Oppenheimer Holdings Inc. Reports Second Quarter 2025 Earnings
Rhea-AI Summary
Oppenheimer Holdings (NYSE:OPY) reported strong Q2 2025 results with net income of $21.7 million ($2.06 per basic share), more than doubling from $10.3 million ($0.99 per share) in Q2 2024. Revenue increased 12.9% to $373.2 million, driven by improved performance across segments.
The Wealth Management division saw revenue rise 5.1% to $246.4 million, with assets under management reaching a record $52.8 billion. Capital Markets revenue surged 33.5% to $123.0 million, significantly reducing its pre-tax loss to $3.9 million from $21.8 million year-over-year.
The company maintained strong capital positions, with stockholders' equity reaching $896.9 million and declared a quarterly dividend of $0.18 per share. The effective tax rate improved to 32.7% from 35.3% in the prior year period.
Positive
- Net income more than doubled year-over-year to $21.7 million
- Revenue increased 12.9% to $373.2 million
- Assets under management reached record high of $52.8 billion
- Investment banking revenue surged 49.5% to $43.5 million
- Advisory fees grew 7.2% to $125.6 million
- Stockholders' equity and book value reached new record highs
Negative
- Bank deposit sweep income decreased 17.8% to $28.7 million
- Capital Markets segment still operating at a pre-tax loss of $3.9 million
- Non-compensation expenses increased 22% to $30.5 million
- Financial advisor headcount declined to 927 from 934 year-over-year
News Market Reaction 1 Alert
On the day this news was published, OPY declined 3.34%, reflecting a moderate negative market reaction.
Data tracked by StockTitan Argus on the day of publication.
Robert S. Lowenthal, President and CEO commented, "The Firm's improved operating results for the quarter showcase the strength of our businesses and the maturing of investments in experienced team members over the past several years. At the outset of the quarter, recession fears mounted as announced policies on trade drove significant market volatility and triggered a large selloff in the equity markets. As tariffs were suspended, the markets broadly rallied with both the NASDAQ and S&P 500 reaching new record highs to close out the quarter. Concerns remained over tariff-induced inflation, a potentially softening labor market and conflict in the
Rising markets proved quite favorable to our Wealth Management business revenue, with the rally driving assets under management ("AUM") to a fresh record, resulting in higher asset-based advisory fees when compared with the prior year period. Retail trading volumes, driven by investor interest, also remained robust, boosting commission revenue. However, the fees we earn on our FDIC sweep program are reduced from the prior year period due to lower deposit balances as clients sought higher returns in money market funds and other investments.
The Capital Markets businesses showed a substantial increase in total revenue. Institutional trading volumes were strong during the quarter due in part to increased volatility, which buoyed our sales and trading revenue. Investment Banking revenue also improved on the back of more advisory assignments that closed in the quarter and robust underwriting levels as capital markets re-opened. We are hopeful that higher deal volumes will continue in the latter half of the year as policymakers firm up key trade policy decisions and concerns around recession recede.
The Firm continues to maintain an unlevered balance sheet and ended the quarter with its capital reaching yet another all-time high. As we move into the second half of the year, we remain optimistic about our capabilities and our ability to continue delivering high quality services to our clients."
Summary Operating Results (Unaudited) | ||
('000s, except per share amounts or otherwise indicated) | ||
Firm | 2Q-25 | 2Q-24 |
Revenue | $ 373,178 | $ 330,589 |
Compensation Expenses | $ 239,074 | $ 220,727 |
Non-compensation Expenses | $ 101,894 | $ 93,997 |
Pre-Tax Income | $ 32,210 | $ 15,865 |
Income Tax Provision | $ 10,536 | $ 5,599 |
Net Income (1) | $ 21,674 | $ 10,266 |
Earnings Per Share (Basic) (1) | $ 2.06 | $ 0.99 |
Earnings Per Share (Diluted) (1) | $ 1.91 | $ 0.92 |
Book Value Per Share | $ 85.27 | $ 78.63 |
Tangible Book Value Per Share (2) | $ 68.25 | $ 61.56 |
Wealth Management | ||
Revenue | $ 246,421 | $ 234,526 |
Pre-Tax Income | $ 62,834 | $ 64,231 |
Assets Under Administration (billions) | $ 138.4 | $ 126.0 |
Assets Under Management (billions) | $ 52.8 | $ 47.5 |
Capital Markets | ||
Revenue | $ 122,981 | $ 92,141 |
Pre-Tax Loss | $ (3,864) | $ (21,775) |
(1) Attributable to Oppenheimer Holdings Inc. | ||
(2) Represents book value less goodwill and intangible assets divided by number of shares outstanding. |
Highlights
- Increased revenue for the second quarter of 2025 was primarily driven by significantly higher investment banking revenue due to an uptick in underwriting volumes and larger advisory mandates, an increase in transaction-based commissions and greater advisory fees attributable to a rise in billable AUM
- Rising markets lifted assets under administration and under management to fresh records at June 30, 2025
- Compensation expenses increased from the prior year quarter largely as the result of higher production and salary-related expenses
- Non-compensation expenses increased from the prior year quarter primarily due to higher technology related expenses and greater travel and other miscellaneous costs
- Total stockholders' equity, book value and tangible book value per share reached new record highs as a result of positive earnings
Wealth Management
Wealth Management reported revenue for the current quarter of
('000s, except otherwise indicated) | ||
2Q-25 | 2Q-24 | |
Revenue | $ 246,421 | $ 234,526 |
Commissions | $ 54,788 | $ 52,872 |
Advisory Fees | $ 125,610 | $ 117,187 |
Bank Deposit Sweep Income | $ 28,654 | $ 34,847 |
Interest | $ 21,943 | $ 21,626 |
Other | $ 15,426 | $ 7,994 |
Total Expenses | $ 183,587 | $ 170,295 |
Compensation | $ 132,291 | $ 123,538 |
Non-compensation | $ 51,296 | $ 46,757 |
Pre-Tax Income | $ 62,834 | $ 64,231 |
Compensation Ratio | 53.7 % | 52.7 % |
Non-compensation Ratio | 20.8 % | 19.9 % |
Pre-Tax Margin | 25.5 % | 27.4 % |
Assets Under Administration (billions) | $ 138.4 | $ 126.0 |
Assets Under Management (billions) | $ 52.8 | $ 47.5 |
Cash Sweep Balances (billions) | $ 2.8 | $ 2.9 |
Revenue:
- Retail commissions increased
3.6% from the prior year period primarily due to higher retail trading activity - Advisory fees increased
7.2% due to higher AUM during the billing period - Bank deposit sweep income decreased
$6.2 million - Interest revenue was flat compared to the prior year period
- Other revenue increased from a year ago primarily due to an increase in the cash surrender value of Company-owned life insurance policies, which fluctuates based on changes in the fair value of the policies' underlying investments
Assets under Management (AUM):
- AUM reached a record high of
$52.8 billion - The increase in AUM from the prior year period was comprised of higher asset values of
$8.9 billion $3.6 billion
Total Expenses:
- Compensation expenses increased
7.1% from the prior year period primarily due to higher production related expenses and higher deferred compensation costs, partially offset by lower expenses associated with share appreciation rights - Non-compensation expenses increased
9.7% from a year ago primarily due to an increase in interest and other miscellaneous expenses
Capital Markets
Capital Markets reported revenue for the current quarter of
('000s) | ||
2Q-25 | 2Q-24 | |
Revenue | $ 122,981 | $ 92,141 |
Investment Banking | $ 43,394 | $ 26,699 |
Advisory Fees | $ 22,487 | $ 12,290 |
Equities Underwriting | $ 12,225 | $ 11,208 |
Fixed Income Underwriting | $ 6,062 | $ 2,815 |
Other | $ 2,620 | $ 386 |
Sales and Trading | $ 78,904 | $ 64,766 |
Equities | $ 39,953 | $ 33,250 |
Fixed Income | $ 38,951 | $ 31,516 |
Other | $ 683 | $ 676 |
Total Expenses | $ 126,845 | $ 113,916 |
Compensation | $ 80,610 | $ 73,290 |
Non-compensation | $ 46,235 | $ 40,626 |
Pre-Tax Loss | $ (3,864) | $ (21,775) |
Compensation Ratio | 65.5 % | 79.5 % |
Non-compensation Ratio | 37.6 % | 44.1 % |
Pre-Tax Margin | (3.1) % | (23.6) % |
Revenue:
Investment Banking
- Advisory fees earned from investment banking activities increased
83.0% compared with the prior year period due to increased deal volumes and larger mandate sizes - Equities underwriting fees increased
9.1% compared with the prior year period primarily due to higher underwriting fees associated with larger deal sizes - Fixed income underwriting fees increased
115.3% compared with the prior year period primarily due to higher corporate and sovereign issuance activity levels
Sales and Trading
- Equities sales and trading revenue increased
20.2% compared with the prior year period mostly due to higher trading volumes and greater options-related commissions revenue - Fixed income sales and trading revenue increased
23.6% compared with a year ago largely due to higher trading volumes and interest income on trading inventory
Total Expenses:
- Compensation expenses increased
10.0% compared with the prior year period largely due to greater production-related expenses - Non-compensation expenses were
13.8% higher than a year ago primarily due to an increase in communication and technology expenses and travel-related costs
Other Matters
(In millions, except number of shares and per share amounts) | ||
2Q-25 | 2Q-24 | |
Capital | ||
Stockholders' Equity (1) | $ 896.9 | $ 812.1 |
Regulatory Net Capital (2) | $ 408.9 | $ 460.7 |
Regulatory Excess Net Capital (2) | $ 382.2 | $ 439.7 |
Common Stock Repurchases | ||
Repurchases | $ 0.6 | $ 0.9 |
Number of Shares | 9,855 | 23,102 |
Average Price | $ 58.89 | $ 40.01 |
Period End Shares | 10,517,924 | 10,327,510 |
Effective Tax Rate | 32.7 % | 35.3 % |
(1) Attributable to Oppenheimer Holdings Inc. | ||
(2) Attributable to Oppenheimer & Co. Inc. broker-dealer | ||
- The Board of Directors announced a quarterly dividend of
$0.18 - Compensation expense as a percentage of revenue was modestly lower at
64.1% during the current period versus66.8% during the same period last year - The effective tax rate for the current period was
32.7% compared with35.3% for the prior year period, as the impact of certain unfavorable permanent items and nondeductible foreign losses was reduced in the current period
Company Information
Oppenheimer Holdings Inc., through its operating subsidiaries, is a leading middle market investment bank and full service broker-dealer that is engaged in a broad range of activities in the financial services industry, including retail securities brokerage, institutional sales and trading, investment banking (corporate and public finance), equity and fixed income research, market-making, trust services, and investment advisory and asset management services. With roots tracing back to 1881, the Company is headquartered in
Forward-Looking Statements
This press release includes certain "forward-looking statements" relating to anticipated future performance. For a discussion of the factors that could cause future performance to be different than anticipated, reference is made to Factors Affecting "Forward-Looking Statements" and Part 1A – Risk Factors in the Company's Annual Report on Form 10-K for the year ended December 31, 2024.
Oppenheimer Holdings Inc. | ||||||||||||
Consolidated Income Statements (Unaudited) | ||||||||||||
('000s, except number of shares and per share amounts) | ||||||||||||
For the Three Months Ended June 30, | For the Six Months Ended June 30, | |||||||||||
2025 | 2024 | % Change | 2025 | 2024 | % Change | |||||||
REVENUE | ||||||||||||
Commissions | $ 110,025 | $ 97,055 | 13.4 | $ 220,903 | $ 192,905 | 14.5 | ||||||
Advisory fees | 125,628 | 117,197 | 7.2 | 254,431 | 232,044 | 9.6 | ||||||
Investment banking | 43,533 | 29,119 | 49.5 | 91,156 | 79,656 | 14.4 | ||||||
Bank deposit sweep income | 28,654 | 34,846 | (17.8) | 58,729 | 71,531 | (17.9) | ||||||
Interest | 38,017 | 34,805 | 9.2 | 74,386 | 61,571 | 20.8 | ||||||
Principal transactions, net | 14,532 | 10,074 | 44.3 | 23,507 | 28,308 | (17.0) | ||||||
Other | 12,789 | 7,493 | 70.7 | 17,891 | 17,712 | 1.0 | ||||||
Total revenue | 373,178 | 330,589 | 12.9 | 741,003 | 683,727 | 8.4 | ||||||
EXPENSES | ||||||||||||
Compensation and related expenses | 239,074 | 220,727 | 8.3 | 466,165 | 442,440 | 5.4 | ||||||
Communications and technology | 26,204 | 24,682 | 6.2 | 52,386 | 49,258 | 6.4 | ||||||
Occupancy and equipment costs | 15,578 | 15,516 | 0.4 | 31,587 | 31,364 | 0.7 | ||||||
Clearing and exchange fees | 7,041 | 6,780 | 3.8 | 14,793 | 12,622 | 17.2 | ||||||
Interest | 22,529 | 21,980 | 2.5 | 43,925 | 42,528 | 3.3 | ||||||
Other | 30,542 | 25,039 | 22.0 | 58,561 | 52,195 | 12.2 | ||||||
Total expenses | 340,968 | 314,724 | 8.3 | 667,417 | 630,407 | 5.9 | ||||||
Pre-Tax Income | 32,210 | 15,865 | 103.0 | 73,586 | 53,320 | 38.0 | ||||||
Income tax provision | 10,536 | 5,599 | 88.2 | 21,257 | 17,310 | 22.8 | ||||||
Net Income | $ 21,674 | $ 10,266 | 111.1 | $ 52,329 | $ 36,010 | 45.3 | ||||||
Less: Net loss attributable to non-controlling interest, net of tax | — | — | — | (310) | ||||||||
Net income attributable to Oppenheimer Holdings Inc. | $ 21,674 | $ 10,266 | 111.1 | $ 52,329 | $ 36,320 | 44.1 | ||||||
Earnings per share attributable to Oppenheimer Holdings Inc. | ||||||||||||
Basic | $ 2.06 | $ 0.99 | 108.1 | $ 4.99 | $ 3.49 | 43.0 | ||||||
Diluted | $ 1.91 | $ 0.92 | 107.6 | $ 4.63 | $ 3.29 | 40.7 | ||||||
Weighted average number of common shares outstanding | ||||||||||||
Basic | 10,520,219 | 10,327,818 | 1.9 | 10,493,145 | 10,367,636 | 1.2 | ||||||
Diluted | 11,349,049 | 11,111,903 | 2.1 | 11,308,979 | 11,083,422 | 2.0 | ||||||
Period end number of common shares outstanding | 10,517,924 | 10,327,510 | 1.8 | 10,517,924 | 10,327,510 | 1.8 | ||||||
View original content:https://www.prnewswire.com/news-releases/oppenheimer-holdings-inc-reports-second-quarter-2025-earnings-302519080.html
SOURCE Oppenheimer Holdings Inc.
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