PJT Partners Q2 Revenue Jumps 13 Percent

Key Points

• - Record GAAP revenue of $406.9 million for Q2 2025, up 13% from the prior year for the quarter ended June 30, 2025, beat analyst expectations by 4.3 %.

• - Adjusted earnings per share reached $1.54 for Q2 2025, exceeding estimates by 7.7 % and up 29% from the prior year for the quarter ended June 30, 2025.

• - Strategic advisory fees comprised 87% of total revenue for the quarter ended June 30, 2025.

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PJT Partners (NYSE:PJT), a global investment bank specializing in strategic advisory and restructuring, posted record results for the quarter ended June 30, 2025. In its earnings release on July 29, 2025, the company reported $406.9 million in revenue, above the $390.2 million GAAP consensus forecast. Adjusted earnings per share (EPS) rose to $1.54, beating analyst estimates of $1.43. Strategic advisory drove the top line, counterbalancing a decline in placement fees and a rise in expenses. The period stands out for new highs in both pretax profit and adjusted EPS (non-GAAP), sustained by momentum in major business segments, yet with continued cost pressures and a market environment that remains cyclical.

Source: Analyst estimates for the quarter provided by FactSet.

Overview of PJT Partners’ Business and Focus Areas

PJT Partners (NYSE:PJT) delivers independent advice to corporations, institutional investors, and governments, focusing on strategic advisory for mergers and acquisitions, financial restructurings, capital raising, and related services. As a firm structured around talent and expertise, its operations hinge on deep client relationships and long-term advisory mandates.

The company's major business lines include strategic advisory, which involves providing expert guidance for mergers and acquisitions (M&A), and restructuring and special situations, which assist companies in navigating financial distress or reorganization. Key areas for the business are its ability to win high-profile mandates, retain and attract top talent, and maintain a strong global presence. Its regulatory compliance efforts and adaptability in shifting market environments also underpin ongoing success.

Quarter Highlights: Financial Performance and Key Business Drivers

Record GAAP revenue surpassed analyst consensus by 4.3 %, with the adjusted EPS level also setting a new high. Strategic advisory fees (GAAP) contributed $354.5 million, up 15% compared to the prior year and Advisory fees accounted for approximately 87% of total revenue in the quarter ended June 30, 2025. This upward movement offset an 8% decline in placement fees, which management attributed to a decrease in fund placement revenues.

The increase in strategic advisory revenue was principally driven by higher activity in major transactions. The company’s strong presence on major transactions continues to support its top-line momentum. PJT’s restructuring business, covering distressed M&A and Chapter 11-type reorganizations, benefited from a multi-year period of elevated liability management activity. Leadership noted there are no current capacity constraints in this segment, pointing to a further upside if economic challenges persist.

Operating costs climbed during the quarter. Compensation and benefits expenses (GAAP) rose to $276.8 million, but the GAAP compensation ratio improved to 68.0%, down from 69.5 % the prior year, signaling more efficient use of compensation costs as revenue has scaled up. Non-compensation expenses, including occupancy and travel, increased in part due to expanded offices in London and New York.

Pretax income saw year-over-year improvement on both a GAAP and adjusted basis, while the adjusted pretax margin reached 19.7% (non-GAAP), compared to 18.2 % in the same period last year. The company maintained a $0.25 per share dividend, unchanged from prior quarters. On capital returns, PJT repurchased 642,000 shares and 2.1 million shares in the first six months of the year, with $87 million remaining in its repurchase authorization as of June 30, 2025.

Business Context, Recent Priorities, and Product Highlights

Strategic advisory is the foundation of PJT's business. These services involve consulting on mergers, acquisitions, corporate break-ups, and shareholder activism. The company’s record advisory fee performance aligns with an ongoing rebound in global M&A, while its ability to advise on complex, high-value transactions supports both revenue and reputation. Notably, prior deals involving industry leaders raised PJT’s profile and pipeline.

Restructuring and special situations, PJT’s second core service, come to the forefront when macroeconomic uncertainty and higher default rates drive demand for liability management. The firm remains in a period of elevated restructuring activity, with management expecting full-year levels to be consistent with last year's record, and the potential for an increase if economic stress persists. This business remains a key growth vector, and PJT maintains significant expertise and capacity here.

Talent management is central to the business. The firm continues to invest in partner-level hiring, positioning itself as a destination for top advisory professionals. Although the overall compensation ratio remains structurally high at 68.0% (GAAP), there was incremental leverage achieved as revenue outpaced expense growth. Retaining top bankers is vital; the firm’s share repurchase effort reflects its commitment to shareholder alignment and managing dilution.

Global expansion, particularly in key financial centers, has driven higher operating costs but also provides access to major cross-border advisory opportunities. The company increased investments in both its London and New York offices this quarter. Despite these investments, cost discipline is reflected in the improvement of the adjusted pretax margin.

Looking Ahead: Guidance and Focus Areas

Management did not provide explicit numeric guidance for the third quarter or full fiscal 2025 in this earnings release. However, commentary in prior calls pointed to expectations for strong strategic advisory growth and steady results in restructuring, with continued high activity levels expected across both business lines.

For investors, ongoing points to monitor include trends in strategic advisory deal volume, any further shifts in restructuring demand, and the impact of expense growth on operating margins. The company’s heavy reliance on advisory fees and limited diversification remain worth watching, as does its approach to capital allocation through buybacks and dividends. The quarterly dividend was held steady at $0.25 per share.

Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.

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JesterAI is a Foolish AI, based on a variety of Large Language Models (LLMs) and proprietary Motley Fool systems. All articles published by JesterAI are reviewed by our editorial team, and The Motley Fool takes ultimate responsibility for the content of this article. JesterAI cannot own stocks and so it has no positions in any stocks mentioned. The Motley Fool has positions in and recommends PJT Partners. The Motley Fool has a disclosure policy.