US ▾
MRMRSH

Marsh & McLennan Companies (MRSH) Q3 FY26 earnings call: guidance and Q&A

Earnings call· Sep 2026 (Q3 FY26)· Oct 15, 2026

Source: earnings call transcript

Executive summary

Marsh & McLennan Companies, Inc. Q3 FY26 — Strong Growth and Increased Thrive Savings Target

Marsh & McLennan delivered a strong third quarter, marked by robust underlying revenue growth across its Risk & Insurance Services and Consulting segments, alongside double-digit adjusted EPS growth. The company is actively leveraging AI to enhance client services and internal efficiencies, leading to an increased savings target for its Thrive program. Despite market headwinds in reinsurance and commercial insurance pricing, the firm remains focused on strategic investments and disciplined capital deployment to drive future growth and client value.

Highlights

5

  • Consolidated underlying revenue grew 5%, with Consulting up 8% and Risk up 5%.

  • Adjusted EPS increased 10% year-over-year to $2.03.

  • Thrive program savings target increased from $400 million to $600 million.

  • Management Consulting revenue grew 14% on an underlying basis, driven by AI-related work.

  • Assets Under Management (AUM) increased 23% year-over-year to $843 billion.

Concerns

3

  • Reinsurance revenue declined 6% on an underlying basis due to continued softness in property reinsurance rates and tough comparisons.

  • Primary commercial insurance rates decreased 5% globally, with global property rates down 10%.

  • Workforce & Rewards revenue was down 1% due to a challenging environment in the Middle East.

Guidance & targets

CategoryTargetConfidence
Full-year 2026 underlying revenue growth
similar to last year
high materiality
High
Full-year 2026 margin expansion
another year of margin expansion
high materiality
High
Full-year 2026 adjusted EPS growth
solid adjusted EPS growth
high materiality
High
Thrive program savings target
$600 million
high materiality
High
Thrive program costs
approximately $750 million
medium materiality
High
Management Consulting full-year growth
high single-digit growth
medium materiality
Medium
Fiduciary interest income
approximately $94 million
low materiality
High
FX impact on Q4 earnings
immaterial effect
low materiality
High
Adjusted corporate expense
approximately $80 million
low materiality
High
Interest expense
$255 million
low materiality
High
Adjusted effective tax rate
around 25%
medium materiality
High
Full-year 2026 capital deployment
approximately $5.5 billion
high materiality
High

Segment performance

SegmentRevenueYoYQoQMargin
Consolidated
Strong quarter reflecting market-leading positions and client value. Underlying growth of 5% with double-digit EPS growth.
Underlying revenue growth: 5%Adjusted operating income growth: 6%Adjusted operating margin: 22.7%GAAP operating income: $1.2 billionAdjusted EPS: $2.03Adjusted EPS growth: 10% YoYGAAP EPS: $1.69
$6.9 billion8%—$1.5 billion adjusted operating income
Consolidated (9 Months)
Continued momentum in underlying revenue growth and double-digit EPS growth.
Underlying revenue growth: 5%Adjusted operating income growth: 7%Adjusted operating margin: 28.1%Adjusted EPS: $8.29Adjusted EPS growth: 9% YoY
———$6.1 billion adjusted operating income
Risk and Insurance Services (RIS)
Solid performance with underlying growth of 3%.
Underlying growth: 3%Adjusted operating income growth: 4% YoYAdjusted operating margin: 24.6%GAAP operating income: $745 million
$4.2 billion7%—$1 billion adjusted operating income
Risk and Insurance Services (RIS) (9 Months)
Reflecting consistent underlying growth.
Underlying growth: 3%Adjusted operating income growth: 5% YoYAdjusted operating margin: 33.2%
$14.1 billion——$4.6 billion adjusted operating income
Risk
Strong growth despite headwinds from a soft pricing environment, driven by demand in digital infrastructure and transactional risk.
Underlying growth: 5%Sales and new business growth: solidDemand drivers: digital infrastructure, transactional risk
$3.7 billion10%——
Risk (9 Months)
Consistent underlying growth across the first nine months.
Underlying growth: 4%
$11.5 billion———
U.S. and Canada (Risk)
Solid underlying growth in the region.
Underlying growth: 4%
————
International (Risk)
Strong underlying growth, particularly in EMEA.
Underlying growth: 6%
————
EMEA (Risk)
Very robust and diversified growth, with strong new business and specialty performance despite geopolitical disruption.
Underlying growth: 7%New business growth: very high single-digitSpecialties growth: cyber, credit, marine, PAC
————
Asia Pacific (Risk)
Steady underlying growth.
Underlying growth: 4%
————
Latin America (Risk)
Growth was flat in the quarter.
Underlying growth: flat
————
Reinsurance
Revenue impacted by continued softness in property reinsurance rates and a tough comparison to a strong Q3 last year. Q3 is a small quarter for reinsurance.
Underlying growth: -6%New business growth: strongClient retention: high 90s
$374 million-6%——
Reinsurance (9 Months)
Better reflects top-line performance, with significant rate pressure offsetting strong new business and client retention.
Underlying growth: -1%
—-1%——
Consulting
Strong growth across the segment.
Underlying growth: 8%Adjusted operating income growth: 9% YoYAdjusted operating margin: 22.1%GAAP operating income: $563 million
$2.7 billion9%—$593 million adjusted operating income
Consulting (9 Months)
Consistent underlying growth and margin expansion.
Underlying growth: 7%Adjusted operating income growth: 11% YoYAdjusted operating margin: 21.4%
$7.8 billion——$1.7 billion adjusted operating income
People and Investments
Solid underlying growth across the practice areas.
Underlying growth: 5%
$1.7 billion6%——
People and Investments (9 Months)
Consistent underlying growth.
Underlying growth: 5%
$4.9 billion———
Health and Benefits
Continued growth across all regions.
Growth: 5%
————
Investments in Retirement
Led by the investments business, with strong AUM growth driven by new business and capital markets.
Growth: 8%Assets under management: $843 billion (Q3 end)Assets under management growth: 23% YoY
————
Workforce & Rewards
Growth in the U.S. and most international regions was offset by a challenging environment in the Middle East.
—-1%——
Management Consulting
Great results reflecting strong demand and delivery, with a benefit from favorable timing of success fees expected in Q4.
Underlying growth: 14%Demand drivers: strong demand and delivery, especially AI-related work
$1 billion14%——
Management Consulting (9 Months)
Strong underlying growth for the first nine months.
Underlying growth: 11%
$2.9 billion———

MRSH operating KPIs by quarter

MRSH operating KPIs stated on its earnings calls, by fiscal quarter
KPI Sep 2025 Q3 FY25 Dec 2025 Q4 FY25 Mar 2026 Q1 FY26 Jun 2026 Q2 FY26This call Sep 2026 Q3 FY26Change vs prior quarter
Assets under management (AUM) Mercer
$683B Our assets under management were $683 billion at the end of the third quarter, up 2% sequentially and up 25% compared to the third quarter of last year. Source: earnings call transcript
$692B Our assets under management were $692 billion at the end of the fourth quarter, up 1% sequentially and up 12% compared to the fourth quarter of last year. Source: earnings call transcript
$727B Our assets under management were $727 billion at the end of the first quarter, up 5% sequentially and up 19% compared to the first quarter of last year. Source: earnings call transcript
$846B Our assets under management were $846 billion at the end of the second quarter, up 16% sequentially and up 26% compared to the second quarter of last year. Source: earnings call transcript
$843B Our assets under management were $843 billion at the end of the third quarter, flat sequentially and up 23% from the third quarter last year. Source: earnings call transcript
-0.4%

Operating figures the company stated on at least two of the calls shown, checked against each call's transcript. Click a figure to read the sentence. A dash means it was not stated that quarter.

Product announcements

ProductTypeDetails
Marsh Risk Companionlaunch
Stratus Exchangelaunch
Broker Workbenchlaunch
LAN AImilestone

Deals & partnerships

Bloomberg New Economy Co-chairing the competitive Resilience Coalition as knowledge partner for Bloomberg New Economy.

Bringing together business and government leaders to strengthen resilience and help organizations navigate a complex environment.

Astara Acquisition of Astara.

Closed earlier in the third quarter.

Midwest Agency Acquisition of a top 100 agency in the Midwest.

Announced on October 1st, part of the ongoing strategy to invest in the middle market.

Risks & headwinds

Soft pricing environment in primary commercial insurance Q3 FY26, ongoing

Global rates decreased 5% in Q3 (following 6% decline in Q2); Global property rates decreased 10%; U.S. rates decreased 1%; Canada, Europe, Asia declined mid-single digits; U.K., Latin America declined high single digits; Pacific region had double-digit decreases.

Mitigation:Focus on delivering value to clients, leveraging market-leading positions, and investing in new capabilities to drive growth despite pricing headwinds.

Soft market conditions in reinsurance Q3 FY26, expected to persist through January 1 renewal cycle

Reinsurance revenue down 6% underlying in Q3; down 1% underlying for 9 months. Property reinsurance rates soft, competitive.

Mitigation:Strong new business growth and excellent client retention (high 90s); exploring alternative options like third-party capital solutions; leveraging expertise in M&A advisory and alternative capital.

Challenging environment in the Middle East Q3 FY26, ongoing

Workforce & Rewards revenue down 1% (offsetting growth in U.S. and other international regions).

Mitigation:Leveraging the resilience and focus of over 2,500 colleagues in the region; continued focus on delivering for clients.

Potential for heightened cyber exposure from AI Ongoing

Discussed as a 'potentially severe, systemic or irreversible risk'.

Mitigation:Working with governments, insurance companies, and businesses to create awareness and resilience; active in helping clients manage these risks and capture opportunities from AI.

Inflationary pressure and loss costs in casualty Q3 FY26, ongoing

U.S. excess casualty rates up 13%.

Mitigation:Market conditions remain supportive for insurance and reinsurance clients, helping them optimize risk financing.

What to watch in Q4 FY26

Management Consulting revenue growth

Q4 FY26
Current 14% underlying growth in Q3
Target roughly flat top line

Why it matters

Management noted favorable timing of success fees in Q3, implying a slowdown in Q4. Verifying this will indicate underlying demand trends.

For the full year, Management Consulting is on pace for high single-digit growth, which would imply a roughly flat top line in Q4 due in part to the timing I mentioned.

Find out whether MRSH delivers this. Inve re-checks your case every morning.

Q&A highlights

How is Marsh using AI to drive margin expansion, similar to peers, and what are the broader implications for growth?

John Doyle emphasized that AI is already a factor, driving efficiency and growth by enhancing client relationships and operations. He highlighted the role of BCS in leveraging technology, including AI, for process automation and workflow optimization, leading to efficient CapEx and future efficiency gains. He also noted the importance of AI for client service and overall earnings growth.

“But yes, it's helping drive some efficiency for us today. We're now not quite 3 years into BCS. We formed BCS almost 3 years ago. It was in the first quarter of of 2024. We're excited about the work that our team is doing there looking at leveraging the best tech not just AI, I would point out, but automating processes, challenging workflows all across the company.”

asked by Charles Peters · answered by John Doyle

2 min read 5 chapters

Detailed narrative

Strategic Vision and Market Positioning

Marsh & McLennan is positioning itself as a professional services firm across risk, strategy, people, and investments, aiming to help clients build resilience in a period of structural change and uncertainty. The company believes its market-leading positions, proprietary data sets, and commitment to client value are key differentiators. This vision is underscored by the formation of the Resilience Coalition with Bloomberg New Economy, co-chaired by Marsh, to address global challenges like wars, geoeconomics, extreme weather, and AI advances.

AI Integration and Innovation

AI is already a significant factor in Marsh's business, enhancing client relationships, operations, and colleague productivity. The company is focused on building AI-enabled products like Marsh Risk Companion for actionable insights, consulting on AI transformation through Oliver Wyman's Quotient practice, and supporting the digital infrastructure ecosystem. Internally, AI tools like Broker Workbench are reducing placement times from weeks to hours, demonstrating tangible efficiency gains and improved client service.

Thrive Program Expansion and Efficiency

The Thrive program, initially targeting $400 million in savings, has been expanded to $600 million due to greater opportunities identified in Business & Client Services (BCS) and technology advancements. These savings, with associated costs of approximately $750 million, are being reinvested into sales capacity, new capabilities, brand development, and technology. The program emphasizes simplifying the organization, right-shoring actions, and reengineering processes to drive efficiency and support future growth.

Competitive Landscape and M&A Strategy

Marsh & McLennan views its middle-market presence, particularly Marsh Agency, as a long-standing strength built through over 130 acquisitions over 15 years. The company emphasizes a disciplined and balanced capital management strategy, favoring organic investment and a 'string of pearls' M&A approach rather than large, transformative deals. While acknowledging a potential bid-ask gap in the current M&A market, Marsh remains active, having closed Astara and announced a Midwest agency acquisition in the quarter.

Insurance Market Dynamics and AI Exclusions

The primary commercial insurance market saw rates decrease by 5% in Q3, with global property rates down 10%, benefiting clients but creating headwinds for revenue growth. In reinsurance, soft market conditions persist, driven by abundant capacity and benign property cat losses. Marsh is actively engaging in discussions regarding AI exclusions in insurance policies, advocating for thoughtful approaches that avoid broad exclusions which could create confusion and gaps in coverage, while working with carriers to evolve products for emerging AI risks.

Summary of the company's earnings call. Not investment advice.