In addition to today's audio comments, we posted our earnings release on our website. A reconciliation of these non-GAAP financial measures to the comparable GAAP measure is provided in our earnings release and investor presentation. This transaction underscores how Lazard is building on its core advisory franchise while both diversifying our business model and accelerating our growth. Campbell Lutyens is a premier global private markets advisor focused on fund placement, secondary advisory, and GP capital advisory services.
Along with our existing PCA group, the transaction combines two highly complementary advisory platforms that will create the leading primary and secondary advisory business globally with approximately $500 million in anticipated combined 2027 revenue. The acquisition marks an important milestone on the path toward Lazard 2030 and an exciting avenue for additional growth. Lazard 2030 is a multi-year plan to build a more productive, resilient, growth-oriented firm. Our focus is on enhancing our long-standing strength in M&A while also building leading platforms in restructuring and liability management, Capital Solutions, and Private Capital Advisory.
Our recent investments have expanded the solutions we provide for clients and diversified our revenue mix. Revenue related to private capital connectivity has increased from approximately 25% of total advisory revenue in 2019 to 40% today. Upon closing the Campbell Lutyens acquisition, we will achieve our 2030 target of approximately 50% even while delivering total revenue growth. The acquisition of Campbell Lutyens and establishment of Lazard CL strengthens our ability to deliver for clients at a time when fundraising is increasingly competitive and liquidity solutions are more complex.
| Metric | Period | Current guidance |
|---|---|---|
| Adjusted compensation ratio | Full year 2026 | closer to ~65.5% (similar to last year) (Lower than Q1 2026 accrual of 69.9%, guided toward prior-year level) |
| Adjusted effective tax rate | Full year 2026 | high 20s% range |
| Asset Management average management fee rate | Remainder of 2026 | expected to stay around 44.6 bps level (Roughly stable) |
| Asset Management net flows | Full year 2026 | confident in net inflows for the full year, with possible moderation in coming months |
| Financial advisory MD net additions | 2026 | within the 10-15 net add range (Lower than 2025) |
| Metric | YoY | Note |
|---|---|---|
| Firm-wide adjusted net revenue | +5% | Robust growth in restructuring and liability management and private capital advisory, plus solid M&A performance in Europe, supported by the diversified model; partly offset by financial advisory transactions slipping to later in the year. |
| Financial advisory adjusted net revenue | -4% | Several transactions moved to later in the year; revenue was not as strong as the firm anticipates for the rest of the year. |
| Asset Management adjusted net revenue | +17% | Driven by management fees up 25%, reflecting strong net inflows and higher average AUM. |
| Asset Management management fees | +25% | Higher AUM and improved flows; average AUM was up 15% year-over-year. |
| Average AUM | +15% | Net inflows and market appreciation lifting assets versus the prior year. |
| Average management fee rate | +3.4 bps (41.2 to 44.6 bps) | Favorable mix of business; rate also up sequentially from 43.9 bps in Q4. |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Lazard 2030 strategy and private markets connectivity | ~25% of advisory revenue from private capital connectivity in 2019; 40% prior | 40% today, targeting ~50% upon Campbell Lutyens close; firm says it is ahead of schedule on 2030 plan | Accelerating |
| Campbell Lutyens acquisition / Lazard CL | — | All-stock upfront consideration based on a $46.50 reference share price; expected to close before year-end and be EPS accretive in 2027 with no synergies assumed; combined ~$500M 2027 revenue | New |
| Asset Management flows and emerging/international markets demand | — | $9 billion net inflows, best in nearly 20 years; strong one-but-not-funded pipeline; clients reallocating toward emerging and international markets; two-thirds of AUM non-dollar denominated | Strengthening |
| MD recruiting and ramp | 28 net adds in 2025; target 10-15 | Expect to be within the 10-15 range in 2026; about 40% of MDs still in ramping period, with majority of productivity gains yet to come | Normalizing |
| Private equity / sponsor M&A recovery | — | Still awaiting a substantial uptick; alternative asset manager leaders signal 2026 as a buy/sell year; firm sees a significant number of processes underway | Stable/uncertain |
| Geopolitical risk and supply chain repositioning | — | Multinational clients across all sectors rethinking supply chain footprints; choke-point risks better appreciated; firm positions contextual alpha and geopolitical advisory as a differentiator | Rising |
| Operational efficiency and cost discipline | — | Q1 non-comp ratio of 22.1%; CFO launched a long-dated program targeting support-function streamlining across geographies and businesses, with more detail expected in H2 2026 | Increasing focus |