Houlihan Lokey Reverses Sequential Revenue Decline

The Tip Desk · November 2, 2026 · 2 min read

Second-quarter fiscal 2027 revenues were $692 million, and Corporate Finance recovered to $481 million after a first-quarter drop.

Houlihan Lokey, Inc. (HLI), the global investment bank, reported second-quarter fiscal 2027 revenues of $692 million for the three months ended September 30, 2026, reversing a sequential decline after first-quarter revenues fell to $511 million.

Net income attributable to Houlihan Lokey was $109 million, or $1.64 a share, compared with $111 million, or $1.63 a share, a year earlier. Adjusted net income was $124 million, or $1.85 a share.

Chief Executive Officer Scott Adelson said improving market conditions resulted in a stronger second quarter. The firm said it remains cautious about external volatility but expects solid performance across its businesses for the remainder of the year.

Corporate Finance was the inflection. Segment revenues were $481 million, up from $303 million in the quarter ended June 30, 2026, after Corporate Finance had fallen to $303 million from $434 million in the fiscal 2026 fourth quarter.

The company said Corporate Finance revenues increased 10% versus the year-ago quarter because of a higher average transaction fee on closed deals, driven by transaction mix and improved market conditions for M&A and capital markets. Closed transactions were 142, down from 171 a year earlier; the firm said that decline does not represent a trend. Managing directors in Corporate Finance stood at 267.

Financial Restructuring revenues were $118 million, essentially unchanged from $119 million in the prior quarter. Versus a year earlier, the company said the 12% decrease was primarily due to fewer closed transactions from the timing of closings, partially offset by a higher average fee it said does not represent a trend. Closed transactions were 27. Managing directors were 57.

Financial and Valuation Advisory revenues were $93 million, up from $89 million in the prior quarter. The company attributed the 7% year-over-year increase to growth in non-cyclical businesses. Fee events were 1,071. Managing directors were 46.

GAAP compensation expenses were $441 million, and the compensation ratio was 63.7%. Adjusted compensation expenses were $426 million, with an adjusted compensation ratio of 61.5%. The company said the increase in GAAP and adjusted compensation was primarily a result of higher revenues. Non-compensation expenses were $97 million, or 14.0% of revenues; the company said the increase was primarily rent and other operating expenses. Operating income was $154 million. The effective tax rate was 30.6%.

The board declared a regular quarterly cash dividend of $0.70 a share of Class A and Class B common stock, payable December 15, 2026. During the quarter the company repurchased 397 thousand shares. As of September 30, 2026, it had $888 million of cash and cash equivalents and investment securities.