1) Strategic Momentum and Leadership
- Moelis & Company closed 2025 with strong momentum, entering 2026 from a position of strength.
- Record fourth quarter revenues of $488 million, with full-year adjusted revenues growing 28% to $1.54 billion.
- Significant growth driven by 35% increase in M&A and a record-setting year for capital markets.
- The firm added 21 managing directors in 2025, promoting an additional 13 to Managing Director, enhancing its talent pool.
- The private capital advisory (PCA) business is gaining traction, with plans for further investment and expansion.

2) Financial Performance and Segment Results
- Fourth quarter revenues increased 11% year-over-year; full-year adjusted revenues rose 28%.
- Revenue mix: approximately 2/3 from M&A and 1/3 from non-M&A activities.
- Adjusted compensation expense ratio improved to 65.8% for the full year, down from 69% in 2024.
- Adjusted pretax margin for Q4 was 28.6%, with a full-year margin of 21.5%, up from 16.4% in 2024.
- Adjusted EPS for 2025 was $2.99, a 64% increase from $1.82 in 2024.

3) Challenges and Headwinds
- Capital structure advisory (CSA) revenues declined, though a long runway of liability management assignments is anticipated due to high leverage across many companies.
- Geopolitical uncertainties may impact transaction activity, but firms are adapting to navigate these challenges.
- The firm is cautious about the potential for economic downturns affecting M&A activity, particularly in the software sector due to AI disruption.

4) Operational and Product Plans
- PCA is expected to ramp significantly in 2026, with the team already integrated with industry and financial sponsor bankers.
- The firm is focused on maintaining a strong balance sheet with $849 million in cash and no debt, while also returning capital to shareholders through dividends and buybacks.
- A new share repurchase program of up to $300 million has been authorized, with $284 million returned to shareholders in 2025.

5) Guidance and Outlook
- The firm is optimistic about continued growth in 2026, with a strong pipeline and elevated levels of client activity.
- Revenue recognition may be back-half weighted in 2026, following seasonal trends.
- The firm expects to maintain a similar compensation ratio to the end of 2025, with potential adjustments based on revenue performance.

Bottom line: Moelis & Company is positioned for sustained growth in 2026, backed by strong financial performance, strategic investments in talent and technology, and a robust pipeline of opportunities, despite facing potential headwinds from economic and geopolitical factors.