Jefferies Financial (JEF.N) has exceeded third-quarter profit estimates, propelled by strong performance in its advisory and stock underwriting businesses. The New York-based investment bank, which advises on deals, underwrites stock sales, and operates trading desks and an asset management business, reported profit attributable to shareholders of $260.6 million, or $1.08 per share, for the three months ended August 31. This comfortably surpassed the average analyst estimate of $1 per share, according to LSEG data.
The company’s investment banking revenue saw a significant 17% jump, reaching $1.33 billion, underpinned by record advisory business performance and robust equity underwriting. Revenue from its capital markets segment, encompassing Jefferies’ trading desks, also climbed 11% to $802 million, driven by record equities trading. These results offer an early indication of broader investment banking trends on Wall Street, arriving ahead of major US banks’ earnings reports in coming weeks, and align with a global dealmaking environment that has exceeded $4 trillion this year.
Despite the overall strong showing, Jefferies’ asset management business faced headwinds. Fees and investment return revenue in this division shrank considerably to $34 million, down from $84 million a year earlier. This decline reflects weaker performance across several fund strategies, notably Point Bonita, which held exposure to the bankrupt auto-parts supplier First Brands. Looking forward, CEO Richard Handler and President Brian Friedman expressed optimism for 2026 and momentum into 2027, citing strong backlog and new business activity, while also affirming confidence in the long-term outlook for the asset management platform. However, the firm’s shares were down 1.5% in extended trading, contributing to an approximate 24% decline this year.
