Lazard Inc. (NYSE: LAZ) reported its second-quarter results on Thursday. Earnings fell short of analyst expectations, although revenue exceeded forecasts.
Shares declined 6.77% in pre-market trading after the announcement.
Adjusted earnings fall well below expectations
The financial advisory and asset management firm reported adjusted earnings of $0.12 per share.
That result was well below the analyst consensus of $0.36 per share.
Revenue reached $808 million, exceeding the $745 million estimate. It also increased 1% from $796 million a year earlier.
On an adjusted basis, net revenue rose to $786 million. The company reported $770 million in the same period last year.
Asset Management supports quarterly performance
The earnings miss came despite strong performance from Asset Management.
The segment generated adjusted net revenue of $331 million. That represented a 23% year-over-year increase.
Financial Advisory moved in the opposite direction. Adjusted net revenue declined 9% year over year to $445 million.
Higher expense ratios weigh on profitability
Lazard’s adjusted compensation ratio rose to 69.9%. It stood at 65.5% in the same quarter last year.
The adjusted non-compensation ratio also increased. It climbed from 20.4% to 21.8%.
“Lazard continues to progress toward our 2030 objectives,” said Peter R. Orszag, CEO and Chairman.
He added that underlying trends continue to support confidence in the company’s long-term growth strategy.
“In Asset Management, we delivered our best first-half net inflows in nearly 20 years,” Orszag said.
The segment also reached a record level of reported assets under management.
Elevated tax rate affects quarterly earnings
Lazard reported an adjusted effective tax rate of 69.7%.
The unusually high rate had a significant effect on the company’s quarterly results.
CFO Tracy Farr said the elevated rate was not indicative of the expected full-year tax rate.
Assets under management reach a record $285 billion
Assets under management reached a record $285 billion as of June 30, 2026.
That figure was 15% higher than the $248 billion reported one year earlier.
For the first half of 2026, Lazard reported adjusted earnings of $0.54 per share.
Adjusted net revenue for the six-month period reached $1.46 billion.
The results highlight a clear contrast across Lazard’s operations. Asset Management continued to grow, while short-term profitability remained under pressure.
