Oppenheimer's Capital Markets Swing to a Pre-Tax Loss

The Tip Desk · November 10, 2026 · 3 min read

Third-quarter revenue was $382.0 million as investment banking and retail commissions fell and a $21.0 million stock-linked advisor charge lifted compensation.

Oppenheimer Holdings Inc. (OPY) reported third-quarter 2026 revenue of $382.0 million, a 10.0% decline from $424.4 million a year earlier, reversing the 21.9% year-over-year increase recorded in the second quarter.

Net income attributable to the firm was $5.5 million, or $0.52 a share, compared with $21.7 million, or $2.06 a share, in the third quarter of 2025. Results were affected by a $21.0 million pre-tax expense tied to a long-term incentive program for financial advisors that is linked to the OPY stock price, up from $13.5 million a year earlier as Class A shares rose $12.42 in the quarter. Adjusted net income, which excludes that item, was $20.9 million, or $1.96 a share, versus $31.7 million, or $3.01 a share, a year earlier.

President and Chief Executive Robert S. Lowenthal said operating results reflected generally constructive market conditions, but that earnings were disappointing because of lower retail trading, reduced investment banking volumes and higher expense from stock appreciation rights as the share price rose. He said trading activity had moderated from elevated levels a year earlier and that IPO activity slowed as issuers faced an uncertain reception.

Capital Markets was the clearest break. Segment revenue was $114.0 million, 29.7% lower than a year earlier, and the unit swung to a $9.9 million pre-tax loss from $12.3 million of pre-tax income. Investment banking revenue fell to $29.8 million from $75.0 million. Equities underwriting fees declined 82.0% to $8.7 million, and advisory fees from investment banking activities decreased 8.4% to $20.0 million. Lowenthal said corporate clients took a more cautious approach to strategic transactions and that capital raising was largely unavailable to smaller issuers during the quarter.

Sales and trading revenue was $83.1 million. Equities sales and trading increased 14.7% to $50.6 million, which the company attributed mostly to higher trading volumes and growth in options-related commission revenue. Fixed income sales and trading decreased 23.8% to $32.5 million, which the company attributed primarily to lower activity and falling inventory valuations as interest rates moved.

Wealth Management revenue was $266.2 million, 2.5% higher than a year earlier, while pre-tax income was $55.6 million, down 11.0%. Advisory fees increased 15.3% to $154.9 million on higher average assets under management. Retail commissions decreased 13.9% to $53.3 million on lower retail trading activity. Bank deposit sweep income fell $2.8 million from a year ago on lower average short-term interest rates. Financial advisor headcount was 926 at quarter-end.

Assets under management reached a record $59.6 billion at September 30, 2026, up $4.5 billion from a year earlier. The company said the increase comprised $6.2 billion of higher asset values on existing holdings, offset by $1.7 billion of net distributions. Assets under administration were $153.7 billion. The AUM level served as the basis for advisory fee billings for October 2026.

Firm compensation expenses were $264.8 million, down 8.8% from a year earlier, and the compensation ratio was 69.3%, relatively unchanged from 68.4%. Non-compensation expenses were $108.5 million. Stockholders’ equity reached a record $991.1 million at September 30, 2026, and regulatory net capital was $477.9 million. The board announced a quarterly dividend of $0.20 a share payable November 27, 2026.