Core Insights - Perella Weinberg Partners has strengthened its healthcare services capabilities by appointing Suraj Tolani as an Advisory Partner [1][3] - Mr. Tolani previously served as a Managing Director at J.P. Morgan, focusing on the healthcare services sector [2] - The CEO of Perella Weinberg, Andrew Bednar, emphasized Mr. Tolani's proven track record and deep understanding of the healthcare industry's evolving landscape [3] Company Overview - Perella Weinberg Partners is a leading global independent advisory firm that provides strategic and financial advice to a diverse client base, including corporations, financial sponsors, governments, and sovereign wealth funds [4] - The firm offers a wide range of advisory services across active industry sectors and global markets, employing approximately 700 individuals across various offices [4]

Group 1 - Perella Weinberg (NASDAQ: PWP) is a boutique advisory firm specializing in mergers & acquisitions (M&A), restructuring, capital markets, shareholder engagement, and private funds [1] - M&A is the primary revenue generator for PWP, complemented by a strong restructuring business that performs well relative to its size [1]

Core Insights - Perella Weinberg Partners (PWP) reported strong second quarter results, exceeding analyst estimates with non-GAAP EPS of $0.09 and GAAP revenue of $155.3 million, despite a significant year-on-year decline in revenue due to the absence of a large one-off transaction from the previous year [1][5][10] Financial Performance - Non-GAAP EPS for Q2 2025 was $0.09, surpassing the estimate of $0.05, while GAAP revenue was $155.3 million compared to an estimate of $140.7 million [2] - Year-on-year, non-GAAP EPS decreased by 79.1% from $0.43 in Q2 2024, and GAAP revenue fell by 42.9% from $272.0 million [2] - The operating margin (non-GAAP) dropped to 9.6% from 23.0% a year earlier, indicating tighter profitability [2][6] Business Model and Strategy - PWP operates as an independent advisor focusing on M&A, capital raising, and restructuring, emphasizing long-term client relationships and high-value strategic advice [3] - The firm is diversifying its advisory offerings and expanding into fast-growing segments like GP-led secondaries, while managing compensation costs and sustaining shareholder returns through buybacks and dividends [4][10] Recent Developments - PWP announced the acquisition of Devon Park Advisors, enhancing its advisory services for private fund sponsors and asset managers, with the deal expected to close in early Q4 [7] - The firm returned $145.2 million to equity holders through share buybacks and dividends in the first half of 2025, maintaining a quarterly dividend of $0.07 per share [8][9] Outlook - Management noted a robust start to Q3 2025 with improved client activity and a healthier deal environment, while the integration of Devon Park Advisors is anticipated to drive future revenue growth [10][11]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 _____________________________________________________________________________________________________________________________________________________________________ FORM 10-Q _____________________________________________________________________________________________________________________________________________________________________ (Mark One) x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 ...

Perella Weinberg Partners (PWP) Q2 2025 Earnings Call August 01, 2025 09:00 AM ET Speaker0morning, everyone, and welcome to the Pirella Weinberg Partners Second Quarter twenty twenty five Earnings Conference Call. Currently, all callers have been placed in a listen only mode. And following management's prepared remarks, the call will be open for your questions. And please be advised that today's call is being recorded. I will now turn the call over to Taylor Reinhart, Head of Communications and Marketing.Ms ...

Acquisition of Devon Park Advisors - Perella Weinberg Partners has announced the acquisition of Devon Park Advisors, a GP-led secondaries advisory firm, which will enhance its service offerings to alternative asset managers [4][8] - The acquisition is expected to be completed in early Q4 2025, pending regulatory approval [4] Financial Overview - Second Quarter - For Q2 2025, Perella Weinberg reported revenues of $155.3 million, a decrease of 43% from $272.0 million in Q2 2024 [9] - The adjusted pre-tax income for Q2 2025 was $12 million, with GAAP pre-tax income at $6 million [6] - The company experienced a significant decline in M&A contributions, although financing and capital solutions activity increased [9] Financial Overview - First Half - For the first half of 2025, revenues totaled $367.1 million, down 2% from $374.1 million in the same period of 2024 [9] - Adjusted pre-tax income for the first half was $33 million, while GAAP pre-tax income was $18 million [6] Talent Investment - The company has accelerated investments in talent, adding six partners and six managing directors year-to-date, with plans for additional hires [6][8] - Devon Park's team of 15 advisory professionals will integrate into Perella Weinberg's Private Funds Advisory business [7] Capital Management - As of June 30, 2025, Perella Weinberg had a strong balance sheet with $145 million in cash and no debt [17] - The firm returned over $145 million to equity holders through share repurchases and dividends [18][19]

Financial Performance - Revenues for the three months ended March 31, 2025, were $211.8 million, a 107% increase from $102.1 million in the same period of 2024, driven by increased M&A and financing activities [120]. - Operating income for the three months ended March 31, 2025, was $11.7 million, a significant recovery from an operating loss of $53.6 million in the same period of 2024 [119]. - Net income attributable to Perella Weinberg Partners for the three months ended March 31, 2025, was $17.3 million, compared to a net loss of $35.8 million in the prior year [119]. - For the three months ended March 31, 2025, the company reported a net income of $21.4 million, a significant improvement from a net loss of $70 million in the same period of 2024 [131]. Expenses - Total compensation and benefits expenses rose to $149.2 million for the three months ended March 31, 2025, reflecting a 29% increase compared to $115.4 million in the prior year, primarily due to higher bonus accruals [121]. - Non-compensation expenses increased by 26% to $50.9 million for the three months ended March 31, 2025, up from $40.3 million in 2024, mainly due to higher litigation and travel expenses [122]. Cash Flow and Liquidity - The company had cash balances of $111.2 million as of March 31, 2025, down from $331.6 million at the end of 2024, indicating a significant decrease in liquidity [126]. - Operating activities resulted in a net cash outflow of $176.5 million for Q1 2025, compared to a net cash outflow of $206.3 million in Q1 2024, primarily due to cash operating expense outflows [132][134]. - Investing activities generated a net cash inflow of $73.9 million in Q1 2025, attributed to the maturation of investments in U.S. Treasury securities, compared to $82.7 million in Q1 2024 [133][135]. - Financing activities resulted in a net cash outflow of $120.8 million in Q1 2025, primarily due to withholding tax payments and share repurchases, contrasting with a net cash inflow of $33.8 million in Q1 2024 [133][135]. - As of March 31, 2025, the company had $112.5 million in cash, cash equivalents, and restricted cash, down from $159.6 million at the end of Q1 2024 [131]. - The company believes its current liquidity sources will be sufficient to meet operating needs for the next twelve months, but may seek additional financing if necessary [130]. Tax and Regulatory Matters - The effective tax rate for the three months ended March 31, 2025, was (79.6)%, compared to (37.5)% in the same period of 2024, influenced by the size of permanent differences relative to pre-tax income [124]. - As of March 31, 2025, the company had an amount due of $65.5 million under the tax receivable agreement related to the Business Combination [139]. - The company is actively monitoring its regulatory capital base to ensure compliance with minimum capital requirements across various jurisdictions [138]. Client Metrics - The total number of advisory clients decreased to 74 in Q1 2025 from 76 in Q1 2024, while clients with fees greater than $1.0 million increased from 22 to 39 [120]. Currency and Foreign Transactions - The company reported a net impact of $(1.8) million from non-functional currency related transaction losses for Q1 2025, compared to a gain of $0.5 million in Q1 2024 [145]. - The company held cash balances of $26.9 million in non-U.S. dollar currencies as of March 31, 2025, including pound sterling, euros, and Canadian dollars [145]. Stock Repurchase Program - The board of directors approved a stock repurchase program allowing for the repurchase of up to $200 million of Class A common stock, with $79.4 million remaining as of March 31, 2025 [136].

Financial Data and Key Metrics Changes - The company reported first quarter revenues of $212 million, up more than 100% year over year, marking the highest first quarter revenue in its history [5] - Adjusted compensation margin was 67% of revenues, consistent with full year 2024 accrual expectations [11] - Adjusted non-compensation expense for the quarter was $49 million, which included over $10 million in litigation-related costs, driving year-over-year and quarter-over-quarter increases [11] Business Line Data and Key Metrics Changes - Revenue in the U.S. and Europe doubled, driven by larger fees per transaction due to a focus on client coverage and business selection [5] - The restructuring, liability management, and financing advisory business saw a meaningful uptick in demand starting in April [7] Market Data and Key Metrics Changes - The company noted that while deal announcements have slowed, clients are not terminating processes but rather pausing, indicating a strong client engagement with all-time high stats in new business reviews and requests for meetings [6][7] - The announced impending backlog has declined from record levels, but the pipeline remains strong [7] Company Strategy and Development Direction - The company aims to showcase its strength and lean into growth initiatives, emphasizing a client-centric model that allows for quick resource allocation to meet client needs [9] - The firm is focused on recruiting talent, having added several managing directors in key sectors, indicating a strategy to capitalize on market disruptions [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in long-term prospects despite current market volatility, anticipating that once clarity on policy actions is achieved, transaction activity will accelerate [6][10] - The company views the current environment as an opportunity to solidify client trust and strengthen its brand [10] Other Important Information - The company returned $121 million to equity holders in the first quarter, including over $14 million in open market repurchases [12] - The firm ended the quarter with $111 million in cash and no debt, and declared a quarterly dividend of $0.07 per share [13] Q&A Session Summary Question: Impact of M&A Environment on Business - Management noted that clients are pausing rather than terminating M&A processes, indicating ongoing interest in M&A despite market volatility [17][18] Question: Contribution of Non-M&A Businesses - Management highlighted strong performance in the liability management business, attributing success to both market conditions and gaining market share [21][22] Question: Regional Activity in M&A - Management observed a more unified M&A environment in Europe compared to the U.S., with a greater willingness for regional transactions [33][34] Question: Recruiting Environment - Management indicated that slower announcement activity in M&A could lead to better recruiting opportunities, with a focus on adding talent regardless of market conditions [36][38] Question: Clarity on Compensation Ratio - The 67% compensation ratio reflects the best estimate at the end of the quarter, with potential adjustments as the year progresses [42][43] Question: Non-Compensation Expenses - Litigation-related costs were over $11 million for the quarter, expected to be one-time in nature, with guidance for a single-digit increase in non-compensation expenses for the year remaining unchanged [44][45]

Financial Data and Key Metrics Changes - The company reported first quarter revenues of $212 million, up more than 100% year over year, marking the highest first quarter revenue in its history [4] - Adjusted compensation margin was 67% of revenues, consistent with full year 2024 accrual expectations [10] - Adjusted non-compensation expense for the quarter was $49 million, which included over $10 million in litigation-related costs, driving year-over-year and quarter-over-quarter increases [10] Business Line Data and Key Metrics Changes - The restructuring, liability management, and financing advisory business saw a meaningful uptick in demand starting in April [6] - The company did not break out specific revenue contributions from different business lines but emphasized a strong client-centric model that allows quick mobilization of resources to meet client needs [22] Market Data and Key Metrics Changes - Revenue in the U.S. and Europe doubled, driven by larger fees per transaction due to a focus on client coverage and business selection [4] - The company noted a balanced growth trend across the U.S. and Europe, with Europe showing a greater willingness for regional transactions and a more accommodative regulatory backdrop [33] Company Strategy and Development Direction - The company aims to showcase its strength and lean into growth initiatives during periods of disruption, emphasizing long-term prospects [7] - The firm is focused on recruiting talent, with plans to accelerate hiring irrespective of market conditions, taking advantage of the current environment to attract skilled professionals [38] Management's Comments on Operating Environment and Future Outlook - Management noted that while deal announcements have slowed, clients are pausing rather than terminating processes, indicating ongoing interest in M&A [17] - The company anticipates that once clarity on policy actions improves, transaction activity will accelerate, similar to past recoveries from market dislocations [5] Other Important Information - The company returned $121 million to equity holders in the first quarter, including over $14 million in open market repurchases [12] - The firm ended the quarter with $111 million in cash and no debt, and declared a quarterly dividend of $0.07 per share [12] Q&A Session Summary Question: M&A Environment and Client Plans - Management indicated that clients are pausing rather than terminating M&A processes due to current volatility, suggesting a potential rebound in activity once clarity improves [17] Question: Contribution of Non-M&A Businesses - Management expressed confidence in the liability management business, noting that the current market conditions are conducive to its growth [22] Question: Activity in Europe vs. U.S. - Management observed a more unified market in Europe post-policy actions, with a greater willingness for regional transactions compared to the U.S. [33] Question: Recruiting Environment - Management confirmed that slower announcement activity in M&A leads to better recruiting opportunities, with an ongoing commitment to adding talent [38] Question: Clarity on Compensation Ratio - The 67% compensation ratio reflects the best estimate at the end of the quarter, with potential adjustments as the year progresses [43] Question: Non-Compensation Expenses - Litigation costs were over $11 million for the quarter, considered one-time in nature, with guidance for a single-digit increase in non-compensation expenses for the year remaining unchanged [45]

Financial Overview - Perella Weinberg Partners reported first quarter revenues of $211.8 million, a 107% increase from $102.1 million in the same period last year, driven by larger transactions and related fee events across various sectors and geographies [3][4][23] - The company achieved an adjusted pre-tax income of $21 million and a GAAP pre-tax income of $12 million for the quarter [5][10] - Adjusted earnings per share (EPS) was $0.28, while GAAP diluted EPS was $0.24 [5][10] Expenses - Total compensation and benefits for Q1 2025 were $149.2 million, up from $115.4 million in Q1 2024, with a compensation ratio of 70% compared to 113% in the previous year [4][23] - Non-compensation expenses increased to $50.9 million from $40.3 million year-over-year, primarily due to higher professional fees and travel costs [5][23] Capital Management - The company maintained a strong balance sheet with $111 million in cash and no debt as of March 31, 2025 [9][10] - Perella Weinberg returned $121 million to equity holders through share repurchases and dividends, including a declared quarterly dividend of $0.07 per share [10][11] Talent Investment - The firm added four managing directors and plans to onboard two additional partners and two managing directors in the coming months, indicating a focus on talent acquisition to support growth [5][10]