Moelis & Company Q3 Earnings Beat on Higher Revenues, Stock Dips

Core Insights - Moelis & Company's (MC) third-quarter 2025 adjusted earnings of 68 cents per share exceeded the Zacks Consensus Estimate of 57 cents, showing a significant improvement from 22 cents in the prior-year quarter [1][9] - The company's total revenues grew 30% year over year to $356.9 million, with adjusted revenues rising 34% to $376 million, surpassing the Zacks Consensus Estimate of $370.5 million [3][9] - Operating expenses increased by 20% year over year to $308.6 million, primarily due to higher compensation and benefits costs, which negatively impacted the bottom line [3][9] - Other income for the quarter was $34 million, a substantial increase from $11.1 million in the prior-year quarter, exceeding projections of $4.1 million [4] - As of September 30, 2025, the company maintained a strong liquidity position with cash and liquid investments totaling $619.9 million, with no debt or goodwill [4] Company Outlook - The company's global expansion initiatives, higher average fees, solid capital markets, and diverse operations across sectors are expected to support future growth [5] - However, a hiring spree and rising revenue-related compensation may pose challenges to bottom-line growth [5] - Moelis & Company currently holds a Zacks Rank 2 (Buy) [5] Peer Performance - Morgan Stanley's third-quarter 2025 earnings of $2.80 per share significantly surpassed the Zacks Consensus Estimate of $2.08, with a 49% increase from the prior-year quarter [6] - Goldman Sachs reported adjusted earnings per share of $12.25, exceeding the Zacks Consensus Estimate of $11.11, and showing growth from $8.40 in the previous year [8]