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Piper Sandler (PIPR) Q2 FY26 earnings call: guidance and Q&A

Earnings call· Jun 2026 (Q2 FY26)· Financials· Jul 30, 2026

Source: earnings call transcript

Executive summary

Piper Sandler Q2 FY26 — Record Advisory and Equity Brokerage Performance

Piper Sandler delivered a strong second quarter, marked by record advisory and equity brokerage revenues, contributing to its 11th consecutive quarter of year-over-year revenue growth. The firm's diversified model, particularly its strength in Financial Services and Healthcare, enabled it to navigate varied market conditions, though fixed income faced headwinds. Management remains focused on strategic investments and disciplined cost management to drive continued long-term growth.

Highlights

5

  • Adjusted net revenues reached $491 million, up 21% year-over-year, marking the 11th consecutive quarter of YoY growth.

  • Advisory Services achieved record Q2 revenues of $274 million, a 34% increase year-over-year, driven by 83 transactions.

  • Corporate Investment Banking revenues grew 31% year-over-year to $312 million, contributing to a record first half performance of $636 million.

  • Equity brokerage generated record Q2 revenues of $63 million, up 8% year-over-year, and traded 6.6 billion shares in H1.

  • Municipal financing revenues were $50 million, up 18% year-over-year, representing the strongest second quarter on record.

Concerns

5

  • Fixed income revenues were down sequentially and year-over-year due to challenging market conditions, including geopolitical events and interest rate uncertainty.

  • Corporate financing revenues, while up 10% year-over-year, were down from a very strong first quarter.

  • The governmental business within Public Finance experienced a year-over-year decline in Q2.

  • Middle market M&A close rates have been lower than in the past, despite good pitch calendars and new mandates.

  • The Q2 ECM business showed underperformance relative to the market, though H1 performance was strong overall.

Guidance & targets

CategoryTargetConfidence
Public Finance revenues
will decline from the robust second quarter
medium materiality
Medium
Equity Brokerage revenues
will follow historical trends, which typically reflect a seasonal decline
medium materiality
Medium
Fixed Income revenues
similar to the second quarter
medium materiality
Medium
Firm-wide net revenues
in line with the third quarter of 2025
high materiality
Medium

Segment performance

SegmentRevenueYoYQoQMargin
Corporate Investment Banking
Driven by robust advisory activity, with broad-based growth across nearly all sectors and products.
First half 2026 revenues: $636 millionFirst half 2026 YoY growth: 30%Strongest first half performance on record
$312 million31%——
Advisory Services
Performance led by Financial Services and Healthcare, with meaningful contributions from Services and Industrials. Strong momentum in Private Capital Advisory group.
83 advisory transactions completed17% increase in volumeFinancial Services led performanceHealthcare contributed strong resultsMed-Tech team advised on several largest dealsRanked #1 adviser in U.S. bank M&A by announced transaction count and deal value in H1Advisory revenues from Private Equity clients grew 10% YoYFirst half 2026 revenues: $525 millionFirst half 2026 YoY growth: 25%Sixth consecutive quarter of year-over-year growth
$274 million34%——
Corporate Financing
Activity fluctuates based on client and sector-specific dynamics, primarily in the Healthcare space.
28 financings completed$13 billion raised for corporate clientsFirst half 2026 revenues: $111 millionFirst half 2026 YoY growth: 65%33% increase in book-run transactions (H1)Higher average fees (H1)
$38 million10%down sequentially—
Public Finance
Attributable to the strength of the specialty business, particularly special district and hospitality groups. Governmental business remained resilient despite YoY decline.
141 municipal negotiated transactions underwritten$5 billion of par value raisedStrongest second quarter on recordFirst half 2026 YoY growth: 7%Outpacing 4% par value growth of municipal negotiated market (H1)
$50 million18%double Q1 revenues—
Equity Brokerage
Driven by successful execution of strategy and aided by benchmark rebalancing events in June.
Record second quarter revenuesFirst half 2026 revenues: $123 millionFirst half 2026 YoY growth: 10%6.6 billion shares traded (H1)14% increase in shares traded (H1)3 largest days in firm history by notional volume (Q2)
$63 million8%——
Fixed Income
Market environment remained challenging due to geopolitical events, interest rate uncertainty, and a flattening yield curve. Bank restructuring activity provided a partial offset.
$49 milliondowndown—

PIPR operating KPIs by quarter

PIPR operating KPIs stated on its earnings calls, by fiscal quarter
KPI Mar 2026 Q1 FY26This call Jun 2026 Q2 FY26Change vs prior quarter
Investment banking managing directors
192 We finished the quarter with 192 investment banking managing directors, the highest number in firm history. Source: earnings call transcript
193 We finished the quarter with 193 investment banking managing directors, a 6% increase year-over-year. Source: earnings call transcript
+0.5%

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.

Risks & headwinds

Challenging Fixed Income Market Q2 FY26

Fixed income revenues down sequentially and year-over-year.

Mitigation:Focused on providing tailored advice-driven solutions and partnering with banking colleagues for balance sheet restructuring advice.

Middle Market M&A Close Rates Recent past, impacting H2 outlook

Close rates have been a little lower than in the past.

Mitigation:Focus on larger fee transactions in the pipeline.

ECM Volatility Q2 FY26

Q2 ECM business showed underperformance relative to the market.

Mitigation:Strong backlog in healthy biotech/healthcare sector, which is the majority of their ECM business.

Increased Competition in Middle Market Ongoing

Directional, 'could increase competition' on select transactions from money center banks.

Mitigation:Firm's long-standing expertise and established deal flow in the middle market make it difficult for new entrants to quickly gain share.

What to watch in Q3 FY26

Middle Market M&A Close Rates

H2 FY26 / next quarter
Current a little lower than in the past
Target Improvement in close rates for new mandates

Why it matters

To indicate overall health and conversion of the middle market deal pipeline, impacting advisory revenue.

But the pitch calendars, new mandates, things look pretty good for the back half. It will just depend on close rates. I do think across the industry, I've seen some data from various auctions where the close rates have been a little lower than in the past.

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Q&A highlights

Is there a meaningful shift from dialogue to actual deals in the middle market, especially for sponsor activity, and what are expectations for H2?

Chad Abraham noted that middle market performance varies by sector, with Financial Services and Healthcare being strong. While overall sponsor business was up slightly for Piper Sandler, some sectors are tougher. Pitch calendars and new mandates look good for H2, but close rates have been lower.

“But the pitch calendars, new mandates, things look pretty good for the back half. It will just depend on close rates. I do think across the industry, I've seen some data from various auctions where the close rates have been a little lower than in the past.”

asked by Unknown Analyst · answered by Chad Abraham

2 min read 6 chapters

Detailed narrative

Strong First Half Performance and Diversified Model

Piper Sandler achieved its strongest first half performance on record, with Corporate Investment Banking revenues totaling $636 million, a 30% increase year-over-year. This broad-based growth across nearly all sectors and products validates the firm's strategy of combining deep sector expertise with a wide range of solutions, enabling it to perform well across various market conditions. The firm noted its 11th consecutive quarter of year-over-year revenue growth, highlighting the durability of its model.

Advisory Services Momentum

Advisory Services recorded $274 million in Q2 revenues, up 34% year-over-year, marking the sixth consecutive quarter of YoY growth. This was driven by 83 advisory transactions, a 17% increase in volume, and larger fees. Financial Services, particularly the #1 ranked U.S. bank M&A practice, and Healthcare, led by Med-Tech, were key contributors. The firm's Insurance and Asset Management franchises also contributed to this success.

Strategic Focus on Private Equity

Despite a challenging environment for sponsor activity, advisory revenues from Private Equity clients grew 10% year-over-year, outperforming the broader market. The firm is scaling this practice by transitioning senior leaders to focus on Private Equity advisory efforts, aiming to capture more M&A, debt capital markets advisory, continuation vehicles, and IPO activity as market conditions improve. The Private Capital Advisory group also recorded its best quarter, driven by secondary business.

Public Finance and Equity Brokerage Records

The Public Finance business generated $50 million in municipal financing revenues, an 18% year-over-year increase and its strongest second quarter on record, driven by specialty business strength and several large transactions. Equity brokerage also achieved record Q2 revenues of $63 million, up 8% year-over-year, aided by successful execution and unique benchmark rebalancing events in June, which produced its three largest days in firm history by notional volume.

Disciplined Cost Management

The firm maintained strong cost discipline, with a compensation ratio of 61.5% for both Q2 and H1, an improvement year-over-year. Non-compensation expenses were $82 million or 16.7% of net revenue in Q2. The H1 non-comp ratio improved by 230 basis points to 17.5%, demonstrating operating leverage as revenue expands, despite some litigation-related expenses in Q1 and anticipated upward pressure from new occupancy costs in New York.

Capital Allocation and Shareholder Returns

Piper Sandler repurchased 391,000 shares for $31 million in Q2 and paid $14 million in cash dividends. For the first half of 2026, $215 million was returned to shareholders, including $115 million in cash dividends ($1.625 per share) and $101 million in share repurchases (approximately 1.3 million shares). These buybacks have more than offset the share count dilution from 2026 annual grants, reinforcing the firm's commitment to disciplined capital management.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.