PIPER SANDLER COMPANIES (PIPR)·Q4 2025 Earnings Summary

Piper Sandler Delivers Record Q4 as Advisory Boom Drives 38% Revenue Surge; Announces 4-for-1 Split

February 6, 2026 · by Fintool AI Agent

Piper Sandler (NYSE: PIPR) delivered a blowout fourth quarter, posting record net revenues of $666 million—up 38% year-over-year—driven by an M&A advisory boom and strength across its investment banking franchise . The investment bank also announced a 4-for-1 stock split and a $5.00 special dividend, signaling management's confidence in the firm's trajectory .

CEO Chad Abraham called it "a fantastic finish to 2025," highlighting full-year revenues of $1.9 billion (+24% YoY) fueled by record advisory performance .

Did Piper Sandler Beat Earnings?

Piper Sandler crushed expectations on both the top and bottom line:

The quarter marked the firm's strongest on record for both GAAP and adjusted net revenues . Pre-tax margin expanded over 11 percentage points year-over-year as the firm demonstrated strong operating leverage on higher revenues .

What Drove the Record Quarter?

Advisory services was the standout performer, generating $403 million in Q4 (+44% YoY) and a record $1.04 billion for the full year (+28%) . Five of seven industry groups delivered year-over-year growth, with financial services and services & industrials leading the charge .

Segment Performance:

The firm completed 335 advisory transactions in 2025—16% more than the prior year—and earned higher average fees . Municipal financing generated revenues of $146 million for the full year, the firm's second-best on record .

Additional Segment Highlights:

• Non-M&A Advisory exceeded 25% of total advisory revenues for the first time, led by debt capital markets advisory, private capital advisory, and restructuring
• Corporate Financing completed 122 equity, debt, and preferred financings in 2025, raising $48 billion for corporate clients
• Equity Brokerage attracted ~1,700 unique clients and traded 11 billion shares on their behalf
• Financial Services priced 65 transactions raising $19 billion in capital for clients

Full Year 2025 Highlights

Record institutional brokerage revenues of $433 million (+8% YoY) included the best year ever for equity brokerage ($230 million) and the second-strongest year for fixed income .

How Did the Stock React?

Piper Sandler shares closed at $331.63 on February 5, down 3.7% ahead of the report. After-hours trading saw the stock jump +4.3% to $346.00 following the earnings release and capital return announcements.

Key after-hours catalysts:

• Record Q4 revenues exceeding expectations
• 4-for-1 stock split announcement
• $5.00 special dividend declaration
• Bullish CEO commentary on 2026 positioning

The stock has gained approximately 63% over the past 12 months, significantly outperforming the broader market.

What Capital Returns Were Announced?

Piper Sandler's board approved substantial shareholder returns:

Stock Split:

• 4-for-1 forward stock split
• Effective at 4:30 PM ET on March 23, 2026
• Trading on split-adjusted basis begins March 24, 2026
• Intended to increase liquidity and accessibility

Dividends:

• $5.00 per share special dividend (payable March 13, 2026)
• $0.70 per share quarterly dividend
• Total FY 2025 dividend: $7.70 per share (+40% vs FY 2024)
• Dividend payout ratio: 43% of adjusted net income

Share Repurchases:

• Q4 2025: 59K shares repurchased at avg. $337.34
• FY 2025: 421K shares repurchased for $125 million at avg. $297.22
• Total capital returned in FY 2025: $239 million

M&A Acquisition Appetite: On using cash for acquisitions, Abraham noted: "We've delivered great returns in terms of the acquisitions and deals we've done. And I think we're in a really good environment for that." He added that as boutique peers see a recovery, there's "a lot more interest on the sell side," making him "pretty optimistic about the pipeline" .

What Did Management Say?

CEO Chad Abraham struck an optimistic tone on the firm's positioning and set a bold medium-term target:

"We had a strong finish to the year with record-adjusted net revenues of $635 million in the fourth quarter, a 27.2% operating margin, and adjusted EPS of $6.88."

On the $2B+ revenue goal, Abraham noted that JP Peltier, Mike Dillahunt, and James Baker will lead the corporate investment banking business to accomplish the medium-term goal of growing annual revenues to $2 billion or more in the coming years .

Key Talent Moves:

• Named J.P. Peltier as co-head of investment banking and capital markets alongside Mike Dillahunt and James Baker
• Peltier is a 25-year Piper Sandler veteran who previously co-headed healthcare IB
• Appointed Mike Piper as head of fixed income
• Added five investment banking MDs in technology, financial services, and chemicals
• Launched private markets trading with three new MD hires

Market Leadership Positions:

• #1 advisor in U.S. bank M&A by number of announced transactions in 2025
• #2 advisor in U.S. M&A deals under $1 billion
• #2 nationally in K-12 education by number of issues and par amount
• 50% market share in special district municipal financing in states where they compete

What Changed From Last Quarter?

The dramatic sequential improvement reflects the typical Q4 seasonality in M&A deal closings, amplified by what management called a record quarter for the financial services and services & industrials teams .

Balance Sheet & Headcount

The firm continues to invest in talent with headcount up 3% year-over-year and 4 net new investment banking managing directors added in Q4 .

What Did Management Guide for 2026?

CFO Kate Clune provided specific forward guidance on the call :

President Deb Schoneman noted the fixed income outlook depends on credit spreads—currently "really tight"—causing some investor hesitation, but expects bank M&A-related balance sheet repositioning work to remain strong .

Q&A Highlights

On Sponsor Activity (Devin Ryan, Citizens Bank): Chad Abraham described sponsor deal flow as a "steady march of improvement" over the past few years, with sponsors increasingly seeking liquidity on their top one or two positions . The diversified services and industrials team—which is "pretty much entirely a private equity sponsor business"—had the biggest step-function improvement of any team .

On ECM Volatility (James Yarrow, Goldman Sachs): Abraham offered a candid assessment of equity capital markets: "I've been doing this a long time, so I'm always reminded how quick and humbling the equity capital markets can be to your financing business." Healthcare has outperformed in the recent tech-led selloff, providing diversification benefits .

On Non-M&A Advisory Growth (Brendan O'Brien, Wolfe Research): Non-M&A advisory revenues now exceed 25% of total advisory revenues for the first time . Key components include debt capital markets advisory (third consecutive record year), private capital advisory, and restructuring. Abraham noted: "For the last several years, it has outpaced [M&A growth]. Now, some of that has been we're also adding products, and there's a lot of runway in PCA."

On Middle Market M&A (Daniel Cucchiara, Bank of America): While large-cap M&A dominated 2025 headlines, Piper Sandler focuses on the middle market where deals under $1 billion grew high single digits. "The vast majority of our volume is in that middle market," Abraham emphasized, with over 50% of that activity sponsor-based .

On Pipeline/Backlog (Mike Grondell, Northland Securities): Abraham noted several larger advisory transactions closed in the last week of December, which impacts January announcements. However, "backlogs are good" and seasonality is fairly typical, with Q1 always the toughest quarter to predict .

What Are the Risks?

Management flagged several forward-looking risks in the filing :

• Deal Volume Volatility: Advisory revenues depend on transaction timing and can vary materially quarter-to-quarter
• Macro/Geopolitical: Market conditions, trade policy (including tariffs), and investor uncertainty could impact deal activity
• Integration Risk: G Squared Capital Partners acquisition benefits may take longer to materialize than expected
• Interest Rate Sensitivity: Fixed income business could face pressure from rate volatility

Key Takeaways

1. Record quarter delivered: $666M net revenues and $6.88 adjusted EPS represent the firm's strongest Q4 ever
2. Advisory business firing: $403M in Q4 advisory revenues (+44% YoY) powered by strength in financial services and industrials
3. Shareholder-friendly actions: 4-for-1 stock split, $5.00 special dividend, and ongoing buybacks signal confidence
4. 2026 outlook constructive: CEO Abraham noted the firm is "well-positioned" heading into the new year
5. Operating leverage on display: Pre-tax margin expanded to 28.3% as compensation ratio declined

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Piper Sandler Companies (NYSE: PIPR) is a leading investment bank offering securities brokerage, investment banking, and alternative asset management services. The firm has approximately 1,858 employees and 187 investment banking managing directors.

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