improve insights, and is actively investing in technology to support these initiatives [100][102]

Financial Data and Key Metrics Changes - Consolidated revenue increased by 12% to $7 billion, with underlying revenue growth of 4% [15][19] - Adjusted operating income rose by 14% year-over-year, with an adjusted operating margin increase of 50 basis points to 29.5% [6][19] - Adjusted EPS grew by 11% to $2.72, while GAAP EPS was $2.45 [19][20] Business Line Data and Key Metrics Changes - Risk and Insurance Services (RIS) revenue was $4.6 billion, up 15% year-over-year, with 4% underlying growth [20][22] - Marsh's revenue increased by 18% to $3.8 billion, with 5% underlying growth [21][22] - Guy Carpenter's revenue was $677 million, up 7% year-over-year, with 5% underlying growth [22] - Consulting segment revenue was $2.4 billion, up 7% or 3% on an underlying basis [23][24] - Mercer reported revenue of $1.5 billion, up 9% or 3% on an underlying basis [24][25] - Oliver Wyman's revenue was $873 million, up 5% or 3% on an underlying basis [26] Market Data and Key Metrics Changes - Commercial insurance rates decreased by 4% in Q2, driven by property insurance [11][12] - Global casualty rates increased by 4%, with US excess casualty up 18% [12][13] - Workers' compensation rates decreased by 4%, while global property rates decreased by 7% year-over-year [13][14] Company Strategy and Development Direction - The company aims for mid-single-digit underlying revenue growth and solid growth in adjusted EPS for 2025 [16][32] - Focus on advising clients on strategies to navigate geopolitical instability and supply chain risks [7][8] - Commitment to addressing the challenges posed by the litigation environment in the US [9][10] Management's Comments on Operating Environment and Future Outlook - The global economic outlook remains uncertain, with various geopolitical and economic challenges impacting clients [6][7] - Management expressed confidence in the company's resilience and ability to support clients during complex conditions [16][32] - The company anticipates continued pressure on pricing in the insurance market, particularly in property and casualty [37][41] Other Important Information - The company announced a 10% increase in its quarterly dividend to $0.90 and completed $300 million in share repurchases [15][32] - Total debt at the end of the quarter was $19.7 billion, with a cash position of $1.7 billion [31][32] Q&A Session Questions and Answers Question: Are you seeing upward pressure on pricing in the insurance market? - Management indicated that the insurance and reinsurance markets continue to soften, particularly in property, but noted rising costs in excess casualty due to the litigation environment [37][38] Question: Can you provide more detail on the wealth and career components of Mercer? - Management explained that the wealth business is diverse, with growth driven by investment advisory services, while the career segment faced challenges due to economic uncertainty affecting project demand [43][45] Question: How does the current macro environment affect the RIS segment? - Management acknowledged that the macro environment, including declining P&C pricing and slowing economic growth, impacts project work and hiring, but expressed confidence in their execution [59][61] Question: What is the outlook for M&A and IPO activity? - Management noted that while M&A and IPOs are components of the macro picture, uncertainty remains, and it is too early to predict a meaningful uptick in these activities [67][69] Question: How is the company addressing rising medical costs? - Management highlighted that rising healthcare costs are a stress point for clients, but much of their business operates on a fee basis, which mitigates direct impacts from medical inflation [99][100] Question: What are the implications of AI technology on the business? - Management expressed excitement about AI's potential to create efficiencies and improve insights, indicating ongoing efforts to integrate these technologies into their operations [102][104]

[PART I. FINANCIAL INFORMATION](index=4&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Financial Statements](index=4&type=section&id=Item%201.%20Financial%20Statements.) This section presents unaudited consolidated financial statements for the three and six months ended June 30, 2025, including income, balance sheet, cash flow, and equity statements Consolidated Statements of Income Highlights (Q2 & H1 2025 vs 2024) | (In millions, except per share data) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | **Revenue** | $6,974 | $6,221 | $14,035 | $12,694 | | **Operating Income** | $1,829 | $1,642 | $3,834 | $3,567 | | **Net Income Attributable to the Company** | $1,211 | $1,125 | $2,592 | $2,525 | | **Diluted EPS** | $2.45 | $2.27 | $5.23 | $5.08 | - Total assets increased to **$58.6 billion** as of June 30, 2025, from **$56.5 billion** at December 31, 2024. Total equity grew to **$16.0 billion** from **$13.5 billion** over the same period[15](index=15&type=chunk)[17](index=17&type=chunk) - Net cash provided by operations for the first six months of 2025 was **$1,049 million**, a significant increase from **$434 million** in the corresponding period of 2024[19](index=19&type=chunk) [Notes to Consolidated Financial Statements](index=10&type=section&id=NOTES%20TO%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) This section details accounting principles, key estimates, operating segments, acquisition impacts, debt structure, and significant legal contingencies - The company operates through two segments: **Risk and Insurance Services (RIS)**, comprising Marsh and Guy Carpenter, and **Consulting**, comprising Mercer and Oliver Wyman Group[22](index=22&type=chunk)[23](index=23&type=chunk)[24](index=24&type=chunk) Disaggregated Revenue by Segment (Q2 2025 vs Q2 2024) | (In millions) | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | **Total Risk and Insurance Services** | $4,625 | $4,022 | | **Total Consulting** | $2,371 | $2,216 | - For the six months ended June 30, 2025, the company completed **7 acquisitions** for a total consideration of **$148 million**. Acquisition-related expenses were **$137 million**, including **$114 million** for the integration of McGriff[76](index=76&type=chunk)[83](index=83&type=chunk) - The company is involved in ongoing litigation related to Greensill Capital. A settlement was reached with White Oak in May 2025, covered by E&O insurance, but potential loss from other claims by Credit Suisse and Greensill Bank AG is not estimable[152](index=152&type=chunk)[153](index=153&type=chunk)[156](index=156&type=chunk) - Total debt outstanding was **$19.7 billion** as of June 30, 2025. In March 2025, the company repaid **$500 million** of 3.50% senior notes at maturity[134](index=134&type=chunk)[138](index=138&type=chunk) [Management's Discussion and Analysis (MD&A)](index=40&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial performance, highlighting Q2 2025 consolidated revenue growth driven by RIS and Consulting segments, and reviews liquidity, capital resources, and capital return activities Q2 2025 Revenue Growth Breakdown | Metric | Percentage Change | | :--- | :--- | | **Consolidated Revenue (GAAP)** | 12% | | **Underlying Revenue (Non-GAAP)** | 4% | | Contribution from Acquisitions | 8% | | Impact of Foreign Currency | 1% | - Risk and Insurance Services (RIS) revenue grew **15%** in Q2 2025 (**4%** underlying), with Marsh up **18%** (**5%** underlying) and Guy Carpenter up **7%** (**5%** underlying), primarily driven by the McGriff acquisition[204](index=204&type=chunk)[207](index=207&type=chunk)[209](index=209&type=chunk) - Consulting revenue increased **7%** in Q2 2025 (**3%** underlying), with Mercer growing **9%** (**3%** underlying) driven by Health and Wealth, and Oliver Wyman Group growing **5%** (**3%** underlying)[217](index=217&type=chunk)[219](index=219&type=chunk)[222](index=222&type=chunk) - Interest expense increased significantly to **$243 million** in Q2 2025 from **$156 million** in Q2 2024, primarily due to increased long-term debt for the McGriff acquisition and higher interest rates[230](index=230&type=chunk)[231](index=231&type=chunk) - In H1 2025, the company returned **$1.41 billion** to shareholders through **$600 million** in share repurchases (**2.7 million shares**) and **$810 million** in dividends[266](index=266&type=chunk)[267](index=267&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=57&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) This section outlines the company's exposure to market risks, including interest rate, foreign currency, and equity price risks, and details its sensitivity and risk management strategies - A **10%** change (**32 basis points**) in short-term interest rates would impact annual interest income, including from fiduciary funds, by approximately **$22 million**[286](index=286&type=chunk) - Approximately **51%** of total revenue is exposed to foreign currency risk. A **10%** adverse movement of major currencies against the U.S. dollar would decrease full-year net operating income by an estimated **$105 million**[289](index=289&type=chunk)[290](index=290&type=chunk) - The company holds over **$325 million** in equity investments (public, private, and private equity funds) that are subject to market value declines[292](index=292&type=chunk) [Controls & Procedures](index=58&type=section&id=Item%204.%20Controls%20%26%20Procedures) The CEO and CFO concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting - The Chief Executive Officer and Chief Financial Officer concluded that the company's disclosure controls and procedures are effective as of June 30, 2025[294](index=294&type=chunk) - No material changes to the company's internal control over financial reporting were identified during the second quarter of 2025[295](index=295&type=chunk) [PART II. OTHER INFORMATION](index=59&type=section&id=PART%20II.%20OTHER%20INFORMATION) [Legal Proceedings](index=59&type=section&id=Item%201.%20Legal%20Proceedings) This section incorporates by reference detailed legal proceedings from Note 17, confirming the company's involvement in various normal course legal, administrative, and regulatory actions - Information regarding legal proceedings is incorporated by reference from Note 17, "Claims, Lawsuits and Other Contingencies," in Part I of the report[297](index=297&type=chunk) [Risk Factors](index=59&type=section&id=Item%201A.%20Risk%20Factors) This section states no material changes to risk factors from the Annual Report on Form 10-K for the year ended December 31, 2024, directing readers to that filing for comprehensive details - There are no material changes from the risk factors discussed in the Annual Report on Form 10-K for the year ended December 31, 2024[298](index=298&type=chunk) [Issuer Repurchases of Equity Securities](index=59&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section details the company's share repurchase activities, including Q2 2025 repurchases of **1.33 million shares** for **$300 million**, and the remaining authorization Share Repurchases in Q2 2025 | Period | Total Shares Purchased | Average Price Paid per Share | Total Cost (approx.) | | :--- | :--- | :--- | :--- | | April 2025 | 461,401 | $226.56 | $104.5 million | | May 2025 | 428,882 | $227.92 | $97.7 million | | June 2025 | 441,583 | $221.28 | $97.7 million | | **Total Q2** | **1,331,866** | **$225.25** | **$300.0 million** | - As of June 30, 2025, the company had approximately **$1.7 billion** remaining under its share repurchase authorization, which has no time limit[300](index=300&type=chunk)[301](index=301&type=chunk)

[Financial Highlights](index=1&type=section&id=Financial%20Highlights) [Consolidated Results (Q2 2025)](index=1&type=section&id=Consolidated%20Results%20%28Q2%202025%29) Marsh McLennan achieved solid Q2 2025 results with 12% revenue growth to $7.0 billion, 4% underlying growth, and 14% adjusted operating income increase - CEO John Doyle highlighted the quarter's solid performance, attributing the **12% revenue growth** to continued business momentum and the impact of acquisitions. He also noted a **10% increase** in the company's dividend[2](index=2&type=chunk) Q2 2025 Consolidated Financial Performance | Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $7.0 billion | $6.2 billion | 12% | | Underlying Revenue | - | - | 4% | | Operating Income (GAAP) | $1.8 billion | $1.6 billion | 11% | | Adjusted Operating Income | $2.1 billion | $1.8 billion | 14% | | Net Income (attributable to Company) | $1.2 billion | $1.1 billion | 8% | | EPS (GAAP) | $2.45 | $2.27 | 8% | | Adjusted EPS | $2.72 | $2.44 | 11% | [Consolidated Results (H1 2025)](index=2&type=section&id=Consolidated%20Results%20%28H1%202025%29) H1 2025 consolidated revenue grew 11% to $14.0 billion with 4% underlying growth, and adjusted EPS increased 8% to $5.78 H1 2025 Consolidated Financial Performance | Metric | H1 2025 | H1 2024 | % Change | | :--- | :--- | :--- | :--- | | Revenue | $14.0 billion | $12.7 billion | 11% | | Underlying Revenue | - | - | 4% | | Operating Income (GAAP) | $3.8 billion | $3.6 billion | 7% | | Adjusted Operating Income | $4.3 billion | $3.9 billion | 11% | | Net Income (attributable to Company) | $2.6 billion | $2.5 billion | 3% | | EPS (GAAP) | $5.23 | $5.08 | 3% | | Adjusted EPS | $5.78 | $5.36 | 8% | [Segment Performance](index=2&type=section&id=Segment%20Performance) [Risk & Insurance Services](index=2&type=section&id=Risk%20%26%20Insurance%20Services) Risk & Insurance Services saw strong Q2 2025 revenue growth of 15% to $4.6 billion (4% underlying) and 16% adjusted operating income increase Risk & Insurance Services Financial Summary | Period | Revenue (GAAP) | Underlying Revenue Growth | Adjusted Operating Income | Adj. Op. Income Growth | | :--- | :--- | :--- | :--- | :--- | | Q2 2025 | $4.6 billion | 4% | $1.6 billion | 16% | | H1 2025 | $9.4 billion | 4% | $3.5 billion | 12% | [Marsh](index=2&type=section&id=Marsh) - Marsh's revenue was **$3.8 billion** in Q2 2025, an increase of **18% (5% underlying)**. Growth was driven by a **4% rise** in U.S./Canada and **7% growth** in International operations, with EMEA showing strong performance at **8% underlying growth**[7](index=7&type=chunk) [Guy Carpenter](index=2&type=section&id=Guy%20Carpenter) - Guy Carpenter's revenue in Q2 2025 was **$677 million**, up **7% (5% underlying)**. For the first six months, underlying revenue growth was also **5%**[8](index=8&type=chunk) [Consulting](index=2&type=section&id=Consulting) Consulting segment revenue grew 7% to $2.4 billion (3% underlying) in Q2 2025, with adjusted operating income up 9% to $479 million Consulting Financial Summary | Period | Revenue (GAAP) | Underlying Revenue Growth | Adjusted Operating Income | Adj. Op. Income Growth | | :--- | :--- | :--- | :--- | :--- | | Q2 2025 | $2.4 billion | 3% | $479 million | 9% | | H1 2025 | $4.7 billion | 4% | $970 million | 9% | [Mercer](index=2&type=section&id=Mercer) - Mercer's Q2 revenue was **$1.5 billion**, an increase of **9% (3% underlying)**. Health revenue showed strong underlying growth at **7%**, while Wealth grew **2%** and Career declined **5%**[10](index=10&type=chunk) [Oliver Wyman](index=2&type=section&id=Oliver%20Wyman) - Oliver Wyman's revenue in Q2 2025 was **$873 million**, an increase of **5% (3% underlying)**. For the first six months, underlying revenue growth was **4%**[11](index=11&type=chunk) [Capital Management](index=2&type=section&id=Capital%20Management) The company actively returned capital to shareholders via share repurchases and a significant dividend increase [Share Repurchases and Dividends](index=2&type=section&id=Share%20Repurchases%20and%20Dividends) Marsh McLennan repurchased **$300 million** in Q2 2025 shares and increased the quarterly dividend by **10%** to **$0.900** per share - Share Repurchases: - Q2 2025: **1.4 million shares** for **$300 million** - H1 2025: **2.7 million shares** for **$600 million**[12](index=12&type=chunk) - The Board of Directors increased the quarterly dividend by **10%** to **$0.900** per share, payable on August 15, 2025[12](index=12&type=chunk) [Financial Statements](index=5&type=section&id=Financial%20Statements) [Consolidated Statements of Income](index=5&type=section&id=Consolidated%20Statements%20of%20Income) Consolidated Statements of Income show increased revenue and operating income for Q2 and H1 2025, with Q2 revenue reaching **$6.97 billion** Consolidated Income Statement Highlights (In millions) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenue | $6,974 | $6,221 | $14,035 | $12,694 | | Operating income | $1,829 | $1,642 | $3,834 | $3,567 | | Income before income taxes | $1,646 | $1,565 | $3,473 | $3,436 | | Net income attributable to the Company | $1,211 | $1,125 | $2,592 | $2,525 | | Diluted EPS | $2.45 | $2.27 | $5.23 | $5.08 | [Consolidated Balance Sheets](index=12&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, the balance sheet shows strong total assets of **$58.6 billion** and increased total equity of **$16.0 billion** Key Balance Sheet Items (In millions) | Metric | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $1,677 | $2,398 | | Total current assets | $23,334 | $22,117 | | Goodwill and intangible assets | $28,689 | $28,126 | | Total Assets | $58,555 | $56,481 | | Long-term debt | $18,960 | $19,428 | | Total Liabilities | $42,579 | $42,946 | | Total Equity | $15,976 | $13,535 | [Consolidated Statements of Cash Flows](index=13&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) H1 2025 net cash from operations significantly increased to **$1.05 billion**, with major cash uses for dividends and share repurchases Key Cash Flow Items - Six Months Ended June 30 (In millions) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operations | $1,049 | $434 | | Net cash used for financing activities | $(1,833) | $(384) | | Net cash used for investing activities | $(95) | $(783) | | Purchase of treasury shares | $(600) | $(600) | | Dividends paid | $(810) | $(706) | [Supplemental Information and Non-GAAP Reconciliations](index=6&type=section&id=Supplemental%20Information%20and%20Non-GAAP%20Reconciliations) [Revenue Analysis](index=6&type=section&id=Revenue%20Analysis) Q2 2025 revenue analysis shows **12% GAAP growth**, with **8%** from acquisitions and **4%** underlying growth after currency impact Q2 2025 Components of Revenue Change | Segment | GAAP % Change | Currency Impact | Acq./Disp. Impact | Underlying Revenue % | | :--- | :--- | :--- | :--- | :--- | | Risk & Insurance Services | 15% | 1% | 10% | 4% | | Consulting | 7% | 1% | 3% | 3% | | **Total Company** | **12%** | **1%** | **8%** | **4%** | - The acquisition of McGriff was a significant driver of the 'Acquisitions/Dispositions' impact, particularly within the Marsh U.S./Canada division, which accounted for **22 percentage points** of its **26% GAAP revenue growth**[24](index=24&type=chunk) [Reconciliation of Non-GAAP Measures](index=8&type=section&id=Reconciliation%20of%20Non-GAAP%20Measures) The company reconciles GAAP to non-GAAP figures, adjusting Q2 2025 GAAP operating income of **$1.83 billion** to **$2.06 billion** adjusted operating income - Starting in Q1 2025, the company modified its non-GAAP calculations to exclude the impact of intangible amortization and other net benefit credits to better represent operating performance[34](index=34&type=chunk) Q2 2025 Reconciliation of GAAP to Adjusted Operating Income (In millions) | Metric | Amount | | :--- | :--- | | GAAP Operating income | $1,829 | | Total noteworthy items (restructuring, acquisition costs, etc.) | $88 | | Identified intangible amortization expense | $140 | | **Adjusted operating income** | **$2,057** | Q2 2025 Reconciliation of GAAP to Adjusted EPS | Metric | Per Share Amount | | :--- | :--- | | GAAP EPS | $2.45 | | Operating income adjustments & other items (net of tax) | $0.27 | | **Adjusted EPS** | **$2.72** | [Forward-Looking Statements and Risk Factors](index=4&type=section&id=Forward-Looking%20Statements%20and%20Risk%20Factors) This section outlines forward-looking statements and significant risks that could materially affect the company's future performance [Key Risk Factors](index=4&type=section&id=Key%20Risk%20Factors) Key risk factors include macroeconomic instability, litigation, cybersecurity threats, regulatory changes, and acquisition integration challenges - The company cautions that forward-looking statements are subject to inherent risks and uncertainties[16](index=16&type=chunk) - Identified risks include: - Geopolitical or macroeconomic conditions (wars, inflation, recessions) - Lawsuits from errors and omissions (E&O) or breaches of fiduciary duty - Ransomware and other cyber attacks - Ability to attract and retain talent - Competitive pressures and digital disruption - Ability to successfully integrate acquisitions, such as McGriff[18](index=18&type=chunk)