Core Insights - Marsh & McLennan Companies, Inc. (MMC) reported second-quarter 2025 adjusted earnings per share of $2.72, exceeding the Zacks Consensus Estimate by 2.3% and reflecting an 11% year-over-year increase [1][9] - Consolidated revenues reached $6.97 billion, marking a 12% year-over-year improvement and a 4% increase on an underlying basis, also surpassing the consensus mark by 0.8% [1][9] Financial Performance - Total operating expenses rose 12.4% year over year to $5.1 billion, driven by increased compensation and benefits costs [3] - Adjusted operating income improved 14% year over year to $2.06 billion, beating the estimate of $2.05 billion, with an adjusted operating margin of 29.5%, up 50 basis points year over year [4] Segment Performance Risk and Insurance Services - Revenues for this segment were $4.63 billion, a 15% year-over-year increase and 4% on an underlying basis, beating the Zacks Consensus Estimate by 0.4% [4] - Adjusted operating income for Risk and Insurance Services advanced 15.7% year over year to $1.6 billion, exceeding the consensus mark by 2.5% [4] - Marsh's revenues within this segment rose 18% year over year to $3.8 billion, while Guy Carpenter's revenues increased 5% year over year to $677 million [5][6] Consulting - The Consulting unit's revenues grew 7% year over year to $2.37 billion, surpassing the Zacks Consensus Estimate by 1.3% [7] - Adjusted operating income for Consulting climbed 9.4% year over year to $479 million, although it missed the consensus mark by 2.6% [7] - Mercer, a unit within Consulting, reported a 9% year-over-year revenue increase to $1.5 billion, beating the consensus estimate by 2.8% [8] Financial Position - As of June 30, 2025, Marsh & McLennan had cash and cash equivalents of $1.7 billion, down from $2.4 billion at the end of 2024, while total assets increased to $58.6 billion [11] - Long-term debt decreased to $19 billion from $19.4 billion, and total equity rose to $16 billion from $13.5 billion at the end of 2024 [11] Capital Deployment - In the second quarter, Marsh & McLennan repurchased 1.4 million shares for $300 million [13]

Financial Data and Key Metrics Changes - Consolidated revenue increased by 12% to $7 billion, with underlying revenue growth of 4% [16][20] - Adjusted operating income rose by 14% year-over-year, with adjusted EPS growing by 11% to $2.72 [7][21] - Adjusted operating margin improved by 50 basis points to 29.5% [20] Business Line Data and Key Metrics Changes - Risk and Insurance Services (RIS) revenue was $4.6 billion, up 15% year-over-year, with 4% underlying growth [21][16] - Marsh's revenue increased by 18% to $3.8 billion, with 5% underlying growth [22][16] - Guy Carpenter's revenue grew by 7% to $677 million, maintaining 5% underlying growth [23][16] - Consulting segment revenue was $2.4 billion, up 7% or 3% on an underlying basis [24][16] - Mercer's revenue was $1.5 billion, up 9% or 3% on an underlying basis [25][16] - Oliver Wyman's revenue increased by 5% to $873 million, with 3% underlying growth [27][16] Market Data and Key Metrics Changes - Commercial insurance rates decreased by 4% in Q2, following a 3% decline in Q1 [12][16] - Global casualty rates increased by 4%, with US excess casualty up 18% [13][16] - Workers' compensation rates decreased by 4%, while global property rates decreased by 7% year-over-year [14][16] Company Strategy and Development Direction - The company aims for mid-single-digit underlying revenue growth and continued margin expansion [17][32] - Focus on advising clients on strategies to navigate geopolitical instability and supply chain risks [8][18] - Commitment to addressing the challenges posed by the US litigation environment and rising liability insurance costs [10][11] Management's Comments on Operating Environment and Future Outlook - The global economic outlook remains uncertain, with various geopolitical and economic challenges impacting clients [7][8] - Management expressed confidence in the company's resilience and ability to deliver value despite economic uncertainties [18][32] - The company anticipates continued growth in adjusted EPS and margin expansion for the remainder of 2025 [17][32] Other Important Information - The company announced a 10% increase in its quarterly dividend to $0.90 and completed $300 million in share repurchases [16][32] - Total debt at the end of the quarter was $19.7 billion, with a cash position of $1.7 billion [31][32] Q&A Session Questions and Answers Question: Are you seeing upward pressure on pricing in the insurance market? - Management noted that insurance and reinsurance markets continue to soften, particularly in property, but excess casualty rates are under pressure due to the US litigation environment [38][39] Question: Can you provide more detail on the wealth and career components of organic growth? - Management explained that the wealth business is driven by AUM, but the defined benefits pension consulting work is in structural decline, impacting organic revenue growth [43][48] Question: How does the macroeconomic environment affect the RIS segment? - Management agreed that nominal GDP is a significant factor, and noted that project work is being deferred in the US due to economic uncertainty [57][58] Question: What is the outlook for Marsh International growth? - Management expressed confidence in the strong growth in international markets, despite pricing headwinds, and highlighted the company's capabilities in various regions [76][78] Question: How are rising medical costs impacting your business? - Management indicated that rising healthcare costs are a stress point for clients, but the majority of their business operates on a fixed fee basis, limiting direct impacts from medical inflation [96][99] Question: What are the implications of AI technology on your business? - Management is optimistic about the potential of AI to create efficiencies and improve insights, and is actively investing in technology to support these initiatives [100][102]

Core Viewpoint - Marsh & McLennan Companies, Inc. (MMC) is expected to report second-quarter 2025 results on July 17, 2025, with earnings estimated at $2.67 per share and revenues at $6.91 billion, reflecting nearly 11% year-over-year growth in both metrics [1][6]. Financial Performance Estimates - Second-quarter earnings estimates have been revised upward, indicating a 10.8% increase from the previous year, while revenue estimates suggest an 11.1% year-over-year growth [2]. - For the full year 2025, the revenue estimate stands at $26.95 billion, representing a 10.2% year-over-year increase, and the earnings per share estimate is $9.58, indicating an 8.9% growth [3]. Historical Performance - MMC has a strong track record of exceeding earnings estimates, having beaten the consensus in each of the last four quarters with an average surprise of 2.6% [3]. Earnings Prediction Model - The current model does not predict a definitive earnings beat for MMC, as it has an Earnings ESP of -0.86% and a Zacks Rank of 3 (Hold) [4]. Revenue Drivers - The projected revenue growth in Q2 is attributed to strong performances in the Risk and Insurance Services and Consulting segments, with significant contributions from Marsh and Guy Carpenter subdivisions [7]. - The Risk and Insurance Services segment is expected to see a revenue increase of 14.7% year-over-year, while the Consulting segment's revenues are projected to grow by 5.6% [8][9]. Expense Considerations - Total operating expenses are anticipated to rise by 7% year-over-year, primarily due to increased compensation and benefits, which may pressure the net margin [10]. - The adjusted net margin is expected to be 18.6%, down from 19.2% in the previous year [10].

Core Viewpoint - Marsh & McLennan Companies, Inc. (MMC) reported strong first-quarter 2025 results with adjusted earnings per share of $3.06, exceeding estimates, while revenues of $7.1 billion showed a year-over-year increase but slightly missed consensus expectations [1][2]. Financial Performance - Adjusted earnings per share of $3.06 surpassed the Zacks Consensus Estimate by 1.3% and increased by 5% year over year [1] - Consolidated revenues reached $7.1 billion, reflecting a 9% year-over-year growth, although it missed the consensus mark by 0.1% [1] - Total operating expenses rose 11.2% year over year to $5.1 billion, exceeding model estimates due to increased compensation and benefits [3] - Adjusted operating income improved 8% year over year to $2.2 billion but fell short of the estimate of $2.3 billion [4] Segment Performance Risk and Insurance Services - Revenues in this segment were $4.76 billion, up 11% year over year, but missed the Zacks Consensus Estimate of $4.78 billion [5] - Marsh's revenues increased 15% year over year to $3.5 billion, slightly beating estimates [6] - Guy Carpenter's revenues rose 5% year over year to $1.21 billion, missing the consensus mark [7] Consulting - Consulting segment revenues advanced 5% year over year to $2.31 billion, lagging behind the Zacks Consensus Estimate [8] - Mercer, a unit within Consulting, saw revenues grow 5% year over year to $1.5 billion, marginally beating estimates [9] - Oliver Wyman recorded revenues of $818 million, improving 4% year over year but falling short of consensus [10] Financial Update - As of March 31, 2025, cash and cash equivalents were $1.6 billion, down 33.1% from the end of 2024 [11] - Total assets increased by 0.9% to $57 billion, while long-term debt decreased by 2.9% to $18.9 billion [11] - Total equity rose 5.4% to $14.3 billion [11] Capital Deployment - The company repurchased 1.3 million shares for $300 million during the first quarter [13]