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JONES LANG LASALLE INC (JLL)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 revenue rose 16% year over year to $6.81B; adjusted diluted EPS was $6.15 (+15% YoY) and adjusted EBITDA was $454.8M (+19% YoY) .
  • Transactional strength drove the quarter: Capital Markets revenue +32% YoY, Leasing +14% YoY; Work Dynamics delivered its fourth straight quarter of double-digit growth .
  • Cash generation inflected sharply: Q4 operating cash flow $927M and free cash flow $868M; net debt fell to $801M and net leverage to 0.7x, with liquidity of $3.62B .
  • 2025 outlook: management targets adjusted EBITDA of $1.25–$1.45B (midpoint +14% YoY), expects consolidated and segment margin expansion, and plans share repurchases at least to offset stock comp dilution .
  • Strategic catalysts: accelerated investment sales/debt advisory activity, improving office leasing cycle, and consolidation of AI tools (JLL Partner, JLL GPT, Azara) to drive productivity and differentiation .

What Went Well and What Went Wrong

What Went Well

  • Adjusted EBITDA grew 20% in Q4 on transactional acceleration and resilient revenue momentum; adjusted EPS up 17% YoY, demonstrating operating leverage across the platform (“adjusted EBITDA grew 20% in the fourth quarter… adjusted EPS grew 17%”) .
  • Capital Markets strength: investment sales revenue grew over 35% and global debt advisory ~70% in Q4; U.S. investment sales +~60% vs market +51% per JLL Research, highlighting share gains .
  • Office leasing recovery: global office leasing grew 20% QoQ in Q4, and the U.S. posted first positive absorption since Q4’21; large deals (>100k sf) rose ~25% QoQ, supporting Markets Advisory growth .

What Went Wrong

  • JLL Technologies softness: revenue -9% YoY and adjusted EBITDA fell to $1.5M in Q4, driven by lower technology solutions bookings and carried interest effects .
  • Work Dynamics profitability headwinds: Q4 adjusted EBITDA flat YoY as lower actuarial benefit (~$13M) and incremental platform investments (including AI) offset top-line growth .
  • LaSalle advisory fees declined on lower AUM and European restructuring; despite Q4 incentive fees increasing, full-year LaSalle revenue decreased and adjusted EBITDA was roughly flat YoY .

Financial Results

Quarterly Financials (oldest → newest)

MetricQ4 2023Q2 2024Q3 2024Q4 2024
Revenue ($USD Billions)$5.881 $5.629 $5.869 $6.811
Diluted EPS ($)$3.57 $1.75 $3.20 $4.97
Adjusted Diluted EPS ($)$5.36 $2.55 $3.50 $6.15
Adjusted EBITDA ($USD Millions)$383.1 $246.3 $298.1 $454.8
Effective Tax Rate (%)19.6% 19.5% 19.5% 19.5%

Segment Breakdown — Q4 2024 vs Q4 2023

SegmentRevenue Q4 2023 ($MM)Revenue Q4 2024 ($MM)Adj. EBITDA Q4 2023 ($MM)Adj. EBITDA Q4 2024 ($MM)
Markets Advisory$1,197.4 $1,328.0 $160.5 $170.8
Capital Markets$537.1 $706.4 $76.1 $119.9
Work Dynamics$3,966.1 $4,556.6 $120.5 $120.0
JLL Technologies$65.5 $59.3 $6.1 $1.5
LaSalle$115.3 $160.6 $19.9 $42.6

KPIs and Balance Sheet

KPIQ2 2024Q3 2024Q4 2024
Cash Flow from Operations ($MM)$273.9 $261.6 $927.3
Free Cash Flow ($MM)$235.7 $216.7 $868.1
MetricDec 31, 2023Sep 30, 2024Dec 31, 2024
Net Debt ($MM)$1,150.3 $1,597.3 $800.6
Net Leverage (x)1.2x 1.4x 0.7x
Corporate Liquidity ($MM)$3,085.0 $3,392.8 $3,616.3
Share Repurchases (Q4)Amount
Shares repurchased (000s)75.2
Cash paid ($MM)$20.1
Authorization remaining ($MM)$1,013.2

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Adjusted EBITDA ($B)FY 2025N/A$1.25–$1.45 New range introduced
Consolidated/Segment MarginsFY 2025Long-term targets unchanged Expect margin expansion across consolidated and segments Maintained framework; positive trajectory
Workplace Management GrowthFY 20252024 double-digit growth Growth to moderate as 2024 wins are lapped; pipeline remains strong Lower near-term growth rate
Net LeverageQ1 20250.7x at YE 2024 Seasonal increase expected in Q1 Increase expected due to comp/tax payments
Capital AllocationOngoing$1.013B authorization at YE 2024 Repurchases at least to offset stock comp dilution; balanced vs M&A Maintained capital return posture

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 2024)Previous Mentions (Q3 2024)Current Period (Q4 2024)Trend
AI / Technology initiativesJLL Technologies bookings soft; carried interest headwind Enhanced digital leasing via Raise acquisition Consolidated “JLL Partner”; JLL GPT adoption; Azara analytics; JV to scale Asset Beacon Accelerating platform deployment and client-facing use cases
Capital Markets pipeline & ratesBroad-based growth despite rate uncertainty Momentum in investment sales; U.S. outperformance Robust pipeline; bid intensity index stable; strong start to 2025 Strengthening activity against still-low base
Office leasing cycleLeasing +5%; office improved; industrial weak Leasing +21%; larger deals rebounded; industrial flat Global office leasing highest since 2019; U.S. positive absorption; >100k sf deals +~25% QoQ Recovery broadening; flight to quality persists
Industrial leasingDeclines; excess capacity being worked through Flat YoY; deal size rebound Stabilization expected in 2025; JLL share gains in large transactions Near-term stabilization; mid/long-term constructive
LaSalle AUM / AdvisoryRevenue -29%; AUM -7% YoY AUM -9% YoY; advisory down Q4 incentive fees up; AUM +5% QoQ; ~3% LC YoY decline Signs of stabilization with FX/valuation headwinds
Regulatory / LoansFannie Mae loan repurchase impact expected Repurchase depressed margins Borrower fraud portfolio under agency discussion; working toward resolution Issue managed; monitoring ongoing
FX / Macro40% ex-U.S. revenue; FX a factor Interest rate stability aiding sentiment Stronger USD assumed in 2025 guidance; uneven recovery by geography Mixed macro; FX headwind in outlook

Management Commentary

  • “Adjusted EBITDA grew 20% in the fourth quarter. Adjusted EPS grew 17%. For the full year, adjusted EBITDA and adjusted EPS grew an impressive 28% and 38%, respectively… testament to our ability to drive operating leverage across the platform.” — CEO Christian Ulbrich .
  • “Our investment sales revenue… grew over 35%, and our global debt advisory revenue grew approximately 70%… driven in part by our leading platform, technology and people.” — CFO Karen Brennan .
  • “Globally, office leasing was at its highest level since 2019… and in the U.S., the fourth quarter marked the first quarter of positive absorption since the fourth quarter of ’21.” — CFO Karen Brennan .
  • “We are targeting a full year 2025 adjusted EBITDA range of $1.25 billion to $1.45 billion… reflective of 14% growth at the midpoint.” — CFO Karen Brennan .
  • “We have a couple of dozen AI products now… the main task is to stay disciplined and focus on areas with the biggest impact… we can make massive productivity gains.” — CEO Christian Ulbrich .

Q&A Highlights

  • Guidance construction and seasonality: FY25 EBITDA midpoint assumes gradual transactional recovery; typical profit seasonality (Q1 low-teens, Q4 ~40%); stronger USD a headwind given 40% ex-U.S. revenue .
  • Incremental margins: 2024 had one-offs (Fannie Mae repurchase in Capital Markets; lower actuarial benefit and gross receipts tax in Work Dynamics) that distorted quarterly margins; expect moderation to historical ranges in 2025 .
  • Office leasing outlook: Recovery broadening with flight-to-quality; potential spillover to upgraded Grade B assets given limited new supply; markets with notable growth include New York area, Kansas City, San Antonio, LA, SF .
  • Capital allocation: Share repurchases will at least offset stock comp dilution; balanced against platform investment and selective M&A in volatile macro/geopolitical backdrop .
  • JLL Technologies trajectory: Target full-year profitability in 2026; recent write-downs concentrated in one investment, offset by gains elsewhere; PropTech portfolio strategic to deliver client outcomes .

Estimates Context

  • Wall Street consensus (S&P Global) for Q4 2024 EPS/Revenue was unavailable due to SPGI request-limit errors at retrieval time; therefore, comparisons to consensus are not included. Values retrieved from S&P Global were unavailable at the time of drafting.

Key Takeaways for Investors

  • Transactional recovery is gaining momentum (investment sales, debt advisory, leasing), while resilient lines (Workplace and Property Management) sustain double-digit growth—supporting 2025 margin expansion .
  • Free cash flow inflected in Q4 and de-leveraging accelerated (net leverage 0.7x), providing capacity for reinvestment and shareholder returns; expect seasonal leverage uptick in Q1 .
  • Office leasing cycle shows tangible improvement (highest global activity since 2019; U.S. positive absorption), a tailwind for Markets Advisory; industrial stabilizing into 2025 .
  • Capital Markets outperformance vs market indicates share gains; pipeline is robust and rate stability supports sustained activity—key near-term trading catalyst .
  • JLL Technologies remains a drag near term but has a clear path to profitability and is strategically important; AI platform consolidation (JLL Partner) should drive productivity and margin leverage over time .
  • Watch LaSalle revenue mix: incentive fees buoy Q4, but advisory fee pressure and FX/valuation dynamics persist; AUM improved QoQ and could stabilize with deployment momentum .
  • Near-term positioning: Favor exposure to JLL on transactional momentum and improving office fundamentals; monitor FX headwinds and progress on loan/fraud resolution with agencies for potential volatility .