Executive Summary

Strong Q4 finish: Net revenues $1.96B, +16% q/q and +63% y/y; diluted EPS (cont. ops) $0.91, +26% q/q and +214% y/y, driven by record Advisory and robust Capital Markets; pre-tax income $305M, +21% q/q and +249% y/y . Dividend raised 14.3% to $0.40 per share, underscoring confidence in earnings power .
Investment Banking led by record Advisory ($597M) and higher underwriting ($363M); Equities strong (+49% y/y), Fixed Income solid (+15% y/y); Asset Management net revenues lifted by fee/returns and consolidated “Other investments” (Stratos, Tessellis) .
Expense discipline continued: compensation ratio 50.2% (vs 51.1% y/y) and non-comp ratio 34.2% (vs 41.6% y/y), though non-comp rose q/q with higher brokerage/clearing and consolidated entities .
No explicit quantitative guidance provided; management points to stronger pipeline, market share gains, and more normalized markets supporting further margin expansion into 2025 .

What Went Well and What Went Wrong

What Went Well
- Record Advisory: “Advisory net revenues of $597 million represents our best quarter ever, due to market share gains and increased global mergers and acquisitions activity.”
- Broader strength: “Investment Banking (up 73%)… Equities (up 49%) and… Fixed income (up 15%)” y/y; net revenues $1.96B; EPS (cont. ops) $0.91 .
- Operating leverage: “Non-compensation expense ratio improved from 39% in 2023 to 34% in 2024… We are optimistic about our ability to continue to further expand operating margins” .
What Went Wrong
- Fixed Income moderated sequentially: $240.9M in Q4 vs $289.2M in Q3 (-17% q/q), even as y/y was +15% .
- Asset Management complexity: “Other investments… meaningfully higher… primarily due to the consolidation of Tessellis,” adding gross revenues and expenses; Weiss/352 Capital challenges noted for 2024 .
- Higher non-comp q/q: Non-comp ratio rose to 34.2% from 32.2% in Q3 on higher brokerage/clearing, technology/communications, business development costs, and consolidation effects .

Financial Results

Sequential trend (Q2 → Q4)

Metric	Q2 2024	Q3 2024	Q4 2024
Total Net Revenues ($MM)	1,656.4	1,683.6	1,956.6
Pre-tax Earnings from Cont. Ops ($MM)	227.8	252.7	304.9
Net Earnings Attrib. to Common ($MM)	145.7	167.1	205.7
Diluted EPS – Cont. Ops ($)	0.64	0.72	0.91
Compensation Ratio (%)	N/A	52.8	50.2
Non-Comp Ratio (%)	N/A	32.2	34.2
Income Tax Rate (%)	32.1	30.9	28.2

Year-over-year comparison (Q4 2023 → Q4 2024)

Metric	Q4 2023	Q4 2024
Total Net Revenues ($MM)	1,197.2	1,956.6
Pre-tax Earnings from Cont. Ops ($MM)	87.3	304.9
Diluted EPS – Cont. Ops ($)	0.29	0.91
Compensation Ratio (%)	51.1	50.2
Non-Comp Ratio (%)	41.6	34.2
Income Tax Rate (%)	19.3	28.2

Segment breakdown (sequential)

Segment Net Revenues ($MM)	Q2 2024	Q3 2024	Q4 2024
Advisory	283.9	592.5	596.7
Equity Underwriting	249.2	150.1	191.2
Debt Underwriting	205.5	183.1	171.5
Total Investment Banking	803.2	949.5	986.8
Equities	407.1	381.4	410.8
Fixed Income	284.2	289.2	240.9
Total Capital Markets	691.3	670.6	651.7
Asset Mgmt Net Revenues	156.5	59.0	314.8
Total Net Revenues	1,656.4	1,683.6	1,956.6

KPIs

KPI	Q2 2024	Q3 2024	Q4 2024
Book Value/Share ($)	46.57	48.89	49.42
ATBV/FD Share ($)	31.27	31.87	32.36
Common Shares (MM, GAAP)	212.053	205.495	205.504
Fully Diluted Shares (MM, non-GAAP)	253.663	253.799	253.901
Income Tax Rate (%)	32.1	30.9	28.2
Comp Ratio (%)	N/A	52.8	50.2
Non-Comp Ratio (%)	N/A	32.2	34.2
Avg VaR ($MM)	13.36	11.35	12.75
Trading Loss Days (Quarter)	1	8	8
Total Assets ($B)	63.00	63.28	64.36
Tangible SH Equity ($B)	7.82	7.97	8.10
Leverage Ratio (x)	6.3	6.3	6.3
Tangible Gross Leverage (x)	7.8	7.7	7.7

Notes:

Asset Management “Other investments” includes consolidated Stratos/Tessellis beginning in late 2023, materially raising gross revenues/expenses with nominal earnings impact in Q4/Q4 YTD .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Quarterly Dividend/Share	Declared for Feb 27, 2025 payment	$0.35 (Q3 declared)	$0.40	Raised
Revenue/Margins/OpEx/OI&E/Tax Rate	FY/Quarter	Not provided	Not provided	Maintained (no guidance)
Segment Guidance (IB/CM/AM)	FY/Quarter	Not provided	Not provided	Maintained (no guidance)

No quantitative financial guidance was provided; management emphasized operating margin expansion potential with scale and continued expense discipline .

Earnings Call Themes & Trends

Note: An earnings call transcript for Q4 2024 was not available in our document set, so themes reflect management’s press release and shareholder letter commentary.

Topic	Q2 2024 (prior)	Q3 2024 (prior)	Q4 2024 (current)	Trend
Investment Banking pipeline/activity	Momentum building; backlog improving; optimistic for 2H24/2025	Record Advisory; continued market share gains; strong pipeline into year-end	Record Advisory; 2024 IB net rev +52% y/y; record market share across products/regions	Improving, share gains
ECM market	Robust equity underwriting; improving volumes	Equity underwriting flat y/y in Q3, but strong overall; momentum	Equity underwriting up y/y; continued investment in electronic/equity derivatives	Gradual broadening
Fixed Income	Solid but moderating after strong Q1	Up y/y; strength in credit trading	Up y/y; particular strength in distressed/securitization; softer q/q	Stable to improving y/y
Expense discipline/margins	Margin improvement vs last year; tech investments to lift productivity	Positive margin/return metrics direction	Non-comp ratio improved y/y; aiming to further expand operating margins	Positive operating leverage
Asset Management	Reasonable; normalization after strong Q1	AM net rev up y/y; some strategy headwinds; Stratos/Tessellis consolidation	Fees/returns stronger; Other investments higher from consolidation; Weiss/352 challenges acknowledged	Mixed; improving fees/returns
Strategic partnerships (SMFG/SMBC)	Alliance gaining momentum	Team expanded; well positioned	SMFG 14.5% fully diluted; partnership deepening (Board seat)	Strengthening
Macro/backdrop	Normalizing rates; growing opportunity	Declining rates backdrop supportive	“Financial stars aligning,” broader investor interest beyond mega-cap tech; IPO/M&A backlog improving	More supportive

Management Commentary

“Our fourth quarter net revenues of $1.96 billion, pre-tax earnings… $305 million and diluted EPS… $0.91 are 63%, 249% and 214% higher than the prior year quarter… strong performance in Investment Banking (up 73%)… record quarter in Advisory (up 91%)… robust Equities (up 49%) and solid Fixed income (up 15%).”
“Our non-compensation expense ratio improved from 39% in 2023 to 34% in 2024… optimistic about our ability to continue to further expand operating margins.”
“Jefferies begins 2025 in the best position ever… our clients are rewarding us with broad global growth and an enhanced market position… After decades of hard work, we are in the front row of the pack.”
Shareholder letter: “We begin [fiscal] 2025 with a renewed M&A pipeline… a growing IPO backlog… elevated trading volumes… our 2024 recovery year delivered $7.0 billion in net revenues, $1.0 billion in pre-tax income… $2.96 in diluted EPS… a return on adjusted tangible shareholders’ equity… of 10.8%.”
Market position: “Our market share across M&A, ECM and Leveraged Finance established us as the world’s 6th largest investment bank… 5th in M&A… 6th in ECM… 3rd in Financial Sponsor M&A.”

Q&A Highlights

No Q4 2024 earnings call transcript was available in our document set; therefore, we cannot provide Q&A highlights or call-based guidance clarifications for this quarter. (Searched earnings-call-transcript for JEF; no results found.)

Estimates Context

Wall Street consensus (S&P Global) for Q4 2024 EPS and revenue could not be retrieved due to access limits at query time; as a result, we cannot quantify beat/miss versus consensus for this quarter. We recommend checking S&P Global to finalize the comparison to consensus and update trading implications accordingly.

Key Takeaways for Investors

Jefferies’ Q4 showed high-quality revenue with record Advisory and broad strength across Equities and underwriting; sequential pre-tax and EPS acceleration suggests improving operating leverage into FY25 .
Capital Markets remained resilient; Equities strength more than offset Fixed Income’s q/q moderation; y/y momentum remains intact across trading franchises .
Expense discipline is delivering: compensation ratio trended lower y/y, and non-comp ratio improved materially y/y; management expects further margin expansion with scale .
Asset Management contributions improved on fees/returns, while consolidated Other investments inflate gross revenue/expenses but have nominal earnings impact; monitoring for clarity as 10-K finalizes .
Dividend increased to $0.40, reflecting confidence in earnings durability and capital return priorities .
Strategic partnership with SMFG and market-share gains position JEF well for a more constructive IB environment (rising M&A/IPO backlogs); potential 2025 catalysts include stronger sponsor M&A and continued ECM normalization .
Actionable: In absence of confirmed consensus comparison, trading focus should be on the quality of IB recovery, y/y operating leverage, and durability of Equities strength; watch early-2025 fee events (M&A closes, ECM windows) and Fixed Income trend vs Q3 peak as incremental stock drivers.

Additional supporting detail and disclosures:

Comprehensive financial summary, segment detail, ratios and capital metrics are provided in the Q4 press release and Form 8-K (Item 2.02) .
Prior two quarters for trend analysis: Q3 press release (record Advisory; margins improving) ; Q2 8-K (dividend increase; building backlog) .

Jefferies Financial Group Inc. (JEF)·Q4 2024 Earnings Summary