Our record first quarter results reflect the strong momentum that built throughout the second half of 2025, as well as the benefits of our multi-year investment strategy. Firmwide adjusted net revenues were $1.4 billion, double from a year ago and a new quarterly record for the firm. Revenues increased 8% sequentially from the fourth quarter, marking the first time in 15 years we've delivered growth from that period. We are constructive on the outlook of our business and believe we are well positioned to serve our clients across a range of market environments.
Turning to talent, since our last call, three Senior Managing Directors have joined our investment banking practice in healthcare, equity capital markets, and private capital advisory. 3 additional SMDs have committed to join our franchise in key areas, including healthcare, industrials, and private capital advisory this year. In total, we now have 182 SMDs in investment banking, with more than 45 ramping, positioning us to drive sustained growth in activity over time. In North America Strategic Advisory, we achieved a new quarterly record for revenue, reflecting strong transaction announcements, trends carrying on from 2025, and strong activity levels across both corporates and financial sponsors.
Our EMEA Strategic Advisory business delivered a record first quarter with strong activity across a number of sectors and geographies. Our private capital markets and debt advisory team remained active, particularly with structured minority deals, despite some lengthening in transaction timelines. The Private Funds Group also delivered a record first quarter, despite a challenging environment for fundraising. Our equity capital markets business had a solid quarter with revenues in line with the prior year.
| Metric | Period | Current guidance |
|---|---|---|
| Q2 2026 revenue | Q2 2026 | Closer to Q2 2025 (a record) rather than continued sequential growth (new) |
| Compensation ratio improvement | FY2026 | Meaningfully more modest improvement than last two years (lower magnitude) |
| Non-compensation expense growth | FY2026 | Similar growth rate to the last couple of years (new) |
| Effective tax rate | Remaining three quarters FY2026 | More similar to prior-year levels in those quarters (higher than Q1) |
| Metric | YoY | Note |
|---|---|---|
| Adjusted net revenues | +100% to ~$1.4B | Significant increase in large transaction closings and broad-based strength across all businesses |
| Adjusted operating income | +205% to $354M | Strong environment and high first-quarter revenues driving operating leverage |
| Adjusted EPS | +116% to $7.53 | Record revenues and margin expansion |
| Adjusted advisory fees | +123% to ~$1.2B | Surge in large transaction closings plus continued productivity gains |
| Commissions and related revenue | +14% to $63M | Higher trading volumes amid market volatility |
| Adjusted asset management and administration fees | +8% to ~$24M | Growth in wealth management AUM |
| Adjusted operating margin | +~870 bps to 25.3% | Strong environment combined with high first-quarter revenues |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Large cap strategic M&A | Major part of the market for ~18 months | Continues to outperform, with CEO confidence, resilient economy, abundant financing, and scale seen as positive supporting further activity | Improving |
| Middle-market financial sponsors | Slowest to rebound | Has slowed but not at a standstill; Evercore's pitch and win rates are up versus a year ago | Improving |
| Software sector M&A | — | A slowdown but not a standstill, with consolidation opportunities and some restructuring activity emerging | Deteriorating |
| Private capital advisory and secondaries | Record year prior | Record first quarter with balanced LP/GP-led activity and momentum in private credit and secondaries | Improving |
| AI impact | — | Viewed as creating M&A and restructuring opportunities from industry structural change, plus internal productivity gains over time | Improving |
| Talent competition | Competitive | Ante raised and more competitive, but Evercore finding success attracting A-plus players given franchise momentum | Stable |