Evercore Inc.

Good morning and welcome to Evercore's fourth quarter 2025 and full year earnings conference call. Today's call is scheduled to last about one hour, including remarks by Evercore management and the question and answer session. In order to ask a question, please press the star key followed by the number one on your touchtone phone at any time. I will now turn the call over to Katy Haber, head of investor relations at Evercore. Please go ahead.

Thank you, operator. Good morning and thank you for joining us today for Evercore's fourth quarter and full year 2025 financial results conference call. I'm Katy Haber, Evercore's head of investor relations. Joining me on the call today is John Weinberg, our chairman and CEO, and Tim LaLonde, our CFO. After our prepared remarks, we will open up the call for questions. Earlier today, we issued a press release announcing Evercore's fourth quarter and full year 2025 financial results. Our discussion of our results today is complimentary to the press release which is available on our website at evercore.com. This conference call is being webcast live in the For Investors section of our website and an archive of it will be available for 30 days beginning approximately one hour after the conclusion of this call. During the course of this conference call, we may make a number of forward-looking statements. Any forward-looking statements that we make are subject to various risks and uncertainties and there are important factors that could cause actual outcomes to differ materially from those indicated in these statements. These factors include but are not limited to those discussed in Evercourse filings with the SEC, including our annual report on Form 10-K, quarterly reports on Form 10-Q, and current reports on Form 8-K. I want to remind you that the company assumes no duty to update any forward-looking statements. In our presentation today, unless otherwise indicated, we will be discussing adjusted financial measures, which are non-GAAP measures that we believe are meaningful when evaluating the company's performance. For detailed disclosures on these measures and the GAAP reconciliations, you should refer to the financial data contained within our press release, which is posted on our website. We continue to believe that it is important to evaluate Evercore's performance on an annual basis. As we have noted previously, our results for any particular quarter are influenced by the timing of transaction closings. I will now turn the call over to John.

Thank you, Katy, and good morning, everyone. 2025 was a strong year for Evercore. We saw broad-based momentum across all of our businesses and ended the year with the strongest revenue performance in our history. Firm-wide adjusted net revenue reached approximately $3.9 billion, up 29% versus the prior year and nearly 17% above our previous record in 2021. In fact, our fourth quarter represented the strongest revenue quarter in our history with nearly 1.3 billion in adjusted net revenue. For the year, we generated approximately $14.56 in adjusted earnings per share, continued to return a meaningful amount of capital to shareholders, and improved our margin profile. Our quarterly and full year record results reflect the improving market environment, the benefits of our diversified business model, and the execution of our long-term growth strategy. We're pleased with how we delivered for our clients and our shareholders in 2025 and we enter 2026 with strong momentum and optimism. Before getting into the details, I want to put our results in the context of the market environment. Industry-wide global M&A activity rebounded meaningfully last year. announced transactions totaled approximately $4.5 trillion, up 49% from the prior year and just 19% below record levels of 2021. Importantly, activity accelerated throughout the year. Deal volumes in the second half of 2025 were approximately 45% higher than in the first half, reflecting a clear shift in sentiment and decision-making. That improvement was particularly evident in the large cap segment of the market. Global M&A volumes for transactions greater than $5 billion were the highest ever and approximately 13% above 2021 levels. Taken together, these metrics reflect improving confidence among boards and management teams, constructive financing conditions across public and private markets, and strong equity markets. Now, turning to Evercore, I want to highlight a few of our key accomplishments from the year across our market position, talent investment, and platform expansion. We continue to serve clients on a number of the most complex and notable transactions, acting as financial advisor on five of the 15 largest global M&A deals for the year and ranked third for sell-side transactions in the U.S. based on dollar value. Relative to our largest global competitors, we continue to gain share. For the second year in a row, we ranked as the third largest investment bank globally in 2025 based on advisory fees across all public firms. Nearly all of our businesses posted record results, including our North America and EMEA advisory businesses, private capital advisory, private funds group, our equities business, and wealth management. Importantly, the benefits of our diversification were increasingly evident. For the fourth quarter and full year, approximately 45% of revenues were generated from non-M&A businesses. Turning to talent, 2025 was a year of continued investment as we built out our senior advisory bench globally. We enter 2026 with 171 investment banking senior managing directors, We hired 19 SMDs across sectors, products, and geographies, representing our largest class of new lateral SMDs to date, and added 11 new promotes at the beginning of 2025. We are also excited to announce the recent promotion of eight investment banking SMDs globally, which is in addition to the 171 SMDs, underscoring our continued commitment to developing talent from within. In fact, 40% of our investment banking SMDs have been promoted internally, the highest percentage in our history. Our SMD base is 50% larger than it was at the end of 2021, and more than 40 SMDs are currently in a ramp mode, positioning us well for years ahead. Finally, expanding our platform across regions, sectors, and products was a key area of focus for us in 2025. We completed the acquisition of Robbie Warshaw, a leading UK-based advisory firm. The acquisition represents a significant next step in our EMEA expansion strategy, and the integration is progressing well. We also continue to expand our footprint across key markets in EMEA, including significant investment in France, and first-time offices in Italy, the Nordics and Saudi Arabia. And we remain focused on building those out over time. We further strengthened our sector coverage globally, including healthcare, industrials and transportation, while continuing to deepen our sponsor coverage efforts. We remain focused on broadening our product capabilities, including debt advisory, securitization, private capital advisory, ECM, and Ratings Advisory, to name a few. Before turning to the outlook, I'll briefly highlight a few key trends across our businesses from the quarter and the year. Our M&A Advisory businesses finished the year with strong momentum. In North America, our team achieved a record year, and activity was broad-based across sectors, while financial sponsor engagement continued to increase and broaden. Industry-wide financial sponsor activity for 2025 was up 43% in dollar volume and 14% in number of transactions, excluding deals below $100 million, and we are expecting continued improved activity in 2026. In EMEA, advisory activity accelerated meaningfully in the second half of the year. Our EMEA advisory business delivered record results in the fourth quarter and year with strength across sectors and products. In the fourth quarter, we advised on a number of significant transactions around the globe, including Warner Bros. Discovery on its $83 billion sale of Warner Bros. to Netflix and the related spinoff, which was the largest announced transaction of the year, Exalta's $25 billion merger with Exxon-Nobel, Sidara Therapeutics on its $9.2 billion sale to Merck, and Field Air's $10.3 billion acquisition by CD&R. Our strategic defense and shareholder advisory group continued to be busy into year end as activist campaigns remained at elevated levels. The liability management and restructuring group had a strong close to the year generating its second best year for revenues and notably well above last year's performance. Activity in the quarter and year reflected a more balanced mix of liability management and traditional restructuring activity. The private capital-related businesses remained a source of strength. PCA delivered another record year with strong performance across GP-led continuation funds, LP transactions, and structured capital solutions, and we advised on nearly half of industry ride secondary volumes in 2025. The private funds group also posted a record year, continuing to deepen relationships with our core client base while also expanding our reach. Equity capital markets activity continued to gain momentum into the year end, benefiting from an improving market backdrop for IPOs. We were a book runner in all of our equity transactions across products, and we continue to be diversified across sectors. Our equities business delivered a record quarter and year and had nine consecutive quarters of year-over-year revenue growth. Finally, our wealth management business had a record year and reached its highest quarter-end AUM of approximately $15.5 billion. As we look ahead, we believe 2025 steady build of activity will continue into 2026 and beyond. We expect many of the themes from 2025 to continue, including sustained engagement on large strategic transactions alongside a further broadening of activity across deal sizes, sectors, products, and geographies. Given the investments we've made across our platform, we believe Evercore is well positioned to serve clients across the full spectrum of the market. We start the year with strong momentum and backlogs at record levels. Overall, we are constructive on the environment. At the same time, we remain mindful of the geopolitical and macroeconomic risks and note that transaction timing can be uneven. Importantly, the strategy we've been executing over the last several years continues to deliver results. We remain focused on delivering outstanding client service and intend to continue investing thoughtfully as new opportunities arise. We're confident in our position as we start the new year. With that, let me turn it over to Tim. Thank you, John.