Financial Data and Key Metrics Changes - The company's Q3 revenues were $1.46 billion, representing a 23% year-over-year increase, driven by engineering and real estate services segments [6][9] - Adjusted EBITDA for the quarter was $191 million, a 24% increase from the previous year [6] - Overall internal growth for the quarter was 13% [6] Business Line Data and Key Metrics Changes - Engineering segment revenues increased by 36%, with internal growth of 6% [7] - Real estate services segment revenues rose by 13%, with capital markets up 21% and leasing revenues up 14% [6][7] - Outsourcing revenues increased by 8%, led by valuation and advisory practices [7] Market Data and Key Metrics Changes - Assets under management reached $108 billion, a 10% increase from the previous year [5] - The company raised $1 billion in new capital commitments during the quarter, with total year-to-date fundraising at $4.4 billion [8] Company Strategy and Development Direction - The company is focused on unifying operations under the Harrison Street Asset Management brand, which is expected to strengthen the business and deliver value to shareholders [4][5] - The engineering sector is seen as a significant growth area, with plans to double revenue and profitability in the coming years [25][94] - The company is actively pursuing acquisitions in various segments, particularly in engineering, to capitalize on growth opportunities in fragmented markets [25][94] Management's Comments on Operating Environment and Future Outlook - Management anticipates an increase in business activity as interest rates stabilize and investor confidence builds [4] - The capital markets recovery is described as gradual, with expectations for continued growth in Q4 and beyond [41][46] - Management remains confident in meeting full-year guidance despite slight expected declines in investment management margins due to integration costs [9][40] Other Important Information - The company has $9 billion in dry powder available for deployment, which is expected to drive future growth [5][86] - The integration of IAM under the Harrison Street platform has received positive client feedback, indicating a successful transition [33] Q&A Session Summary Question: Inquiry about engineering margins and service mix - Management noted that engineering margins were slightly impacted by service mix, with a net margin decrease of 20 to 30 basis points [14][15] Question: Discussion on investment management margins and future outlook - Management indicated that integration costs would impact margins for the next two to three quarters, but they are focused on long-term growth [16][18] Question: Organic growth in engineering - Year-to-date organic growth in engineering is around 8%, with expectations to maintain mid-high single-digit growth for the year [22][23] Question: Capital markets activity and pipeline - The capital markets pipeline is solid, with expectations to exceed last year's performance in Q4 [41][42] Question: Construction activity and market conditions - Management indicated that construction activity is currently soft, particularly in condominiums, but there is ongoing activity in data centers and related infrastructure [61] Question: Performance of recent acquisitions - The integration of Triovest and Asterisk is ongoing, with positive early results noted for both acquisitions [96][98]

Core Viewpoint - Realty Income is highlighted as a reliable dividend stock with a yield of 5.5%, which is one percentage point higher than the average for real estate stocks, and it has a consistent history of dividend payments [11]. Company Overview - Realty Income operates a vast portfolio, leasing over 15,600 properties across the U.S., U.K., and Europe to more than 1,600 clients, ensuring a diversified and stable income stream [6]. - The company boasts an occupancy rate of over 98%, with tenants spanning more than 90 industries, which mitigates risks associated with industry-specific downturns [6]. Sector Breakdown - The company's annualized contractual rent is distributed across various sectors, including: - Grocery stores: 10.7% - Convenience stores: 9.8% - Home improvement: 6.4% - Dollar stores: 6.2% - Fast-food restaurants: 4.9% - Drug stores: 4.6% - Automotive service: 4.3% [7]. Investment Characteristics - Realty Income is classified as a Real Estate Investment Trust (REIT), which allows it to avoid federal corporate income tax by distributing at least 90% of its profits to shareholders, resulting in above-average dividends [10]. - The company has issued its 662nd consecutive monthly dividend and has increased its dividend every quarter for over 27 years, showcasing its commitment to consistent returns [11]. Financial Performance - In the second quarter, Realty Income reported revenue of $1.41 billion, an increase from $1.34 billion year-over-year, although net income decreased to $196.9 million from $256.6 million [12]. - The stock has appreciated by 10% year-to-date, outperforming the S&P 500's return of 9%, and is projected to provide a total return of 12.5% in 2025 [12].

Financial Performance - Second Quarter 2025 - Revenues increased by 18% to $1,347.6 million compared to $1,139.4 million in Q2 2024[2,8] - Net Revenues increased by 16% to $1,185.9 million compared to $1,018.0 million in Q2 2024[2,29] - Adjusted EBITDA increased by 16% to $180.2 million compared to $155.6 million in Q2 2024[2,25] - Adjusted EPS increased by 26% to $1.72 compared to $1.36 in Q2 2024[2] - GAAP diluted EPS decreased by 89% to $0.08 compared to $0.73 in Q2 2024[2] Financial Performance - First Half 2025 - Revenues increased by 16% to $2,488.8 million compared to $2,141.3 million in the first half of 2024[2,30] - Net Revenues increased by 14% to $2,179.6 million compared to $1,908.7 million in the first half of 2024[2,30] - Adjusted EPS increased by 22% to $2.59 compared to $2.13 in the first half of 2024[2] Segment Performance - Engineering revenue increased by 67% in USD and 65% in local currency compared to Q2 2024[9,16] - Real Estate Services revenue increased by 4% in both USD and local currency compared to Q2 2024[9,12] - Investment Management revenue remained flat with 0% growth in both USD and local currency compared to Q2 2024[9,19] Capitalization and Liquidity - Net Debt stood at $1,556.9 million as of June 30, 2025[21] - The company has $900 million of available liquidity under revolving credit facility after the closing of RoundShield acquisition in July 2025[22]

Historical Performance & Returns - Realty Income has produced positive total operational return each year since its NYSE listing in 1994[5] - The company's historical average dividend yield is approximately 6%[6] - The historical average AFFO (Adjusted Funds From Operations) per share CAGR (Compound Annual Growth Rate) is about 5%[7] - The historical average total operational return is approximately 11%[8, 11] - From 2015-2024, the average total operational return was approximately 10%[10] Expansion & Diversification - In 2023, Realty Income executed two sale leaseback transactions in the US totaling $206 million[30] - In 2023, Realty Income acquired 25 Asda properties in the UK for £650 million[24] - Realty Income partnered with Asda on a £300 million secured note in 2024 and a £142 million floating rate loan in 2023[26] - The company has a significant $8.5 trillion addressable market in Europe[23] Risk & Volatility - Realty Income has produced approximately 10% average total operational return with only approximately 2% volatility[37]