Fortune 500 investment bank Jefferies Financial Group reported a stellar 2024 performance, starting the new year in what executives called “the best position ever in [the] firm’s 62-year history.”
The company saw its net revenues surge to $7.03 billion for the year, with fourth-quarter revenues hitting $1.96 billion—a 63% jump from the same period last year. Its profit in the fourth quarter more than tripled. In response to the strong performance, Jefferies increased its quarterly dividend by 14.3% to $0.40 per share.
“The cherry on top may be that the financial stars are aligning,” company leadership wrote in a letter to shareholders. After a year that started with stubborn inflation and a looming recession, Jefferies says it’s in a stronger position than expected.
The firm’s success was driven by significant gains across all major business lines, with investment banking revenues up 52% to $3.44 billion and capital markets revenues rising 24% to $2.76 billion. CEO Richard Handler and President Brian Friedman attributed the growth to market share gains and improved market conditions, positioning Jefferies as the world’s 6th largest investment bank. Notable deals included advising on Diamondback Energy’s $26 billion merger with Endeavour Energy and SRS Distribution’s $18 billion sale to The Home Depot.
Read the press release below and see the full shareholder letter for a deeper dive.
Management comments:
Our fourth quarter net revenues of $1.96 billion, pre-tax earnings from continuing operations of $305 million and diluted earnings per share from continuing operations of $0.91 are 63%, 249% and 214%, higher than the prior year quarter, respectively. Our quarterly results reflect strong performance in Investment Banking (up 73%), including a record quarter in Advisory (up 97%), as well as another robust quarter for Equities (up 49%) and solid performance in Fixed income (up 15%). Asset Management fee and investment return net revenues of $116 million were substantially higher than the prior year quarter, reflecting fee growth and strong overall performance from a number of strategies.
Our 2024 net revenues of $7.03 billion, pre-tax earnings from continuing operations of $7.01 billion and diluted earnings per share from continuing operations of $2.96 are 50%, 184% and 169% higher than the prior year, respectively. Our annual results reflect continued strength and sustained momentum across all lines of business, primarily attributable to market share gains and a stronger overall market for our services.
We are laser focused on our core mission of building and being the best full-service global investment banking and capital markets firm and we are very excited about our progress. More normalized market conditions and the maturation of our platform are beginning to show our earnings potential, as our core businesses have generated meaningfully improved underlying operating margins. Our non-compensation expense ratio improved from 39% in 2023 to 34% in 2024, as our revenue growth outpaced expense growth. We are optimistic about our ability to continue to further expand operating margins as we continue to grow our core businesses. The consolidation of Stratos and Tessellis caused meaningfully higher gross revenues and expenses to be recorded in Other Investments in our Asset Management segment for the fourth quarter and the full year, however, Other investments had a nominal impact on earnings.
Our 2024 Investment Banking net revenues of $3.44 billion were up 52% from the prior year, reflecting our second highest annual results on record, as well as record market share across many of our key products, sectors and regions. Following a period of significant investment in our business, today we provide our clients with an exceptional offering of full-service capabilities that extend to the largest and most complex transactions and underwritings, best-in-class talent, true local reach and access across every major market. Critically, these capabilities are underpinned by a culture of service, urgency and creative problem solving.
Capital Markets net revenues of $2.76 billion for 2024 were up 24% versus the prior year, driven by solid overall market conditions and strength across most of our business lines. Equities net revenues increased 40% from the prior year, with strong performance in our cash and electronic businesses. We continue to invest across our electronic trading, equity finance and equity derivative platforms to deliver effective liquidity and execution globally to our clients. Fixed Income net revenues increased 7% from the prior year, driven by robust client demand and particular strength in our distressed trading and securitization businesses, partially offset by less favorable results in our global structured solutions business. The growth of our Fixed Income franchise is the result of the consistency of our strategy, which focuses on long-term client partnerships and a commitment to fundamental credit analysis, leading to an idea-driven, solutions-oriented approach.
Our 2024 Asset Management fee and investment return revenues of $316 million were up 27% from the prior year, reflecting fee growth and strong overall performance from a number of our strategies. We are pleased with this performance, considering the unique challenges the business faced during the year from Weiss Multi-Strategy Advisors and 352 Capital. Other investments had 2024 net revenues of $550 million largely due to the consolidation of Stratos and Tessellis causing the inclusion of significant gross revenues and expenses.
Jefferies begins 2025 in the best position ever in our firm’s 62-year history. We believe our team is incredibly talented and special, and they are driving our momentum forward. Our clients are rewarding us with broad global growth and an enhanced market position in almost everything Jefferies offers. After decades of hard work, we are in the front row of the pack of competitors serving clients across all sectors and regions in investment banking and capital markets. We believe we have developed to where we are today because of our unique culture of collaboration and integrity. By emphasizing a sense of long-term ownership, entrepreneurship and purpose, we have been able to achieve our ever-better market position, and we will do everything in our power to preserve and enhance it as we continue our journey.
— Richard Handler, CEO, and Brian Friedman, President
Please refer to the just-released Jefferies Financial Group Annual Letter from our CEO and President for broader perspective on 2024, as well as our strategy and outlook.