Oct 28, 2026 earnings call — Record results, recruiting, and investment banking strength
Reported record quarterly revenues of $4.27 billion and record net income, with earnings per diluted share of $3.40.
Revenue $4.3B (est $4.2B) · EPS $3.59 (est $3.26)
Key quotes
"Over the fiscal year, we recruited financial advisers to our domestic independent contractor and employee channels with trailing 12-month production totaling $538 million and more than $82 billion of client assets at their previous firms."
"In the Bank segment, loans ended the quarter at a record $57.5 billion driven predominantly by continued growth in securities-based lending balances. Those balances increased more than $6 billion or 32% from the year ago period and 6% sequentially."
Analyst Q&A 13
Buyback pause reason
Q (David Smith · Truist): Why did you curtail the buyback despite Tier 1 leverage rising to 12.1%? Was the pause due to an M&A review or other shifts in capital allocation?
A: Management said they suspended buybacks while evaluating an M&A opportunity. That opportunity does not look like it will progress, and their plan is to resume buybacks at the prior $400 million a quarter level going forward.
"As of right now, our plan is to resume buybacks at that $400 million a quarter level going forward." — Paul Shoukry (CEO)
Funding loan growth and NIM
Q (William Katz · TD Cowen): How are you thinking about balance sheet strategy to fund loan growth (security-based lending, mortgages) and the NIM outlook given deposit and third-party sweep balances?
A: Management said they have lots of flexibility from cash with third-party banks and diversified deposit sources, so loan-to-deposit is less relevant. They said they are more focused on growing NII and BDP fees over time rather than optimizing NIM, and on supporting clients and improving profitability.
"And to your point, we're really more focused on growing NII and BDP fees over time than optimizing NIM." — Paul Shoukry (CEO)
Why NIM fell this quarter
Q (Craig Siegenthaler · BofA): Why did NIM decline this quarter despite higher short-term rates? Liability costs rose faster than asset yields — how should we think about near-term NIM?
A: Management said one driver was the ramp-up of higher-cost ESP deposit balances, which created a full-quarter effect in Q4 and pressured NIM. They also said they increased yields from third-party banks by 6 basis points and that, over time, floating assets and rate hikes should be a tailwind to NII and NIM.
"So basically, in Q4, we experienced a full quarter effect of the increase in those higher cost deposits, and that was an impact on NIM." — Jonathan Oorlog (CFO)
Recruiting competition and sustainability
Q (Michael Cyprys · Morgan Stanley): How do you see the recruiting competitive environment and adviser movement? Can the recruiting growth you had be sustained into fiscal '27?
A: Management said pipelines across all affiliation options are balanced and strong. They highlighted the firm's differentiated value proposition, scale, and long-term time horizon as reasons recruiting is economically attractive and sustainable for Raymond James.
"We feel really good about our pipelines across all of our affiliation options." — Paul Shoukry (CEO)
PCG pay rate and margins
Q (Alexander Blostein · Goldman Sachs): With recruiting and transition assistance ramping, how should we think about the Private Client Group (PCG) comp rate and margin into '27 off a roughly 75% comp rate?
A: Management said continuing investments in growth and transition assistance will pressure comp ratio and margin in the near term, but they are disciplined on noncomp spending and still grew pretax income in PCG this year. They noted independent contractor payouts are higher but those advisers absorb fixed costs, and other factors are creating leverage that can offset comp pressure.
"So I think while we may see some increase in the comp ratio in the segment, there are other aspects that are creating leverage for the segment." — Jonathan Oorlog (CFO)
Advisers leaving to form RIAs
Q (Chris O'Brien · Wolfe): Are you seeing large advisory teams on your platform try to become independent RIAs? What risk does that pose and how does it affect your economics?
A: Management said they offer adviser choice across all affiliation options and are agnostic about which channel an adviser picks. They said they are seeing strong interest across channels, with the independent contractor channel showing the most dollar-volume interest recently.
"So we are seeing incredible interest across all our affiliation options, as Butch mentioned in the last couple of years, the independent contractor channel in terms of dollar volume is where we've seen the most interest." — Paul Shoukry (CEO)
M&A priorities
Q (Y. Cho · JPMorgan): As you start fiscal '27, what are your M&A priorities and where would you look to close capability gaps or expand growth?
A: Management said wealth management is their biggest focus for acquisitions, and any deal must be a cultural fit, a strategic 1 plus 1 equals more than 2 fit, and make financial sense for all parties. They avoid acquisitions meant to slash costs and are not pursuing traditional brick-and-mortar bank deals.
"And when I say good acquisitions for us, acquisitions have to be first and foremost, a good cultural fit" — Paul Shoukry (CEO)
Investment banking pipeline outlook
Q (Daniel Fannon · Jefferies): Is there anything different about the investment banking pipeline now versus a quarter or a year ago in terms of activity, clients, or deal types?
A: Management said the pipeline has been strong for a while and deal closings determine when revenue is realized. They noted much of their M&A work is driven by financial sponsors with portfolio companies acquired in the early 2020s that may be beyond original holding periods, and they continue to invest in the platform.
"A lot of these portfolio companies were portfolio companies that were acquired back in the early 2020s, during COVID." — Paul Shoukry (CEO)
How NIM reacts to rate hikes
Q (Benjamin Budish · Barclays): How should we think about NIM responding to further short-term rate increases, timing of asset repricing, and liability betas?
A: Management said their aggregate BDP NII guidance assumes the full impact of the September 25 basis point hike, with deposits repricing immediately and assets taking longer to reprice. They said future impacts depend on deposit betas and market conditions, so exact effects are hard to project, but generally expect rate hikes to be a tailwind.
"So the -- in the guidance that we provided of the aggregate BDP NII guidance up 1% in the upcoming quarter." — Jonathan Oorlog (CFO)
iBank revenue durability and deposit trends
Q (Brennan Hawken · BMO): Are the better-than-expected investment banking revenues sustainable and are sponsors reengaging more durably? Also, why did CD rates come down publicly this week, and what are October cash trends so far?
A: Management said they are optimistic about the reengagement and pipeline but acknowledge quarter-to-quarter uncertainty and that Q4 is historically strong for them. On CD rates, they said rate moves depend on demand for different tenures and shouldn't be overread; they reported fee billings of $2.1 billion came out earlier in the month and current balances are about $1.7 billion lower than month end, meaning they are about $400 million better than the $2.1 billion outflow.
"As we sit here today, those balances are about $1.7 billion lower than the month end." — Jonathan Oorlog (CFO)
Same-store growth and muni marks
Q (Devin Ryan · Citizens Bank): Can you separate recruited assets from same-store growth and what could accelerate same-store growth? Also, was the fixed income brokerage decline mainly marks on munis and is that temporary?
A: Management said they saw a nice uptick in same-store sales this fiscal year and that technology and AI (like a meeting manager workflow) are helping advisers save time and gain share of wallet. They also said the fixed income brokerage decrease was largely driven by marks on the muni trading inventory, and they view that as a temporary dislocation with potential to recover.
"We saw a pretty nice uptick in same-store sales of what we call it, in the past fiscal -- in this fiscal year." — Paul Shoukry (CEO)
Selling retail-alts and fees
Q (Daniel F. Welden · Wells Fargo): How are you approaching distribution of evergreen or semiliquid retail-alternative products through PCG, and how do the economics and fee structures work?
A: Management said these products are a relatively small part of the firm's asset mix and they offer a competitive, broad set of options but do not mandate or push sales. They said fee structures vary by sponsor and product and they could not provide more specific color on fees on the call.
"I mean it's a part -- it's a relatively small part of our overall asset mix at the firm." — Paul Shoukry (CEO)
Operating leverage and margins
Q (William Katz · TD Cowen): Can you break down October cash between ESP sweep and other balances? More broadly, what is the algorithm for driving better operating leverage and margin given PCG margin pressure and sluggish NII guidance?
A: Management said adjusted pretax margin finished the year at 20.3%, above their 20% target, achieved while making record growth investments. They said they focus on long-term profitability through growth, scale, and disciplined expense control, are flattening noncomp growth with AI efficiencies, and will not sacrifice long-term growth to optimize near-term margins; Jonathan added most of the October outflow came from the sweep program rather than ESP balances.
"And I'll just add in terms of your initial question, most of that comes out of the sweep program as opposed to ESP balances." — Jonathan Oorlog (CFO)