Stifel Financial Corp. Reports 7.9% Revenue Growth but 71.7% Decline in Net Income for Q1 2025

Stifel Financial Corp. reported its financial results for the first quarter of 2025, revealing a net revenue increase of 7.9% to $1.3 billion, compared to $1.2 billion in the same period of 2024. However, net income available to common shareholders saw a significant decline of 71.7%, dropping to $43.7 million, or $0.39 per diluted share, from $154.3 million, or $1.40 per diluted share, in the prior year. This decrease was largely attributed to elevated provisions for legal matters stemming from a recent arbitration ruling. The company's total assets rose to $40.4 billion, a 1.2% increase from $39.9 billion at the end of 2024.

The company's revenue growth was driven by higher asset management revenues, investment banking revenues, and transactional revenues. Commissions increased by 4.4% to $193.7 million, while investment banking revenues rose by 11.2% to $237.9 million. Asset management revenues also saw an 11.4% increase, reaching a record $409.5 million. Interest income, however, decreased by 6.2% to $475.6 million, primarily due to lower interest rates, despite an increase in interest-earning assets.

Stifel's non-interest expenses surged by 26.2% to $1.2 billion, with compensation and benefits expenses rising by 7.7% to $732.2 million. The increase in expenses was driven by higher variable compensation and significant legal-related costs, which amounted to $180 million in the first quarter. The provision for credit losses also saw a notable increase of 128.2%, reflecting the company's response to loan growth and changing macroeconomic conditions.

In terms of operational metrics, Stifel's client assets reached $485.9 billion, a 3.9% increase from the previous year, with fee-based client assets growing by 7.1%. The number of financial advisors decreased slightly to 2,340 from 2,356, while the company continued to focus on recruiting experienced advisors to enhance its client relationships. The company also announced the completion of the acquisition of a portion of B. Riley Financial's wealth management business, which added 36 advisors and approximately $4 billion in assets under management.

Looking ahead, Stifel Financial Corp. remains focused on revenue growth and expanding its market share through strategic acquisitions and recruitment efforts. The company is navigating a challenging economic environment, with ongoing attention to managing legal risks and maintaining compliance with regulatory capital requirements. The outlook for the remainder of 2025 will depend on market conditions, client activity, and the successful integration of recent acquisitions.