Jefferies Extends Investment Banking and Equities Records
Net earnings attributable to common shareholders were $261 million, or $1.08 a share, as Advisory and Equities both set quarterly records.
Jefferies Financial Group (JEF) posted record quarterly net revenues in Investment Banking and Equities in the three months ended August 31, 2026, as Advisory and cash-and-electronic trading carried the firm while Fixed Income and Asset Management cooled.
Net earnings attributable to common shareholders were $261 million, or $1.08 a share, versus $226 million, or $1.02 a share, in the prior quarter. Total net revenues were $2.22 billion. Return on adjusted tangible shareholders’ equity was 13.5%.
The defining turn was in Investment Banking. Net revenues were $1.33 billion, up from $1.21 billion in the prior quarter. Advisory delivered a record $818 million, up from $674 million, reflecting market-share gains across multiple sectors and a strong market opportunity, with sponsor-led M&A particularly in healthcare, industrials and energy. Equity underwriting was $306 million. Debt underwriting was $177 million. Combined Advisory and Underwriting of $1.30 billion was the firm’s best quarterly result, 20% higher than a year earlier.
Capital Markets net revenues were $802 million. Equities set a quarterly record at $626 million, up from $601 million, reflecting higher global trading volumes across cash and electronic trading, equity options and corporate derivatives, and continued growth in prime services. Fixed Income net revenues were $176 million, down from $199 million, reflecting slower market activity. Combined Investment Banking and Capital Markets net revenues were $2.13 billion.
Asset Management net revenues were $86 million, down from $188 million. Asset management fees and investment return revenues were $34 million, reflecting weaker performance across several fund strategies, including Point Bonita. Other investments, inclusive of net interest, were $73 million. The company remains confident in the long-term outlook as it repositions the platform and reduces capital allocated to certain existing funds.
Compensation and benefits were $1.19 billion, a 53.7% ratio. Non-compensation expenses were $678 million, a 30.5% ratio, primarily due to increased brokerage and clearing fees associated with increased equities trading volumes, and increased technology and communication expenses. The effective tax rate was 24.8%.
The board declared a quarterly cash dividend of $0.40 a share. During the quarter, the company repurchased 1.3 million shares for $70 million, or an average of $52.34 a share. The board increased the share buyback authorization back to $250 million. Adjusted tangible book value per fully diluted share was $35.21. Book value per common share was $46.55.
SMBC increased its equity ownership in Jefferies to approximately 20%, becoming the largest shareholder. A planned Japan joint venture with SMBC is expected to begin serving clients in January 2027 and is intended to scale a wholesale equities and equity capital markets business. Chief Executive Richard Handler said the firm is optimistic about Jefferies’ trajectory and its ability to achieve meaningfully higher operating margins and earnings as it completes the sale of Tessellis and continues to wind down remaining legacy merchant banking investments. He also said the firm is very optimistic about the balance of 2026 and momentum heading into 2027, supported by backlog and new business activity.