Core Viewpoint - Raymond James (RJF) reported lower-than-expected second-quarter fiscal 2025 results, leading to a 2.3% decline in shares during after-hours trading. Adjusted earnings per share were $2.42, slightly below the Zacks Consensus Estimate of $2.44, but showed a 5% increase year-over-year [1][2]. Financial Performance - Net income available to common shareholders was $493 million, or $2.36 per share, up from $474 million, or $2.22 per share, in the prior-year quarter [3]. - Quarterly net revenues reached $3.40 billion, a 9% increase year-over-year, but fell short of the Zacks Consensus Estimate of $3.43 billion. The Private Client Group saw a 6% growth in net revenues, Asset Management's revenues rose 15%, and Capital Markets' revenues jumped 23% [4]. - Non-interest expenses increased by 9% year-over-year to $2.73 billion, primarily due to higher compensation, commissions, and investment sub-advisory fees. The company recorded a bank loan provision for credit losses of $16 million, down 24% [5]. Asset Management - As of March 31, 2025, client assets under administration totaled $1.54 trillion, up 6% from the prior-year quarter, while financial assets under management grew 8% to $245 billion [6]. Balance Sheet Strength - Total assets were $83.13 billion, a 1% increase from the prior quarter, and total equity rose 2% to $12.13 billion. Book value per share increased to $59.74 from $52.60 a year ago. The total capital ratio improved to 24.8% from 23.3% year-over-year, and the Tier 1 capital ratio rose to 23.5% from 21.9% [7]. Return on Equity - Return on common equity on an annualized basis was 16.4%, down from 17.5% a year ago [8]. Share Repurchase Activity - In the reported quarter, Raymond James repurchased shares worth $250 million [9]. Strategic Outlook - The company’s global diversification efforts, strategic acquisitions, and relatively high interest rates are expected to support top-line growth, despite concerns over elevated operating expenses and macroeconomic uncertainties related to tariff negotiations [10][11].

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]

Company Overview - Raymond James Financial, Inc. (RJF) shares increased by 9.2% to close at $136.28, following a period of 10.6% loss over the past four weeks, indicating a significant recovery in stock performance [1][2] - The stock's rally was supported by strong trading volume, with more shares exchanged than usual, reflecting heightened investor interest [1] Market Context - The surge in RJF shares was attributed to broader market strength, particularly after President Donald Trump's announcement of a 90-day suspension on tariffs for non-retaliating countries, which alleviated trade tensions and improved market sentiment [2] Earnings Expectations - RJF is projected to report quarterly earnings of $2.48 per share, representing a year-over-year increase of 7.4%, with expected revenues of $3.45 billion, up 10.6% from the previous year [3] - However, the consensus EPS estimate for the quarter has been revised 4% lower in the last 30 days, which may indicate potential challenges in sustaining stock price appreciation [4] Industry Comparison - RJF operates within the Zacks Financial - Investment Bank industry, where another company, Robinhood Markets, Inc. (HOOD), saw a significant increase of 23.5% in its stock price, closing at $42.21, despite a -6% return over the past month [4] - Robinhood's consensus EPS estimate for its upcoming report has changed by -0.6% to $0.35, reflecting a substantial year-over-year increase of 94.4% [5]

Core Insights - Raymond James is enhancing its leadership team to strengthen its platform for financial advisors, appointing Doug Brigman as president of Asset Management Services and Michelle Lynch as senior vice president of Practice Management and Growth Consulting [1][6]. Group 1: Leadership Appointments - Doug Brigman will assume the role of president of Asset Management Services effective October 1, 2025, succeeding Erik Fruland, who is retiring after over 34 years with the firm [2]. - Brigman has been with Raymond James since 2008 and has held various leadership positions, including chief administrative officer and president of Raymond James Insurance Group [3]. - Michelle Lynch will take on the newly created role of senior vice president, Practice Management and Growth Consulting, effective May 5, 2025, focusing on supporting financial advisors throughout their business lifecycle [6]. Group 2: Strategic Focus - The firm aims to provide a premier platform for financial advisors, emphasizing fee-based investment solutions, consultation, and service excellence [2][4]. - Brigman expressed a commitment to enhancing collaboration among internal business units to support the growth of the advisory platform [5]. - Lynch highlighted the importance of helping advisors build and grow their businesses according to their unique needs and those of their clients [7]. Group 3: Company Overview - Raymond James Financial, Inc. is a diversified financial services company with total client assets amounting to $1.58 trillion [10].