Moelis & Company NYSE: MC reported record second-quarter and first-half revenue for 2026, citing higher average fees per completed transaction and growing contributions from its capital markets and private capital advisory businesses.
Second-quarter revenue totaled $409 million, up 12% from a year earlier, while first-half revenue reached $729 million, an increase of 9%. Chief Executive Officer and Co-Founder Navid Mahmoodzadegan said the firm entered the second half with a record total pipeline, including an announced pipeline that was more than 80% higher than at the same point a year earlier.
“Client engagement and transaction activity has remained strong,” Mahmoodzadegan said, despite market volatility related to the Middle East war, concerns around private-credit redemptions, and the evolving effects of artificial intelligence.
M&A Activity and Pipeline
Mahmoodzadegan said improving financing availability, strong equity-market performance, demand for greater scale, and what he described as a more constructive regulatory environment have supported M&A activity. The firm has seen increased opportunities involving larger-capitalization clients and higher average fee opportunities.
He said industry activity has been concentrated in transactions valued above $5 billion, though Moelis observed an increase during the second quarter in deals valued between $1 billion and $5 billion. Mahmoodzadegan said that trend could signal a broader expansion of the M&A market into the middle market.
Among transactions cited during the quarter, Moelis advised on:
- Taylor Morrison’s $8.5 billion sale to Berkshire Hathaway;
- Magnolia Oil & Gas’ $4.1 billion acquisition of WildFire Energy;
- AtaiBeckley’s $3.8 billion sale to Eli Lilly; and
- Bridgepoint’s acquisition of Kayne Anderson Real Estate.
The firm also advised Office Properties Income Trust on its $2.4 billion restructuring, Carlyle on a continuation vehicle for Content Partners, and served as active bookrunner and lead placement agent for Doncasters’ $1.1 billion initial public offering and concurrent private placement.
Mahmoodzadegan characterized the current point in the M&A cycle as “early innings,” pointing to technology disruption, companies’ need for scale, sponsor portfolio assets awaiting exits, and the regulatory backdrop as factors that could support activity over time. He cautioned that transaction volumes could still experience periodic fluctuations.
Capital Markets and Private Capital Advisory Growth
Capital markets and private capital advisory were the primary sources of growth during the first half, partially offsetting declines in capital structure advisory revenue. For the first half, Moelis’ revenue mix was approximately two-thirds M&A and one-third non-M&A.
The capital markets business generated record second-quarter and first-half revenue, supported by demand for late-stage growth and pre-IPO financings, IPO activity, and demand for hybrid and structured financing solutions. The firm expects additional IPO activity later in the year.
Moelis has added senior talent to broaden the platform, including a managing director with debt capital markets and private-credit expertise and another who will help establish securitization capabilities. Mahmoodzadegan said the securitization effort will expand the firm’s structured-products offering and asset-backed financing capabilities.
Private capital advisory was also a meaningful contributor to first-half growth. Moelis has expanded its GP-led secondaries team to seven dedicated managing directors, including one expected to join shortly. The firm also hired managing directors to launch LP-led secondaries and promoted co-investment capabilities.
Mahmoodzadegan said GP-led continuation vehicles have ramped relatively quickly because of the firm’s sponsor relationships and collaboration between sector bankers and private capital advisory teams. He said the firm expects the business to achieve revenue per managing director generally in line with the broader firm over time, although some areas, such as primary fundraising, may take longer to develop.
Margins, Expenses and Capital Returns
Chief Financial Officer Chris Callesano said Moelis’ adjusted compensation ratio was 65.8% in both the second quarter and first half, compared with 69% in the comparable 2025 periods. The company expects to continue improving the compensation ratio during 2026, with the pace dependent on revenue, senior hiring and the market for talent.
Adjusted non-compensation expenses were $66.5 million during the second quarter, equal to 16.2% of revenue. First-half adjusted non-compensation expenses were $134 million, or 18.3% of revenue. The expense increase reflected higher transaction-related travel and entertainment, client conference costs, underwriting syndication costs tied to expanding public equity capital markets activity, technology and data investments including AI, and higher occupancy costs.
Callesano said quarterly non-compensation expenses are expected to run in the mid- to high-$60 million range for the remainder of the year. He added that, excluding distinct transaction-related underwriting syndication costs, non-compensation expense growth would have tracked the company’s original forecast.
Adjusted pre-tax margin improved to 18.6% in the second quarter from 17.6% a year earlier, and to 17% in the first half from 16%. The company’s second-quarter effective tax rate was 29.1%.
The board declared a quarterly dividend of $0.65 per share, unchanged from the prior quarter. Moelis repurchased approximately 337,000 shares in the second quarter at an average price of $64.43 per share. During the first half, it repurchased about 2.3 million shares through open-market repurchases and net share settlements at a total cost of about $141 million.
Including the declared dividend, the company said it returned approximately $246 million of capital to shareholders in the first half. It ended the quarter with $481 million in cash and no debt.
Talent Investment and AI Adoption
Moelis hired four managing directors since its prior earnings call, bringing year-to-date lateral managing director hires to 12. The company also promoted 13 managing directors internally at the beginning of the year. The recent hires included bankers focused on private capital advisory, capital structure advisory, and European infrastructure.
Mahmoodzadegan said competition for senior bankers remains intense, but the firm is focused on recruiting and retaining talent that fits its collaborative culture. Of the 12 lateral managing director hires this year, he said about five were sector bankers and seven were product bankers spanning M&A, private capital advisory and capital markets.
On AI, management said the company is testing and deploying tools across its workflows, with the goal of improving productivity and client service. Callesano said many of the firm’s AI tools are currently under fixed contracts without variable costs for higher usage through part of next year.
Mahmoodzadegan said Moelis is also focused on safeguarding client information and proprietary data as AI adoption expands. While he expects some AI tools to become broadly available across the industry, he said the firm believes effective adoption can help bankers generate ideas, improve advice and operate more efficiently.
About Moelis & Company (NYSE:MC)
Moelis & Co operates as a holding company. It engages in the provision of financial advisory, capital raising and asset management services to a client base including corporations, governments, sovereign wealth funds and financial sponsors. The firm focuses on clients including large public multinational corporations, middle market private companies, financial sponsors, entrepreneurs and governments. The company was founded by Kenneth David Moelis, Navid Mahmoodzadegan, Jeffrey Raich and Elizabeth Ann Crain in July 2007 and is headquartered in New York, NY.
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