Jefferies beats revenue expectations with 27% growth in Q1 2026
Jefferies Financial Group (JEF) has reported a strong fiscal first quarter, with revenue surpassing Wall Street expectations. The company's investment banking division led the growth, driven by a sharp rise in equity underwriting and solid advisory fees.
The firm also announced an expanded share repurchase programme, raising its authorisation to $250 million after buying back $174 million in shares during the quarter. For the quarter ending 31 January 2026, Jefferies posted net revenue of $2.02 billion—a 27% increase from $1.59 billion in the same period last year. Investment banking revenue reached $1.02 billion, with equity underwriting soaring 138% to $306 million. Debt underwriting, however, fell 8.8% to $182 million.
Earnings per share (EPS) from continuing operations came in at $0.70, up from $0.57 a year earlier but below the $0.91 consensus estimate. Despite this, the company's stock edged up 0.6% in after-hours trading on Wednesday.
Jefferies also recorded a $36 million non-cash writedown of goodwill tied to the sale of Tessellis, its last remaining merchant banking asset. The sale, announced in 2024, is set to close in early 2027, allowing the firm to fully exit its merchant banking operations. An additional $17 million in losses were linked to Market Financial Solutions and First Brands, though Jefferies confirmed it has no direct exposure to the collapsed auto parts firm.
Asset management fees and investment returns jumped 91% to $159 million compared with the prior-year quarter. Management highlighted that core businesses delivered record first-quarter revenues over the past six months, even as the company continues winding down its merchant banking portfolio. Jefferies' Q1 results reflect strong performance in its core investment banking and asset management divisions. The company's expanded share buyback plan and progress in exiting merchant banking signal a focus on streamlining operations.
With revenue growth and a rise in after-hours trading, the firm appears positioned for further financial adjustments in the coming quarters.
