Houlihan Lokey's Q3 2025: Contradictions in M&A Activity, Corporate Finance Growth, and Restructuring Prospects

These are the key contradictions discussed in Houlihan Lokey's latest 2025 Q3 earnings call, specifically including: Transaction Velocity and M&A Activity, Corporate Finance growth trajectory, Private Capital Solutions expansion, and Restructuring Market Expectations:



Revenue and Earnings Growth:
- Houlihan Lokey reported revenues of $634 million for Q3 FY 2025, up 24% from the same period last year, and adjusted earnings per share of $1.64, up 34%.
- This growth was driven by improvements in M&A and financing markets, favorable macroeconomic conditions, and strong performance in Corporate Finance and Financial Valuation Advisory.

Corporate Finance Performance:
- Corporate Finance revenue increased to $422 million for Q3, representing a 36% increase over the same period last year.
- This growth was attributed to improvements in key metrics like close rates, time-to-close transactions, and new business generation, as well as increased deal activity across geographies and industries.

Financial Restructuring Stability:
- Financial Restructuring revenue was $131 million for Q3, a 2% increase over the same period last year.
- The stability in this sector was supported by record leverage and persistently higher interest rates, providing sustained demand for restructuring services.

Acquisitions and Market Expansion:
- Houlihan Lokey completed the acquisition of Waller Helms, adding 17 new managing directors, contributing to its Q3 results.
- The company is optimistic about future acquisitions, even in a slow and steady M&A environment, due to its diversified market presence and strategic focus on mid-cap clients.