Houlihan Lokey Reports Second Quarter Fiscal 2027 Financial Results
HOULIHAN LOKEY, INC. (HLI) filed an SEC Form 8-K — Results of Operations and Financial Condition. Houlihan Lokey Reports Second Quarter Fiscal 2027 Financial Results – Second Quarter Fiscal 2027 Revenues of $692 million – – Second Quarter Fiscal 2027 Diluted EPS of $1.64 – – Adjusted Second Quarter Fiscal 2027 Diluted EPS of $1.85 – – Announces Dividend of $0.70 per Share for
How this was made
The 30-second read
Why it matters
The earnings beat and dividend announcement provide fresh data for traders to position ahead of market open.
Market read
First‑report earnings release with material numbers; likely to move the stock in pre‑market trading.
What to watch
Decline in financial restructuring revenue and higher tax rate could pressure margins.
Second Quarter Fiscal 2027 Revenues of $692 million; Diluted EPS of $1.64; Adjusted Diluted EPS of $1.85
Second-quarter revenue increased to $692 million, led by Corporate Finance and Financial and Valuation Advisory, but GAAP and adjusted net income attributable to Houlihan Lokey, Inc. were below the prior-year quarter and Financial Restructuring revenue declined.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| Revenue, three months ended September 30GAAP | $692M | – | – |
| Operating income, three months ended September 30GAAP | $154M | – | – |
| Net income, three months ended September 30GAAP | $110M | – | – |
| Net income attributable to Houlihan Lokey, Inc., three months ended September 30GAAP | $109M | – | – |
| Diluted earnings per share attributable to Houlihan Lokey, Inc., three months ended September 30GAAP | $1.64 | – | – |
| Basic earnings per share, three months ended September 30GAAP | $1.64 | – | – |
| Compensation expenses, three months ended September 30GAAP | $441M | – | – |
| Compensation ratio, three months ended September 30GAAP | 63.7% | – | – |
| Non-compensation expenses, three months ended September 30GAAP | $97M | – | – |
| Non-compensation expenses as a percentage of revenues, three months ended September 30GAAP | 14.0% | – | – |
| Provision for income taxes, three months ended September 30GAAP | $49M | – | – |
| Effective tax rate, three months ended September 30GAAP | 30.6% | – | – |
| Operating income, three months ended September 30non-GAAP | $175M | – | – |
| Net income attributable to Houlihan Lokey, Inc., three months ended September 30non-GAAP | $124M | – | – |
| Diluted EPS, three months ended September 30non-GAAP | $1.85 | – | – |
| Adjusted compensation expenses, three months ended September 30non-GAAP | $426M | – | – |
| Adjusted compensation ratio, three months ended September 30non-GAAP | 61.5% | – | – |
| Adjusted non-compensation expenses, three months ended September 30non-GAAP | $91M | – | – |
| Adjusted non-compensation expenses as a percentage of revenues, three months ended September 30non-GAAP | 13.3% | – | – |
| Adjusted effective tax rate, three months ended September 30non-GAAP | 30.0% | – | – |
| Revenue, six months ended September 30GAAP | $1.20B | – | – |
| Operating income, six months ended September 30GAAP | $232M | – | – |
| Net income attributable to Houlihan Lokey, Inc., six months ended September 30GAAP | $187M | – | – |
| Diluted earnings per share attributable to Houlihan Lokey, Inc., six months ended September 30GAAP | $2.78 | – | – |
| Operating income, six months ended September 30non-GAAP | $272M | – | – |
| Net income attributable to Houlihan Lokey, Inc., six months ended September 30non-GAAP | $215M | – | – |
| Diluted EPS, six months ended September 30non-GAAP | $3.20 | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Corporate Finance, three months ended September 30Revenue increased due to an increase in the average transaction fee on closed transactions, driven by transaction mix and improved market conditions for M&A and capital markets transactions. The increase was partially offset by a decline in the number of closed transactions. | $481M | – | 10% |
| Financial Restructuring, three months ended September 30Revenue decreased primarily due to a decrease in the number of closed transactions, driven by timing of transaction closings. This was partially offset by an increase in the average transaction fee on closed transactions, driven by transaction mix. | $118M | – | decreased (12)% |
| Financial and Valuation Advisory, three months ended September 30Revenue increased due to growth in non-cyclical businesses. | $93M | – | 7% |
| Corporate Finance, six months ended September 30Number of Managing Directors was 267 and number of closed transactions was 269. | $784M | – | – |
| Financial Restructuring, six months ended September 30Number of Managing Directors was 57 and number of closed transactions was 50. | $237M | – | – |
| Financial and Valuation Advisory, six months ended September 30Number of Managing Directors was 46 and number of Fee Events was 1,554. | $182M | – | – |
Capital returns
- The Board of Directors declared a regular quarterly cash dividend of $0.70 per share of Class A and Class B common stock.
- The dividend will be payable on December 15, 2026 to stockholders of record as of the close of business on December 1, 2026.
- During the second quarter ended September 30, 2026, the Company repurchased 397 thousand shares as part of its share repurchase program.
What drove it
- Corporate Finance revenue was supported by higher average transaction fees, transaction mix, and improved market conditions for M&A and capital markets transactions.
- Financial and Valuation Advisory revenue growth was driven by non-cyclical businesses.
- GAAP and adjusted compensation expenses increased primarily as a result of the increase in quarterly revenue.
- GAAP and adjusted non-compensation expenses increased primarily due to higher rent expense and other operating expenses.
Concerns
- Financial Restructuring revenue decreased due primarily to fewer closed transactions resulting from the timing of transaction closings.
- Corporate Finance closed transactions were 142, compared with 171 in the prior-year quarter, although the Company stated it believes the decline does not represent a trend.
- GAAP net income attributable to Houlihan Lokey, Inc. was $109 million, compared with $111 million in the prior-year quarter.
- Adjusted net income attributable to Houlihan Lokey, Inc. was $124 million, compared with $127 million in the prior-year quarter.
- The effective tax rate was 30.6%, compared with 30.2% in the prior-year quarter.
What to watch
- Corporate Finance transaction volume and whether the decline in closed transactions persists.
- Financial Restructuring transaction closings following the timing-driven decrease in the quarter.
- The balance between higher revenue and compensation, rent, and other operating expenses.
- Management's expectation of solid performance across its businesses for the remainder of the year, while remaining cautious due to volatility of external factors.
Balance sheet and cash flow
- Cash and cash equivalents were $837 million as of September 30, 2026, compared with $1,189 million as of March 31, 2026.
- Investment securities were $51 million as of September 30, 2026, compared with $170 million as of March 31, 2026.
- Cash and cash equivalents and investment securities were $888 million as of September 30, 2026.
- Accounts receivable, net of allowance for credit losses, were $285 million as of September 30, 2026, compared with $228 million as of March 31, 2026.
- Unbilled work in progress, net of allowance for credit losses, was $267 million as of September 30, 2026, compared with $271 million as of March 31, 2026.
- Total assets were $3,975 million as of September 30, 2026, compared with $4,309 million as of March 31, 2026.
- Total liabilities were $1,557 million as of September 30, 2026, compared with $1,856 million as of March 31, 2026.
- Total stockholders’ equity was $2,307 million as of September 30, 2026, compared with $2,342 million as of March 31, 2026.
Analysis
Houlihan Lokey reported second-quarter fiscal 2027 revenue of $692 million, compared with $660 million in the prior-year quarter. Corporate Finance generated $481 million of revenue and Financial and Valuation Advisory generated $93 million, while Financial Restructuring generated $118 million. The release attributed Corporate Finance growth to higher average transaction fees, transaction mix, and improved M&A and capital markets conditions. Financial and Valuation Advisory growth came from non-cyclical businesses.
The revenue mix was uneven. Corporate Finance revenue increased 10%, despite closed transactions declining to 142 from 171. Financial Restructuring revenue decreased (12)% as closed transactions fell to 27 from 37, which the Company attributed primarily to the timing of transaction closings. Financial and Valuation Advisory revenue increased 7%, while Fee Events were 1,071 compared with 1,075.
GAAP operating income was $154 million, compared with $151 million, but net income attributable to Houlihan Lokey, Inc. was $109 million, compared with $111 million. GAAP diluted EPS was $1.64, compared with $1.63. Adjusted operating income was $175 million, compared with $171 million, while adjusted net income attributable to Houlihan Lokey, Inc. was $124 million, compared with $127 million and adjusted diluted EPS was $1.85, compared with $1.84. Compensation expenses were $441 million and the compensation ratio was 63.7%, compared with $423 million and 64.2%.
For the six months ended September 30, revenue was $1,203 million, compared with $1,265 million, and GAAP net income attributable to Houlihan Lokey, Inc. was $187 million, compared with $209 million. The balance sheet reported $888 million of cash and cash equivalents and investment securities as of September 30, 2026. The Company repurchased 397 thousand shares during the quarter and declared a regular quarterly cash dividend of $0.70 per share.
The Company did not provide numerical financial guidance. Scott Adelson said the Company expects solid performance across its businesses for the remainder of the year, while remaining cautious due to volatility of external factors. The central reported issues for subsequent periods are whether Corporate Finance transaction activity improves, whether Financial Restructuring closings normalize, and whether higher compensation and non-compensation expenses remain aligned with revenue development.
Management, verbatim
Improving market conditions resulted in a stronger second quarter. While we remain cautious due to the volatility of external factors, we expect to see solid performance across our businesses for the remainder of the year.
Scott Adelson, Chief Executive Officer
Not in the filing
stated, not guessed- Numerical forward revenue guidance
- Numerical forward gross-margin guidance
- Numerical forward operating-expense guidance
- Numerical forward tax-rate guidance
- Prior-period outlook for comparison
- Gross profit and gross margin
- Operating cash flow
- Free cash flow
- Debt balances
- Net debt
- Prior-quarter comparisons for reported income-statement metrics
- Explicit year-over-year percentage changes for total revenue, operating income, net income, and EPS
AlphAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
The filing is an SEC Form 8‑K Item 2.02, the first public disclosure of Houlihan Lokey's Q2 FY2027 financials.
Ticker impact
Houlihan Lokey reported Q2 FY2027 results: revenue $692M (+5%), EPS $1.64, adjusted EPS $1.85, and declared a $0.70 dividend.
likely modest upside as market prices in revenue beat and dividend increase
Revenue grew versus prior year and a dividend was announced, which typically supports the stock price in the short term.
Market effects
Positive signal for investment banking and advisory services sector.
U.S. financial services market may see slight uplift.
Limited to firms with similar advisory business models.
Counterpoint
Revenue growth may be offset by higher compensation expenses, limiting upside.
Key entities
- CompanyHoulihan Lokey, Inc.
U.S. investment bank and financial advisory firm.
