Core Insights - Piper Sandler reported strong financial performance in 2025, with record adjusted net revenues of $1.9 billion and adjusted EPS of $17.74, reflecting a 22% increase in revenues compared to 2024 [1][24][25] - The company achieved a 39% increase in adjusted net income year-over-year, driven by robust advisory revenues and strong execution across all business lines [1][6][25] Financial Performance - In Q4 2025, adjusted net revenues reached $635 million, with an operating margin of 27.2% and adjusted EPS of $6.88 [1][24] - For the full year, the operating margin was 21.9%, with net income totaling $318 million [24][25] - The compensation ratio improved to 60.1% for 2025, reflecting increased net revenues and operational discipline [25][27] Advisory Business - Advisory revenues grew by 28% in 2025, totaling $1 billion, with significant contributions from financial services and industrial sectors [8][10][25] - The company completed 135 advisory transactions, a 16% increase from the previous year, and was ranked as the number two adviser for U.S. M&A deals under $1 billion [8][9][10] - Non-M&A advisory revenues exceeded 25% of total advisory revenues, driven by debt capital markets advisory and private capital advisory [11][12] Corporate Investment Banking - Corporate Investment Banking revenues reached $1.3 billion, a 28% increase from the prior year, with strong performance in M&A and debt capital markets [8][12] - The firm generated $469 million in revenues during Q4 2025, significantly driven by M&A activity [7][8] Public Finance and Brokerage - The public finance business generated $146 million in revenues for 2025, a 19% increase from the previous year, with strong performance in municipal financing [18][19] - Equity brokerage revenues reached a record $230 million for the full year, supported by strong trading volumes and client engagement [20][21] Capital Allocation - The company returned $239 million to shareholders in 2025 through stock repurchases and dividends, including a special cash dividend of $5 per share [29][30] - A four-for-one stock split was approved to enhance liquidity and accessibility for investors [31] Outlook - The company anticipates continued strong performance in 2026, with a healthy pipeline of advisory engagements and favorable market conditions [12][15][32] - Expectations for public finance and equity brokerage revenues in 2026 are optimistic, with similar performance anticipated compared to 2025 [20][21]

Financial Data and Key Metrics Changes - Piper Sandler reported record-adjusted net revenues of $635 million in Q4 2025, with a 27.2% operating margin and adjusted EPS of $6.88 [4] - For the full year 2025, adjusted net revenues reached $1.9 billion, achieving a 21.9% operating margin and adjusted EPS of $17.74, reflecting a 22% growth in adjusted net revenues compared to 2024 [4][20] - The company returned $239 million to shareholders through share repurchases and dividends in 2025 [5][24] Business Line Data and Key Metrics Changes - Corporate investment banking generated $469 million in revenues in Q4 2025, a significant increase driven by robust M&A activity, with full-year revenues totaling $1.3 billion, up 28% from the prior year [7][11] - Advisory revenues for Q4 were $403 million, up 44% year-over-year, with full-year advisory services generating $1 billion, reflecting a 28% increase from 2024 [7][21] - Equity brokerage revenues reached a record $230 million for the full year 2025, with Q4 revenues of $64 million [16][17] - Fixed income revenues for 2025 totaled $203 million, up 9% from the prior year, driven by strong activity with depository clients [17] Market Data and Key Metrics Changes - The public finance market remained favorable, with Piper Sandler generating $146 million in municipal financing revenues for 2025, a 19% increase over the previous year [15] - The company maintained its position as the number two underwriter based on the number of municipal transactions [15] Company Strategy and Development Direction - Piper Sandler aims to grow annual revenues to over $2 billion in the coming years, supported by ongoing investments in technology and advisory capabilities [14] - The firm is focused on expanding its product and sector teams, enhancing geographic reach, and increasing market share, particularly in private equity [12][10] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the advisory revenue pipeline for 2026, anticipating continued strong performance driven by improving market conditions and client engagement [10][13] - The company noted that while larger advisory transactions closed at the end of 2025, the backlog remains strong, with typical seasonality expected in Q1 2026 [60] Other Important Information - The board approved a 4-for-1 forward stock split to increase liquidity and accessibility for investors, effective March 24, 2026 [25] - The company expects a modest increase in non-compensation expenses in 2026, primarily due to the relocation of its New York office [22] Q&A Session Summary Question: Advisory business performance and sponsor engagement - Management noted a strong 28% growth in advisory revenues, with increased activity from sponsor clients and bank M&A contributing positively [31][32] Question: Capital allocation and M&A opportunities - Management indicated a potential increase in stock buybacks due to improved liquidity and a favorable environment for acquisitions, with optimism about the M&A pipeline [34][36] Question: Expansion into new businesses - Management highlighted a focus on existing products with significant growth potential, particularly in restructuring and private capital advisory [40] Question: Equity capital markets outlook - Management acknowledged the volatility in equity markets but emphasized the importance of diversification across sectors to mitigate risks [42] Question: Sponsor client conversations and market conditions - Management reported steady improvement in sponsor engagement, with a positive outlook for the debt capital advisory business [46][48] Question: Advisory pipeline and market momentum - Management confirmed a healthy backlog for advisory services, with typical seasonality expected in the first half of 2026 [59]

Financial Data and Key Metrics Changes - Piper Sandler reported record-adjusted net revenues of $635 million in Q4 2025, with a 27.2% operating margin and adjusted EPS of $6.88. For the full year, adjusted net revenues reached $1.9 billion, achieving a 21.9% operating margin and adjusted EPS of $17.74, reflecting a 22% growth compared to 2024 [4][19][20] - The company generated a 39% increase in adjusted net income compared to 2024, driven by strong execution and improving market conditions [4][5] Business Line Data and Key Metrics Changes - Corporate investment banking revenues totaled $469 million in Q4 2025, up significantly year-over-year, with full-year revenues of $1.3 billion, representing a 28% increase from the prior year [6][11] - Advisory revenues for Q4 were $403 million, up 44% year-over-year, with full-year advisory services generating $1 billion in revenues, up 28% from 2024 [6][7] - Equity brokerage revenues reached a record $230 million for the full year, with Q4 revenues of $64 million [16][17] - Fixed income revenues for 2025 were $203 million, up 9% from the prior year, driven by robust activity with depository clients [17][18] Market Data and Key Metrics Changes - The company completed 335 advisory transactions in 2025, a 16% increase from the prior year, and was ranked as the number two advisor based on the number of announced U.S. M&A deals under $1 billion [8][9] - The public finance market conditions remained favorable, with municipal financing revenues of $146 million for 2025, reflecting a 19% increase over the previous year [15] Company Strategy and Development Direction - Piper Sandler aims to grow annual revenues to over $2 billion in the coming years, supported by ongoing investments in business diversification and sector capabilities [13] - The company has made substantial investments in non-M&A advisory capabilities, which have increasingly contributed to total advisory revenues [9][10] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the advisory revenue pipeline for 2026, citing a strong engagement mandate and favorable market conditions [10][12] - The company anticipates continued growth in advisory revenues, particularly in the context of improving market conditions and a constructive regulatory environment [12][26] Other Important Information - Piper Sandler returned $239 million to shareholders in 2025 through share repurchases and dividends, with a total dividend payout of $7.70 per share [24][25] - The board approved a 4-for-1 forward stock split to increase liquidity and accessibility for investors [25] Q&A Session Summary Question: Advisory business performance and sponsor engagement - Management noted a strong performance in the advisory business with a 28% revenue growth, highlighting increased activity with sponsor clients and bank M&A [30][32] Question: Capital allocation and M&A opportunities - Management indicated a balanced approach to capital allocation, focusing on dividends, potential stock buybacks, and strategic acquisitions, with optimism about the M&A pipeline [33][35] Question: Expansion into new businesses - Management discussed the focus on enhancing existing products and services rather than pursuing new business lines at this time, emphasizing the growth potential in current offerings [38][39] Question: Equity capital markets outlook - Management acknowledged the volatility in equity markets but emphasized the importance of diversification across sectors to mitigate risks [40] Question: Sponsor client conversations and market conditions - Management characterized ongoing discussions with sponsor clients as steadily improving, with a focus on liquidity and M&A opportunities [44][46] Question: Growth potential in debt capital advisory - Management expressed confidence that the debt capital advisory and private capital advisory businesses could continue to grow alongside the M&A platform [47][48]

Financial Data and Key Metrics Changes - Adjusted net revenues for the second quarter of 2025 were $405 million, with an operating margin of 18.1% and adjusted EPS of $2.95, all higher compared to the same period last year [6][20][21] - Advisory revenues reached $206 million during the quarter, up 12% year over year, driven by a higher average fee and a total of 71 transactions completed [6][7] - For the first half of 2025, net revenues totaled $789 million, with an operating income of $142 million and an operating margin of 18% [20][21] Business Line Data and Key Metrics Changes - Advisory services accounted for 54% of total net revenues, increasing 24% year over year, with strong performance in M&A and non-M&A advisory services [21][22] - Corporate financing revenues were $35 million, down 31% from the previous year, with 26 financings completed, raising $10 billion for corporate clients [10][11] - Municipal financing revenues increased by 66% year over year to $42 million, driven by strong demand and favorable market conditions [14] - Equity brokerage revenues were $58 million, up 12% year over year, with robust trading activity [16] - Fixed income revenues reached $54 million, up 21% from the first quarter and 37% from the previous year, driven by strong activity with depository clients [17] Market Data and Key Metrics Changes - The economic fee pool for companies with sub-five billion dollars of market cap decreased by 19% year over year, with a significant 61% decline in the biopharma sector [11] - The IPO market is showing signs of improvement, particularly in med tech, although biotech IPOs remain slow [43][44] Company Strategy and Development Direction - The company is focused on expanding its M&A business and technology capabilities, as evidenced by the acquisition of G Squared Capital Partners [26][28] - There is a strategic emphasis on managing headcount and driving productivity while enhancing sector and product expertise [12][13] Management's Comments on Operating Environment and Future Outlook - The macro environment has shown improvement, with increased client engagement and a robust pipeline of transactions expected to continue into the third quarter [5][9] - Management expressed optimism about the advisory services outlook, despite some volatility impacting deal processes earlier in the quarter [9][10] Other Important Information - The company repurchased approximately 85,000 shares for $21 million and paid $17 million in dividends during the quarter [24][25] - A $0.05 increase in the quarterly cash dividend to $0.70 per share was announced, effective September 12 [24][25] Q&A Session Summary Question: What does a more normal bank consolidation market mean for revenue? - Management noted that conditions for depository M&A have improved, with quicker regulatory approvals and an increase in transaction announcements expected to impact revenues positively [32][33] Question: How is the Avidity acquisition enhancing client connectivity? - Management reported that the acquisition has met expectations, enhancing relationships with senior partners and improving overall transaction activity [36][38] Question: What is the outlook for the IPO market, particularly in biotech? - Management indicated that while the IPO market is improving, biotech remains slow, with a need for continued improvement before significant activity resumes [43][44] Question: How do the fixed income trading and bank M&A outlooks align? - Management clarified that the strong second quarter in fixed income does not contradict the positive outlook for bank M&A, as both areas are experiencing different dynamics [46][50] Question: What is the current state of conversations with sponsor clients? - Management observed increased activity and a positive outlook for transactions in the second half of the year, although caution remains [55][56] Question: What is the trajectory for compensation and non-compensation expenses? - Management expects the compensation ratio to remain stable, while non-compensation expenses may trend higher due to increased occupancy and legal fees [76][78]

Financial Data and Key Metrics Changes - Adjusted net revenues for Q2 2025 were $405 million, with an operating margin of 18.1% and adjusted EPS of $2.95, all higher compared to the same period last year [5][19] - Advisory revenues reached $206 million during the quarter, up 12% year over year, driven by a higher average fee and an increase in completed transactions [5][6] - For the first half of 2025, net revenues totaled $789 million, with an operating income of $142 million and an operating margin of 18% [19][20] Business Line Data and Key Metrics Changes - Advisory revenues for the first half of 2025 were $423 million, up 24% compared to the previous year, with significant growth in M&A and non-M&A advisory services [6][20] - Corporate financing revenues were $35 million, down 31% year over year, with 26 financings completed, raising $10 billion for corporate clients [9][10] - Public finance revenues increased by 66% year over year to $42 million, driven by strong market conditions and demand [13] - Equity brokerage revenues were $58 million, a 12% increase year over year, with robust trading activity [15] - Fixed income revenues reached $54 million, up 37% from the previous year, driven by strong activity with depository clients [16] Market Data and Key Metrics Changes - The economic fee pool for companies with sub-five billion dollars market cap decreased by 19% year over year, with a notable 61% decline in the biopharma sector [10] - The municipal financing market saw a 15% growth in par value issuance, with Piper Sandler exceeding this growth with a 66% increase in revenues [13] Company Strategy and Development Direction - The company is focused on expanding its M&A business and enhancing its technology investment banking group through strategic acquisitions, such as the planned acquisition of G Squared Capital Partners [25][26] - Investments in non-M&A advisory capabilities are gaining traction, with total revenues from these product lines growing faster than overall advisory revenues [6][7] Management's Comments on Operating Environment and Future Outlook - Management noted a shift in market sentiment and improved client engagement, leading to a robust pipeline of announced and in-process transactions [4][9] - The outlook for advisory services is positive, with expectations for third-quarter advisory revenues to be consistent with the second quarter [9] - Management expressed confidence in the recovery of the IPO market, particularly in sectors like med tech and insurance, while noting challenges in the biotech IPO space [40][42] Other Important Information - The company repurchased approximately 85,000 shares for $21 million and paid $17 million in dividends during the quarter [23][24] - A restructuring charge of $5 million was included in GAAP results due to headcount reductions and vacated office space [18] Q&A Session Summary Question: What does a more normal bank consolidation market mean for revenue? - Management indicated that conditions for depository M&A are improving, with quicker regulatory approvals and an increase in transaction announcements expected to impact revenues positively [30][32] Question: How is the Avidity acquisition enhancing client connectivity? - Management reported that the acquisition has met expectations, enhancing relationships with senior partners and improving overall transaction activity [34][36] Question: What is the outlook for the IPO market, especially in biotech? - Management noted a general improvement in the IPO market but highlighted that biotech IPOs remain slow, requiring continued improvement before significant activity resumes [42][43] Question: How do the fixed income trading and bank M&A outlooks align? - Management clarified that the strong Q2 results in fixed income do not contradict the positive outlook for bank M&A, attributing the fixed income performance to large transactions [44][46] Question: How are conversations with sponsor clients evolving? - Management observed increased activity and a positive outlook for transactions, although caution remains in the process [55][56] Question: What is the confidence level in achieving the $2 billion investment banking target? - Management expressed confidence in achieving the target, citing diverse growth opportunities across various industry teams [57][61]

Financial Data and Key Metrics Changes - Piper Sandler reported adjusted net revenues of $383 million for Q1 2025, reflecting a 15% increase compared to Q1 2024, but a 23% decline from the previous quarter [21] - The operating margin was 17.9%, with adjusted EPS at $4.9, both showing improvements year over year [6][21] - Operating income grew by 23% year over year, indicating enhanced operational efficiency [22] Business Line Data and Key Metrics Changes - Corporate Investment Banking revenues reached $253 million, a 20% increase year over year, driven by advisory services which generated $217 million, up 38% [6][7] - Corporate financing revenues decreased by 32% year over year to $36 million, attributed to a weakened equity underwriting market [12] - Public finance revenues increased by 27% year over year to $26 million, outpacing market issuance growth [16] - Equity brokerage revenues rose by 10% year over year to $54 million, while fixed income revenues increased by 7% to $45 million [18][19] Market Data and Key Metrics Changes - The equity markets experienced heightened volatility, impacting investor sentiment and leading to a more cautious approach [5][12] - The health care fee pool for corporate financing decreased over 60%, reflecting significant market challenges [12] - The municipal financing market showed robust activity, although recent rate volatility has led to transaction postponements [16] Company Strategy and Development Direction - The company aims to leverage its diversified product offerings and sector expertise to navigate market uncertainties and enhance client engagement [5][8] - Piper Sandler is focused on expanding its capabilities in the infrastructure sector and enhancing its advisory services to capitalize on market opportunities [13][14] - The firm continues to rank as a top three investment bank in middle market deal activity, positioning itself for future growth [14] Management's Comments on Operating Environment and Future Outlook - Management noted that while the near-term outlook remains uncertain, there is potential for a rebound in M&A activity once market conditions stabilize [10][11] - The company anticipates a decline in advisory revenues in Q2 due to market volatility but expects certain sectors to remain active [10][60] - Management emphasized the importance of CEO confidence in driving M&A transactions, indicating that strategic clients are still interested in transacting [66] Other Important Information - The company repurchased approximately 266,000 shares for $81 million, maintaining a flat share count since 2021 [24] - A quarterly cash dividend of $0.65 per share was approved, to be paid on June 13 [25] Q&A Session Summary Question: M&A conditions and market stability - Management indicated that M&A activity is sector-dependent, with some processes stalled due to market uncertainty, particularly in consumer sectors [29][30] Question: Outlook for depositories - There is a more positive outlook for depositories, with recent transactions indicating potential for increased activity [34] Question: Advisory business countercyclicality - Management noted that debt capital markets and restructuring segments are growing faster than M&A, providing stability [44][46] Question: IPO pipeline and health care business - The IPO market is showing signs of improvement, but small-cap biotech remains challenged [75] Question: Fixed income trading activity - Volatility is creating uncertainty, leading to cautious behavior among clients, particularly in fixed income markets [77]