[Part I: Financial Information](index=3&type=section&id=PART%20I%20FINANCIAL%20INFORMATION) This section presents the unaudited financial statements and management's analysis of financial condition and operations [Item 1. Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) This section presents the unaudited condensed consolidated financial statements for the quarter ended March 31, 2025, with detailed notes [Condensed Consolidated Statements of Financial Condition](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Financial%20Condition) Total assets increased slightly to $83.13 billion, driven by bank loans, while liabilities decreased and equity grew to $12.23 billion Condensed Consolidated Statements of Financial Condition (in millions) | Account | March 31, 2025 | September 30, 2024 | | :--- | :--- | :--- | | **Total assets** | **$83,132** | **$82,992** | | Cash and cash equivalents | $9,662 | $10,998 | | Bank loans, net | $48,273 | $45,994 | | **Total liabilities** | **$70,905** | **$71,325** | | Bank deposits | $56,403 | $56,010 | | Accrued compensation, commissions and benefits | $1,914 | $2,325 | | **Total shareholders' equity** | **$12,227** | **$11,667** | [Condensed Consolidated Statements of Income and Comprehensive Income](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20and%20Comprehensive%20Income) Net revenues for Q2 2025 increased 9% to $3.40 billion, with net income rising 4% to $495 million, and diluted EPS at $2.36 Key Performance Indicators (in millions, except per share amounts) | Metric | Q2 2025 | Q2 2024 | YoY Change | Six Months 2025 | Six Months 2024 | YoY Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Net revenues | $3,403 | $3,118 | +9% | $6,940 | $6,131 | +13% | | Pre-tax income | $671 | $609 | +10% | $1,420 | $1,239 | +15% | | Net income | $495 | $476 | +4% | $1,095 | $974 | +12% | | Diluted EPS | $2.36 | $2.22 | +6% | $5.22 | $4.54 | +15% | [Condensed Consolidated Statements of Cash Flows](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Operating activities provided $947 million in cash, while investing activities used $1.60 billion, and financing activities used $463 million Net Cash Flow for Six Months Ended March 31 (in millions) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $947 | $934 | | Net cash used in investing activities | $(1,596) | $(109) | | Net cash provided by/(used in) financing activities | $(463) | $266 | [Notes to Condensed Consolidated Financial Statements (Unaudited)](index=8&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) Detailed notes cover fair value measurements, bank loan portfolio, deposits, and regulatory capital, providing context to financial statements - As of March 31, 2025, **11% of assets and 2% of liabilities were measured at fair value** on a recurring basis. Level 3 assets represented less than 1% of assets measured at fair value[37](index=37&type=chunk) - The bank loan portfolio grew to **$48.5 billion** (held for investment) as of March 31, 2025, up from $46.3 billion at September 30, 2024. The Allowance for Credit Losses (ACL) as a percentage of total loans held for investment decreased to **0.93%** from 0.99%[80](index=80&type=chunk) - Total bank deposits increased to **$56.4 billion** as of March 31, 2025, with **86% of these deposits being FDIC-insured**[126](index=126&type=chunk)[128](index=128&type=chunk) - The company and its bank subsidiaries were categorized as 'well-capitalized' as of March 31, 2025, with RJF's CET1 ratio at **23.3%** against a 7.0% requirement[188](index=188&type=chunk)[190](index=190&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=51&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses Q2 and H1 2025 financial results, highlighting revenue growth, segment performance, liquidity, capital, and risk management practices [Executive Overview](index=53&type=section&id=Executive%20overview) Q2 2025 net revenues grew 9% to $3.40 billion, driven by asset management and investment banking, while maintaining a strong capital position Q2 2025 Financial Highlights vs. Q2 2024 (in millions, except per share) | Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Net revenues | $3,403 | $3,118 | 9% | | Pre-tax income | $671 | $609 | 10% | | Net income available to common shareholders | $493 | $474 | 4% | | Earnings per common share – diluted | $2.36 | $2.22 | 6% | - Key revenue drivers for the quarter included higher asset management fees due to increased PCG client assets, stronger brokerage revenues from fixed income, and improved investment banking activity[219](index=219&type=chunk) - The firm repurchased **1.7 million shares for $250 million** in Q2 2025 and maintained a strong capital position with a Tier 1 leverage ratio of **13.3%** and **$2.5 billion in corporate cash**[223](index=223&type=chunk) [Results of Operations by Segment](index=67&type=section&id=Results%20of%20operations) Segment performance highlights include PCG revenue growth, increased Capital Markets activity, and significant pre-tax income growth in Asset Management and Bank segments Segment Pre-Tax Income for Q2 (in millions) | Segment | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Private Client Group | $431 | $444 | (3)% | | Capital Markets | $36 | $(17) | NM | | Asset Management | $121 | $100 | +21% | | Bank | $117 | $75 | +56% | - PCG client assets under administration (AUA) reached **$1.48 trillion**, with assets in fee-based accounts at **$872.8 billion** as of March 31, 2025[259](index=259&type=chunk) - Capital Markets investment banking revenues increased **21% YoY to $207 million** in Q2 2025, driven by more favorable market conditions[284](index=284&type=chunk)[285](index=285&type=chunk) - Asset Management's total financial assets under management (AUM) grew to **$245.0 billion** as of March 31, 2025, up from $226.8 billion a year prior[298](index=298&type=chunk) [Liquidity and Capital Resources](index=79&type=section&id=Liquidity%20and%20capital%20resources) The firm maintains a strong liquidity and capital position with $83.1 billion in assets, $12.2 billion in equity, and robust capital ratios RJF Regulatory Capital Ratios (March 31, 2025) | Ratio | Actual | Required | | :--- | :--- | :--- | | Tier 1 leverage | 13.3% | 4.0% | | CET1 | 23.3% | 7.0% | | Tier 1 capital | 23.5% | 8.5% | | Total capital | 24.8% | 10.5% | - As of March 31, 2025, the company had **$2.49 billion in corporate cash**, including cash held at the parent and loaned to its subsidiary RJ&A[345](index=345&type=chunk) - The company has significant available credit, with **$9.49 billion from the FHLB** and **$3.4 billion from the FRB discount window** as of March 31, 2025[359](index=359&type=chunk)[360](index=360&type=chunk) - In December 2024, the Board authorized a new **$1.5 billion share repurchase program**. As of March 31, 2025, **$1.2 billion remained available** under this authorization[167](index=167&type=chunk)[223](index=223&type=chunk) [Risk Management](index=88&type=section&id=Risk%20management) The firm employs an ERM program to manage market, credit, liquidity, and operational risks, with focus on CRE loans Daily Value-at-Risk (VaR) for Trading Portfolios (Six months ended March 31, 2025) | $ in millions | High | Low | Period-end (Mar 31, 2025) | Average | | :--- | :--- | :--- | :--- | :--- | | Daily VaR | $4 | $1 | $3 | $3 | Bank Operations Net Interest Income Sensitivity (as of March 31, 2025) | Instantaneous Rate Change (bps) | Projected Change in NII | | :--- | :--- | | +200 | +3% | | +100 | +2% | | -100 | (4)% | | -200 | (9)% | - Nonperforming loans were **$214 million**, or **0.44% of total loans** held for sale and investment, as of March 31, 2025[428](index=428&type=chunk) - The firm is closely monitoring risks in its CRE loan portfolio, especially office real estate, due to remote work policies and high interest rates. The office real estate concentration is **7% of the total corporate bank loan portfolio**[443](index=443&type=chunk)[445](index=445&type=chunk) [Item 3. Quantitative and Qualitative Disclosures about Market Risk](index=97&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risk) Quantitative and qualitative disclosures about market risk are referenced to the 'Risk Management' section of the MD&A - Disclosures about market risk are provided in the MD&A section of this report[452](index=452&type=chunk) [Item 4. Controls and Procedures](index=97&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective, 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 the end of the period[455](index=455&type=chunk) - No changes occurred during the quarter ended March 31, 2025, that have materially affected, or are reasonably likely to materially affect, the company's internal control over financial reporting[456](index=456&type=chunk) [Part II: Other Information](index=100&type=section&id=PART%20II%20OTHER%20INFORMATION) This section provides additional information including legal proceedings, equity sales, and other disclosures [Item 1. Legal Proceedings](index=100&type=section&id=Item%201.%20Legal%20Proceedings) The company reported no new material legal proceedings for the period - The report states 'None' for this item, indicating no new material legal proceedings to disclose[459](index=459&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=100&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales but detailed common stock repurchases, including a new $1.5 billion authorization Share Repurchases for the Quarter Ended March 31, 2025 | Month | Total Shares Purchased | Average Price Per Share | Shares Purchased Under Program | Remaining Authorization (End of Month) | | :--- | :--- | :--- | :--- | :--- | | January 2025 | 23,435 | $162.69 | — | $1,450M | | February 2025 | 315,686 | $158.54 | 315,391 | $1,400M | | March 2025 | 1,402,024 | $142.78 | 1,399,870 | $1,200M | | **Q2 Total** | **1,741,145** | **$145.91** | **1,715,261** | **$1,200M** | [Item 5. Other Information](index=101&type=section&id=Item%205.%20Other%20Information) The company reported that none of its directors or officers adopted or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement during the three months ended March 31, 2025 - No directors or officers adopted or terminated a Rule 10b5-1 trading arrangement during the quarter[467](index=467&type=chunk)

Group 1 - Albert Anthony is a Croatian-American media personality and analyst for financial media platforms, focusing on dividend stocks and general market commentary [1] - The author has covered over 200 companies across multiple sectors and has gained over 1,000 followers since 2023 [1] - Albert Anthony has experience as an analyst in the IT sector and has worked for a top 10 financial firm in the US [1] Group 2 - The author plans to launch a new book in 2025 on Amazon discussing his methodology for stock rating [1] - Albert Anthony & Co. is a sole proprietorship registered in Austin, Texas [1] - The author does not provide personalized financial advice and does not hold material positions in any rated stocks at the time of rating [1]

Shares of Raymond James (RJF) lost 2.3% in after-hours trading in response to lower-than-expected second- quarter fiscal 2025 results (ended March 31). Adjusted earnings of $2.42 per share lagged the Zacks Consensus Estimate of $2.44. The bottom line, however, grew 5% from the prior-year quarter. Net income available to common shareholders (GAAP basis) was $493 million or $2.36 per share, up from $474 million or $2.22 per share in the prior-year quarter. On the other hand, decent brokerage performance in th ...

Financial Performance Highlights - Net revenues reached $3403 million, a 9% increase compared to 2Q24 [9] - Pre-tax income was $671 million, up 10% from 2Q24 [9] - Adjusted pre-tax income was $690 million, a 9% increase compared to 2Q24 [9] - Diluted EPS was $236, a 6% increase compared to 2Q24 [9] - Adjusted diluted EPS was $242, a 5% increase compared to 2Q24 [9] Key Performance Metrics - Client assets under administration totaled $154 trillion [7] - PCG assets in fee-based accounts amounted to $873 billion [7] - Clients' domestic cash sweep and ESP balances were $578 billion [7] - The Tier 1 leverage ratio was 133% [7] - RJF corporate cash was $25 billion [7] Segment Results - Private Client Group net revenues were $2486 million, a 6% increase compared to 2Q24 [11] - Capital Markets net revenues were $396 million, a 23% increase compared to 2Q24 [11] - Asset Management net revenues were $289 million, a 15% increase compared to 2Q24 [11] - Bank net revenues were $434 million, a 2% increase compared to 2Q24 [11]

Core Insights - Raymond James Financial, Inc. reported $3.4 billion in revenue for the quarter ended March 2025, marking a year-over-year increase of 9.1% and an EPS of $2.42 compared to $2.31 a year ago, although it fell short of the Zacks Consensus Estimate of $3.43 billion by -0.72% [1] Financial Performance Metrics - Private Client Group Asset Under Management was $1.48 billion, slightly below the three-analyst average estimate of $1.49 billion [4] - Tier 1 Leverage Ratio stood at 13.3%, exceeding the three-analyst average estimate of 13.1% [4] - Private Client Group assets in Fee-based Accounts totaled $872.80 million, below the average estimate of $880.13 million [4] - Total Capital Ratio was 24.8%, surpassing the two-analyst average estimate of 24.5% [4] - Investment banking revenues were reported at $216 million, a year-over-year increase of 20.7%, but below the average estimate of $255.78 million [4] - Asset management and related administrative fees generated $1.73 billion, reflecting a year-over-year change of 13.8% and exceeding the average estimate of $1.71 billion [4] - Total brokerage revenues reached $580 million, a year-over-year increase of 9.9%, surpassing the average estimate of $562.59 million [4] - Account and service fees were $321 million, down 4.2% year-over-year and below the average estimate of $338.37 million [4] - Interest income was reported at $963 million, a decrease of 8.2% year-over-year, falling short of the average estimate of $993.09 million [4] - Other total revenues were $40 million, showing a year-over-year increase of 29%, slightly below the average estimate of $40.96 million [4] - Principal transactions generated $149 million, a year-over-year increase of 30.7%, exceeding the three-analyst average estimate of $130.55 million [4] - Net interest income was $419 million, a year-over-year increase of 1.5%, but below the average estimate of $513.85 million [4] Stock Performance - Shares of Raymond James Financial have returned -7.5% over the past month, compared to the Zacks S&P 500 composite's -6.6% change, with a Zacks Rank 4 (Sell) indicating potential underperformance in the near term [3]

Over the last four quarters, the company has surpassed consensus EPS estimates three times. Raymond James Financial, which belongs to the Zacks Financial - Investment Bank industry, posted revenues of $3.4 billion for the quarter ended March 2025, missing the Zacks Consensus Estimate by 0.72%. This compares to year-ago revenues of $3.12 billion. The company has topped consensus revenue estimates three times over the last four quarters. The sustainability of the stock's immediate price movement based on the ...

[Fiscal Second Quarter of 2025 Results](index=1&type=section&id=Fiscal%20Second%20Quarter%20of%202025%20Results) [Overall Financial Highlights](index=1&type=section&id=Overall%20Financial%20Highlights) Raymond James Financial reported strong Q2 and record H1 fiscal 2025 results, driven by diverse revenue growth and robust capital Q2 2025 Key Financial Metrics | Metric | Q2 2025 | Change vs. Q2 2024 | Change vs. Q1 2025 | | :--- | :--- | :--- | :--- | | Net Revenues | $3.40 billion | +9% | -4% | | Net Income (to common shareholders) | $493 million | +4% | -18% | | Diluted EPS | $2.36 | +6% | -17% | | Adjusted Net Income (to common shareholders) | $507 million | +3% | -17% | | Adjusted Diluted EPS | $2.42 | +5% | -17% | First Half Fiscal 2025 Key Financial Metrics | Metric | H1 2025 | Change vs. H1 2024 | | :--- | :--- | :--- | | Net Revenues | $6.94 billion (**Record**) | +13% | | Pre-tax Income | $1.42 billion (**Record**) | +15% | | Diluted EPS | $5.22 | +15% | | Adjusted Diluted EPS | $5.36 | +14% | - Client assets under administration reached **$1.54 trillion**, and Private Client Group assets in fee-based accounts were **$872.8 billion**, up **6%** and **9%** respectively over March 2024[4](index=4&type=chunk) - The firm repurchased **$250 million** of common stock in Q2 2025 and an additional **$190 million** in April 2025 Approximately **$1.01 billion** remains available under the repurchase authorization as of April 21, 2025[4](index=4&type=chunk)[19](index=19&type=chunk) - CEO Paul Shoukry highlighted strong financial advisor recruiting, a **robust investment banking pipeline** despite macroeconomic uncertainty, and a **strong balance sheet** with capital and cash **well above targets**[3](index=3&type=chunk) [Segment Results](index=2&type=section&id=Segment%20Results) [Private Client Group (PCG)](index=2&type=section&id=Private%20Client%20Group) The Private Client Group saw **6%** YoY revenue growth from asset management fees and continued asset expansion, despite a sequential revenue dip PCG Q2 2025 Performance | Metric | Q2 2025 | Change vs. Q2 2024 | Change vs. Q1 2025 | | :--- | :--- | :--- | :--- | | Net Revenues | $2.49 billion | +6% | -2% | | Pre-tax Income | $431 million | -3% | -7% | | Assets Under Administration | $1.48 trillion | +6% | -1% | | Assets in Fee-Based Accounts | $872.8 billion | +9% | ~0% | | Domestic Net New Assets | $8.8 billion | - | - | - Domestic Private Client Group net new assets for the quarter represented an annualized growth rate of **2.6%** from beginning of period assets[12](index=12&type=chunk) [Capital Markets](index=2&type=section&id=Capital%20Markets) Capital Markets saw **23%** YoY revenue growth from investment banking and fixed income, despite a sequential decline due to market volatility Capital Markets Q2 2025 Performance | Metric | Q2 2025 (millions) | Change vs. Q2 2024 | Change vs. Q1 2025 | | :--- | :--- | :--- | :--- | | Net Revenues | $396 | +23% | -18% | | Investment Banking Revenues | $207 | +21% | -35% | | Pre-tax Income | $36 | N/A (vs. loss) | -51% | - The sequential decrease in revenues was primarily due to **unfavorable market conditions** leading to decreased investment banking activity, though the pipeline remains **robust**[9](index=9&type=chunk) [Asset Management](index=2&type=section&id=Asset%20Management) Asset Management achieved strong **15%** YoY revenue and **21%** pre-tax income growth, driven by increased assets under management and net inflows Asset Management Q2 2025 Performance | Metric | Q2 2025 (millions) | Change vs. Q2 2024 | Change vs. Q1 2025 | | :--- | :--- | :--- | :--- | | Net Revenues | $289 | +15% | -2% | | Pre-tax Income | $121 | +21% | -3% | | Financial Assets Under Management | $245.0 billion | +8% | ~0% | [Bank](index=4&type=section&id=Bank) The Bank segment achieved **2%** sequential revenue growth, record net loans, and an expanded NIM, while maintaining **strong credit quality** Bank Q2 2025 Performance | Metric | Q2 2025 | Change vs. Q2 2024 | Change vs. Q1 2025 | | :--- | :--- | :--- | :--- | | Net Revenues | $434 million | +2% | +2% | | Pre-tax Income | $117 million | +56% | -1% | | Net Loans | $48.3 billion (**Record**) | +9% | +2% | | Net Interest Margin (NIM) | 2.67% | +1 bps | +7 bps | - The loan portfolio continues to maintain **strong credit quality** and **healthy reserves**[17](index=17&type=chunk) [Consolidated Financial Statements and Key Metrics](index=5&type=section&id=Consolidated%20Financial%20Statements%20and%20Key%20Metrics) [Consolidated Statements of Income](index=6&type=section&id=Consolidated%20Statements%20of%20Income) Q2 2025 total revenues increased **6%** YoY and net revenues rose **9%** YoY, driven by asset management and brokerage fees, with a **higher effective tax rate** Q2 2025 Revenue Breakdown (vs. Q2 2024) | Revenue Source | Q2 2025 (millions) | YoY Change | | :--- | :--- | :--- | | Asset management & related admin fees | $1,725 | +14% | | Total brokerage revenues | $580 | +10% | | Investment banking | $216 | +21% | | Net interest income (Net Revenues - Non-interest Revenues) | $882 | +1% | - Interest expense decreased by **15%** YoY to **$442 million**, contributing to the **9%** growth in net revenues despite an **8%** decline in interest income[26](index=26&type=chunk) - The provision for income taxes increased by **32%** YoY to **$176 million**, reflecting a **higher effective tax rate** of **26.2%** for the quarter[18](index=18&type=chunk)[26](index=26&type=chunk) [Consolidated Selected Key Metrics](index=8&type=section&id=Consolidated%20Selected%20Key%20Metrics) As of March 31, 2025, the company maintained a **robust financial position** with increased assets, common equity, and **strong capital ratios** Key Balance Sheet & Capital Metrics (as of March 31, 2025) | Metric | Value (billions) | YoY Change | | :--- | :--- | :--- | | Total Assets | $83.1 | +2% | | Total Common Equity | $12.1 | +11% | | Book Value per Share | $59.74 | +14% | | Tangible Book Value per Share | $51.29 | +16% | | Tier 1 Leverage Ratio | 13.3% | - | Client Asset & Cash Metrics (as of March 31, 2025) | Metric | Value (billions) | YoY Change | QoQ Change | | :--- | :--- | :--- | :--- | | Client Assets Under Administration | $1,535.9 | +6% | -1% | | Total Clients' Domestic Cash & ESP Balances | $57.8 | -1% | -3% | [Consolidated Net Interest Analysis](index=9&type=section&id=Consolidated%20Net%20Interest%20Analysis) Q2 2025 firmwide net interest income was **$521 million** with a **2.77%** NIM, showing a YoY decline but sequential improvement in the Bank segment Net Interest Margin (NIM) | Period | Firmwide NIM | Bank Segment NIM | | :--- | :--- | :--- | | Q2 2025 | 2.77% | 2.67% | | Q2 2024 | 2.91% | 2.66% | | Q1 2025 | 2.74% | 2.60% | - Total interest-earning assets averaged **$76.2 billion** for the quarter, yielding **5.08%**, down from **5.71%** in the prior-year quarter[34](index=34&type=chunk) - Total interest-bearing liabilities averaged **$65.6 billion** for the quarter, with an average rate of **2.74%**, down from **3.26%** in the prior-year quarter[34](index=34&type=chunk) [Non-GAAP Financial Measures](index=19&type=section&id=Non-GAAP%20Financial%20Measures) [Reconciliation of Non-GAAP Measures](index=19&type=section&id=Reconciliation%20of%20Non-GAAP%20Measures) Non-GAAP measures provide a clearer view of core operating results, with Q2 2025 adjusted net income of **$507 million** and **19.7%** adjusted return on tangible common equity - Non-GAAP measures are used to exclude material items not indicative of core operating results, primarily expenses related to acquisitions and amortization of identifiable intangible assets[60](index=60&type=chunk) Q2 2025 GAAP to Non-GAAP Reconciliation Summary | Metric | GAAP (millions) | Adjustments (millions) | Non-GAAP (Adjusted) (millions) | | :--- | :--- | :--- | :--- | | Pre-tax Income | $671 | +$19 | $690 | | Net Income (to common shareholders) | $493 | +$14 | $507 | | Diluted EPS | $2.36 | +$0.06 | $2.42 | Q2 2025 Adjusted Returns | Metric | Value | | :--- | :--- | | Adjusted Return on Common Equity | 16.9% | | Adjusted Return on Tangible Common Equity | 19.7% |

Core Insights - Raymond James Financial, Inc. reported record net revenues of $3.40 billion and net income of $493 million for the fiscal second quarter ended March 31, 2025, with adjusted net income of $507 million [1][5] - The company achieved record net revenues of $6.94 billion and pre-tax income of $1.42 billion for the first half of fiscal 2025, reflecting a 13% and 15% increase over the same period in fiscal 2024 [2][3] Financial Performance - Quarterly net revenues increased by 9% compared to the prior year's fiscal second quarter, while pre-tax income rose by 10%, driven by higher asset management fees, brokerage revenues, and investment banking revenues [2][5] - Sequentially, quarterly net revenues and pre-tax income decreased by 4% and 10%, respectively, primarily due to lower investment banking revenues [2][5] - For the first six months of fiscal 2025, earnings per diluted share reached $5.22, a 15% increase year-over-year, with adjusted earnings per diluted share at $5.36, up 14% [3] Segment Results - The Private Client Group and Asset Management segments generated record net revenues and pre-tax income during the first half of fiscal 2025 [3] - Capital Markets segment saw a 23% year-over-year increase in quarterly net revenues, mainly from higher investment banking and fixed income brokerage revenues, although there was an 18% sequential decrease due to lower investment banking activity [8][15] Client Assets and Capital Management - Client assets under administration totaled $1.54 trillion, with Private Client Group assets in fee-based accounts at $872.8 billion, reflecting a 6% and 9% increase, respectively, over March 2024 [5][6] - The company repurchased $250 million of common stock during the fiscal second quarter and an additional $190 million in April 2025, with approximately $1.01 billion remaining under the repurchase authorization [17] Tax and Regulatory Compliance - The effective tax rate for the quarter was 26.2%, influenced by nondeductible losses on the company-owned life insurance portfolio [13] - The total capital ratio stood at 24.8% and the tier 1 leverage ratio at 13.3%, both well above regulatory requirements [17]

Core Viewpoint - Raymond James (RJF) is expected to report a year-over-year increase in earnings and revenues for the second quarter of fiscal 2025, with earnings estimated at $2.44 per share, reflecting a 5.6% growth from the previous year, and revenues projected at $3.43 billion, indicating a 9.9% increase [1][3]. Financial Performance - In the last quarter, RJF's earnings surpassed the Zacks Consensus Estimate, driven by strong performance in investment banking and brokerage within the Capital Markets segment, alongside solid results from the Private Client Group and Asset Management segments [2]. - The consensus estimate for investment banking fees is $255.8 million, representing a 42.9% year-over-year increase, while RJF's own estimate is $253.1 million [7]. - Trading revenues are anticipated to show solid growth due to robust client activity and market volatility during the quarter [8]. Interest Income and Expenses - The Federal Reserve maintained interest rates at 4.25%-4.5%, which is expected to have a favorable impact on RJF's net interest income (NII), although higher funding costs may offset some benefits [9]. - The consensus estimate for interest income is $993.1 million, indicating a decline of 5.3%, while RJF's estimate is $1.01 billion [10]. - Total non-interest expenses are projected to reach $2.75 billion, reflecting a 9.6% year-over-year increase due to competitive pressures and inflation [12]. Management Outlook - Management expects asset management and related administrative fees to decline nearly 2% from the prior quarter [13]. - The company has a history of earnings surprises, having outperformed the Zacks Consensus Estimate three times in the last four quarters, with an average beat of 7.75% [3]. Market Conditions - The global mergers and acquisitions landscape showed marginal improvement, primarily driven by the Asia Pacific region, although overall deal value and volume were less impressive than anticipated [4]. - The IPO market is exhibiting cautious optimism amid market volatility and rising flotation costs, while bond issuance volume remains strong due to solid investor demand [6].

Core Insights - Raymond James has launched its proprietary AI Search technology, which utilizes generative artificial intelligence to enhance service excellence for financial advisors and associates [1] - The firm is committed to investing in innovation that improves service levels and saves time for advisors by providing a streamlined question and answer experience [2] - The strategic framework for AI innovation at Raymond James is built on three pillars: data-driven insights, enhanced service models, and secure applications [3] Technology and Investment - AI Search is designed to reduce the time advisors spend searching for information by integrating into existing knowledge centers, thus avoiding the need for new system adoption [2] - The firm invests $975 million annually in technology improvements to support the advisor-client relationship [5] - AI Search includes a real-time voting system to gather feedback on the quality of its results, ensuring reliability [3] Development and Implementation - The development of AI Search includes human checkpoints to minimize errors and maintain transparency and flexibility [4] - The technology is developed in close collaboration with financial advisors to ensure it meets their needs [5] Company Overview - Raymond James Financial, Inc. is a diversified financial services company with total client assets of $1.58 trillion [6]