Jefferies Financial Group Inc. (JEF)

1	Jefferies Financial Group Inc.

PART I

Item 1. Business

Introduction

Jefferies Financial Group Inc. (“Jefferies,” “we,” “us” or “our”) is a

U.S.-headquartered global investment banking and capital

markets firm. Our largest subsidiary, Jefferies LLC, a U.S. broker-

dealer, was founded in the U.S. in 1962 and our first international

operating subsidiary, Jefferies International Limited, a U.K.

broker-dealer, was established in the U.K. in 1986. Our strategy

focuses on driving momentum in our investment banking

business, bringing value to clients and executing in our capital

markets sales and trading businesses and growing our credit and

alternative asset management platforms. We are always client

focused first and committed to integration and collaboration

across our businesses.

Our global headquarters and executive offices are located at 520

Madison Avenue, New York, New York 10022. We also have

regional headquarters in London and Hong Kong. Our primary

telephone number is 212-284-2300 and our Internet address is

jefferies.com where we make available, free of charge, our annual

reports on Form 10-K, quarterly reports on Form 10-Q and current

reports on Form 8-K and amendments to those reports filed or

furnished pursuant to Section 13(a) or 15(d) of the Securities

Exchange Act of 1934, as well as proxy statements, as soon as

reasonably practicable after we electronically file with the U.S.

Securities and Exchange Commission (“SEC”) and can also be

viewed at sec.gov.

The following documents and reports are also available on our

public website:

•Audit Committee Charter

•Code of Business Practice

•Compensation Committee Charter

•Corporate Governance Guidelines

•Corporate Social Responsibility Principles

•Reportable waivers, if any, from our Code of Business Practice

by our executive officers

•Culture and Community Committee Charter

•Health and Safety Policy

•Human Rights Statement

•Nominating and Corporate Governance Committee Charter

•Risk and Liquidity Oversight Committee Charter

•Supplier Code of Conduct

•Sustainable Investment Statement

•Whistle Blower Policy

We may use our website to disclose public information. We

encourage you to visit our website for additional information. In

Loading financial statements...

Financial statements

data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .

From 10-Q filed 2026-07-09 (period ending 2026-05-31).

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Forward-Looking Statements

This report may contain or incorporate by reference certain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934 and/or the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements about our future and statements that are not historical or current facts. These forward-looking statements are often preceded by the words “should,” “expect,” “believe,” “intend,” “may,” “will,” “would,” “could” or similar expressions. Forward-looking statements may contain expectations regarding revenues, earnings, operations and other results, and may include statements of future performance, plans and objectives. Forward-looking statements also include statements pertaining to our strategies for future development of our business and products. Forward-looking statements represent only our belief regarding future events, many of which by their nature are inherently uncertain. It is possible that the actual results may differ, possibly materially, from the anticipated results indicated in these forward-looking statements. Information regarding important factors that could cause actual results to differ, perhaps materially, from those in our forward-looking statements is contained in this report and other documents we file. You should read and interpret any forward-looking statement together with these documents, including the following:

•the description of our business and risk factors contained in our Annual Report on Form 10-K for the year ended November 30, 2025 and filed with the Securities and Exchange Commission (“SEC”) on January 28, 2026;

•the discussion of our analysis of financial condition and results of operations contained in this report under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations” herein;

•the discussion of our risk management policies, procedures and methodologies contained in this report under the caption “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Risk Management” herein;

•the consolidated financial statements and notes to the consolidated financial statements contained in this report; and

•cautionary statements we make in our public documents, reports and announcements.

Any forward looking statement speaks only as of the date on which that statement is made. We undertake no obligation to update any forward looking statement to reflect events or circumstances that occur after the date on which the statement is made, except as required by applicable law.

Our business, by its nature, does not produce predictable or necessarily recurring earnings. Our results in any given period can be materially affected by conditions in global financial markets, economic conditions generally and our own activities and positions.

Consolidated Results of Operations

Overview

	Three Months Ended May 31,
$ in thousands	2026			2025			% Change
Net revenues	$	2,206,451		$	1,634,447		35.0	%
Non-interest expenses	1,890,902			1,499,546			26.1	%
Earnings before income taxes	315,549			134,901			133.9	%
Income tax expense	65,571			43,506			50.7	%
Net earnings	249,978			91,395			173.5	%
Net losses attributable to noncontrolling interests	(5,440)			(7,668)			(29.1)	%
Preferred stock dividends	29,184			11,046			164.2	%
Net earnings attributable to common shareholders	226,234			88,017			157.0	%
Effective tax rate	20.8		%	32.3		%
	Six Months Ended May 31,
$ in thousands	2026			2025			% Change
Net revenues	$	4,223,581		$	3,227,466		30.9	%
Non-interest expenses	3,695,816			2,941,500			25.6	%
Earnings before income taxes	527,765			285,966			84.6	%
Income tax expense	118,441			57,722			105.2	%
Net earnings	409,324			228,244			79.3	%
Net losses attributable to noncontrolling interests	(21,298)			(14,651)			45.4	%
Preferred stock dividends	48,461			26,940			79.9	%
Net earnings attributable to common shareholders	382,161			215,955			77.0	%
Effective tax rate	22.4		%	20.2		%

Executive Summary

Three Months Ended May 31, 2026 Versus May 31, 2025

Net earnings attributable to common shareholders were $226.2 million and $88.0 million for the three months ended May 31, 2026 and 2025, respectively.

Our effective tax rate was 20.8%, and 32.3% for the three months ended May 31, 2026 and 2025, respectively.

Six Months Ended May 31, 2026 Versus May 31, 2025

Net earnings attributable to common shareholders were $382.2 million and $216.0 million for the six months ended May 31, 2026 and 2025, respectively.

Our effective tax rate was 22.4%, and 20.2% for the six months ended May 31, 2026 and 2025, respectively.

The remainder of our “Consolidated Results of Operations” is presented on a detailed product and expense basis. Our “Revenues by Source” is reported along the following business lines: Investment Banking, Equities, Fixed Income and Asset Management.

At May 31, 2026, we had 7,371 employees globally across all of our consolidated subsidiaries within our Investment Banking and Capital Markets and Asset Management reportable segments, compared to 7,787 at November 30, 2025. Included within our global headcount are 1,334 employees at May 31, 2026 and 1,797 employees at November 30, 2025 of our Stratos, Tessellis, HomeFed and M Science subsidiaries.

May 2026 Form 10-Q

Revenues by Source

We present our results as two reportable business segments: Investment Banking and Capital Markets and Asset Management. Additionally, corporate activities are fully allocated to each of these reportable business segments.

Net revenues presented for our Investment Banking and Capital Markets reportable segment include allocations of interest income and interest expense as we assess the profitability of these businesses inclusive of these costs, including the net interest cost of allocated short- and long-term debt, which is a function of the mix of each business’s associated assets and liabilities and the related funding costs.

Debt valuation adjustments on derivative contracts, gains and losses on investments held in deferred compensation plans, foreign currency transaction gains or losses or certain other corporate income items are not considered by management in assessing the financial performance of our operating businesses and are, therefore, not reported as part of our business segment results.

	Three Months Ended May 31,
	2026				2025
$ in thousands	Amount		% of Net Revenues		Amount		% of Net Revenues		% Change
Advisory	$	674,118	30.6	%	$	457,860	28.0	%	47.2	%
Equity underwriting	370,691		16.8		122,366		7.5		202.9
Debt underwriting	160,186		7.3		205,363		12.6		(22.0)
Other investment banking	1,825		—		(19,282)		(1.2)		N/M
Total Investment Banking	1,206,820		54.7		766,307		46.9		57.5
Equities	600,751		27.2		526,244		32.2		14.2
Fixed income	198,541		9.0		177,911		10.9		11.6
Total Capital Markets	799,292		36.2		704,155		43.1		13.5
Total Investment Banking and Capital Markets (1)	2,006,112		90.9		1,470,462		90.0		36.4
Asset management fees and revenues	15,169		0.7		20,766		1.3		(27.0)
Investment return	31,037		1.4		50,404		3.1		(38.4)
Allocated net interest (2)	(22,935)		(1.0)		(19,144)		(1.2)		19.8
Other investments, inclusive of net interest	164,447		7.5		102,595		6.3		60.3
Total Asset Management	187,718		8.6		154,621		9.5		21.4
Other	12,621		0.5		9,364		0.5		34.8
Net revenues	$	2,206,451	100.0	%	$	1,634,447	100.0	%	35.0	%

	Six Months Ended May 31,
	2026				2025
$ in thousands	Amount		% of Net Revenues		Amount		% of Net Revenues		% Change
Advisory	$	1,201,246	28.4	%	$	855,640	26.5	%	40.4	%
Equity underwriting	676,660		16.0		250,886		7.8		169.7
Debt underwriting	342,044		8.1		404,725		12.5		(15.5)
Other investment banking	4,163		0.2		(44,252)		(1.4)		N/M
Total Investment Banking	2,224,113		52.7		1,466,999		45.4		51.6
Equities	1,159,239		27.4		935,302		29.0		23.9
Fixed income	418,809		9.9		467,137		14.5		(10.3)
Total Capital Markets	1,578,048		37.3		1,402,439		43.5		12.5
Total Investment Banking and Capital Markets (1)	3,802,161		90.0		2,869,438		88.9		32.5
Asset management fees and revenues	85,079		2.0		109,396		3.4		(22.2)
Investment return	120,029		2.8		44,770		1.4		168.1
Allocated net interest (2)	(45,173)		(1.1)		(36,365)		(1.1)		24.2
Other investments, inclusive of net interest	248,045		5.9		228,535		7.1		8.5
Total Asset Management	407,980		9.6		346,336		10.8		17.8
Other	13,440		0.4		11,692		0.3		15.0
Net revenues	$	4,223,581	100.0	%	$	3,227,466	100.0	%	30.9	%

N/M — Not Meaningful

(1)Allocated net interest is not separately disaggregated for Investment Banking and Capital Markets. This presentation is aligned to our Investment Banking and Capital Markets internal performance measurement.

(2)Allocated net interest represents an allocation to Asset Management of our long-term debt interest expense, net of interest income on our Cash and cash equivalents and other sources of liquidity. Allocated net interest has been disaggregated to increase transparency and to make clearer actual Investment return. We believe that aggregating Investment return and Allocated net interest would obscure the Investment return by including an amount that is unique to our credit spreads, debt maturity profile, capital structure, liquidity risks and allocation methods.

Investment Banking Revenues

Investment banking is composed of revenues from:

•advisory services with respect to mergers and acquisitions, debt financing, restructurings and private capital transactions;

•underwriting services, which include debt underwriting, syndication and placement services related to investment grade debt, high yield bonds, leveraged loans, emerging market debt, global structured notes, municipal debt and mortgage-backed and asset-backed securities; and equity underwriting and placement services related to equity offerings, preferred stock and equity-linked securities;

•our 50% share of net earnings from our Jefferies Finance joint venture;

•our 45% share of net earnings from our commercial real estate joint venture, Berkadia, which includes commercial mortgage origination and servicing as well as investment sales;

•securities and loans received or acquired in connection with our investment banking activities; and

•certain revenue-sharing agreements with SMBC primarily associated with investment banking transactions.

Jefferies Financial Group Inc.

	Deals Completed
	Three Months Ended May 31,		Six Months Ended May 31,
	2026	2025	2026	2025
Advisory transactions	118	84	217	176
Public and private equity and convertible offerings	74	45	130	80
Public and private debt financings	254	268	511	481

	Aggregate Value
	Three Months Ended May 31,				Six Months Ended May 31,
$ in billions	2026		2025		2026		2025
Advisory transactions	$	180.8	$	87.2	$	268.3	$	199.0
Public and private equity and convertible offerings	118.8		21.6		155.9		44.0
Public and private debt financings	62.1		100.3		206.0		247.5

Three Months Ended May 31, 2026 Versus May 31, 2025

Investment banking net revenues were $1.21 billion, up 57.5% compared to $766.3 million for the prior year quarter.

Advisory had its best quarter ever, with net revenues of $674.1 million, up 47.2% compared to $457.9 million for the prior year quarter, driven by market share gains and increased industry volumes.

Total underwriting net revenues were $530.9 million, up 62.0% from $327.7 million for the prior year quarter, primarily driven by market share gains and increased activity in Equity underwriting across most sectors. Debt underwriting remained solid, but decreased compared to the prior year quarter primarily due to lower deal values and lower origination of asset-backed securities.

Other investment banking net revenues were $1.8 million, compared to net revenues of $(19.3) million for the prior year quarter, with higher mark-to-market net gains on certain investment positions for the current quarter. Performance from our Jefferies Finance joint venture improved, while performance from our Berkadia joint venture declined from the prior year quarter.

Our investment banking backlog remains strong, although the extent and timing of its realization is always subject to change. Backlog snapshots are subject to limitations as the time frame for the realization of revenues from these expected transactions varies and is influenced by factors we do not control. Transactions not included in the estimate may occur, and expected transactions may be modified or cancelled.

Six Months Ended May 31, 2026 Versus May 31, 2025

Investment banking net revenues were $2.22 billion, up 51.6% compared to $1.47 billion for the prior year period.

Advisory net revenues were a record $1.20 billion and increased 40.4% compared to $855.6 million for the prior year period, driven by market share gains and increased overall market opportunity.

Total underwriting net revenues were $1.02 billion, up 55.4% compared to $655.6 million for the prior year period, primarily driven by market share gains and increased activity in Equity underwriting across a range of sectors and in a stronger issuance market. Debt underwriting remained solid but decreased compared to the prior year quarter primarily due to lower deal values.

Other investment banking net revenues were $4.2 million, compared to net revenues of $(44.3) million for the prior year period and include mark-to-market net gains on certain investment positions for the current quarter. Performance from our Jefferies Finance joint venture improved, while performance from our Berkadia joint venture declined from the prior year period.

Equities Net Revenues

Equities is composed of net revenues from:

•services provided to our clients for which we earn commissions or spread revenue by executing, settling and clearing transactions for clients;

•advisory services offered to clients;

•financing, securities lending and other prime brokerage services offered to clients, including capital introductions and outsourced trading;

•corporate equity derivative transactions; and

•wealth management services.

Three Months Ended May 31, 2026 Versus May 31, 2025

Equities net revenues were $600.8 million, up 14.2% from $526.2 million for the prior year quarter, marking our strongest quarter on record, due to market share gains and higher global trading volumes driving stronger results across most of our businesses, particularly within cash and electronic trading. Additionally, prime services continues to expand.

Six Months Ended May 31, 2026 Versus May 31, 2025

Equities net revenues were a record $1.16 billion, up 23.9% compared to $935.3 million for the prior year period, marking our strongest six months on record, due to market share gains and higher trading volumes driving stronger results across most of our businesses, particularly within cash and global electronic trading. Additionally, prime services continues to expand. Our equity options, convertibles, and corporate derivatives businesses also produced strong results.

Fixed Income Net Revenues

Fixed income is composed of net revenues from:

•executing transactions for clients and making markets in securitized products, investment grade, high-yield, distressed, emerging markets, municipal, sovereign and emerging markets securities and loans;

•customized products and corporate hedging and foreign currency solutions through derivative products; and

•financing and other structuring services.

Three Months Ended May 31, 2026 Versus May 31, 2025

Fixed income net revenues were $198.5 million, up 11.6% compared to $177.9 million for the prior year quarter. While both current and prior year quarters were impacted by major U.S. policy and geopolitical events, the markets were modestly more supportive in the current quarter, which supported improved results in our distressed, municipal securities and emerging markets businesses.

May 2026 Form 10-Q

Six Months Ended May 31, 2026 Versus May 31, 2025

Fixed income net revenues were $418.8 million, down 10.3% compared to $467.1 million for the prior year period, as credit markets remained challenging in the current year for the products and services where we are most active, impacting the overall trading environment and several of our businesses. Strong performance in our municipal securities, distressed and emerging markets businesses was more than offset by lower results from our securitized products business, which includes a gross mark-to-market loss of $58.7 million associated with Market Financial Solutions during the current period.

Asset Management

We operate a diversified alternative asset management platform that provides institutional clients with a broad range of investment strategies, both directly and through our strategic affiliated asset managers. Certain affiliated managers also benefit from access to our global marketing and distribution platform, as well as operational infrastructure and support. Our asset management business makes seed and additional strategic investments directly in alternative asset management separately managed accounts and co-mingled funds where we act as the asset manager or in affiliated asset managers where we have strategic relationships and participate in the revenues or profits of the affiliated manager.

Asset management fees and revenues primarily consist of:

•Management and performance fees from funds and accounts managed by us;

•Placement and distribution fees for raising capital from investors; and

•Revenue from strategic affiliated asset managers where we are entitled to portions of their operating revenues and income based on our ownership interests in the affiliates.

Fees and revenues are generally tied to the value of assets under management and the performance of those assets. Performance-based fees are earned when returns exceed specified benchmarks or performance targets and are typically recognized annually generally in our first quarter, once they become fixed and determinable and are not subject to significant reversal.

We also generate an investment return from capital invested in our managed funds and in funds managed by our affiliated asset managers. Additionally, we earn revenues from other investments, including our portfolio of real estate development activities, foreign exchange trading, and telecommunications operations.

	Three Months Ended May 31,
$ in thousands	2026		2025		% Change
Asset management fees and other	$	3,593	$	7,495	(52.1)	%
Revenue from strategic affiliates (1)	11,576		13,271		(12.8)	%
Total asset management fees and revenues	15,169		20,766		(27.0)	%
Investment return	31,037		50,404		(38.4)	%
Allocated net interest	(22,935)		(19,144)		19.8	%
Other investments	164,447		102,595		60.3	%
Total Asset Management	$	187,718	$	154,621	21.4	%
	Six Months Ended May 31,
$ in thousands	2026		2025		% Change
Asset management fees and other	$	10,492	$	53,302	(80.3)	%
Revenue from strategic affiliates (1)	74,587		56,094		33.0	%
Total asset management fees and revenues	85,079		109,396		(22.2)	%
Investment return	120,029		44,770		168.1	%
Allocated net interest	(45,173)		(36,365)		24.2	%
Other investments	248,045		228,535		8.5	%
Total Asset Management	$	407,980	$	346,336	17.8	%

(1) Amounts include our share of fees received by affiliated asset management companies with which we have revenue and profit share arrangements, as well as earnings on our ownership interest in affiliated asset managers.

Three Months Ended May 31, 2026 Versus May 31, 2025

Asset management fees and revenues were $15.2 million, down 27.0% compared to $20.8 million for the prior year quarter, reflecting lower management fees on funds and accounts managed by us, primarily Point Bonita, as well as funds and accounts managed by our strategic affiliates.

Investment return was $31.0 million, down 38.4% compared to $50.4 million for the prior year quarter, as strong performance from strategies with a long equity bias was offset by lower performance across other fund strategies and the impact of reduced capital allocated to certain funds based on our strategy to reduce capital committed and reposition the business in recognition of our upcoming acquisition of Hildene Holdings.

Other investments net revenues were $164.4 million, up 60.3% compared to $102.6 million in the prior year quarter, primarily due to improved results from HomeFed and mark-to-market gains on certain investments.

Loading holders...

Held by

holders ( registered funds via N-PORT, institutional investors via 13F). Showing top by dollar value.

Holder	Type	ETF	MF	Position ($)	% of holder	Δ % of holder	Holder AUM

Next expected filings

~2026-10-09 10-Q expected by 2026-11-08 (in 2 days)
~2027-01-28 10-K expected by 2027-03-18 (in 113 days)
~2027-04-07 10-Q expected by 2027-05-07 (in 182 days)
~2027-07-09 10-Q expected by 2027-08-08 (in 275 days)

Predicted from historical filing cadence; not an SEC commitment.

Recent SEC filings

2026-09-28 8-K Earnings Release; Financial Statements and Exhibits
2026-09-25 424B2 Prospectus Supplement
2026-09-24 424B2 Prospectus Supplement
2026-09-24 424B2 Prospectus Supplement
2026-09-24 424B2 Prospectus Supplement
2026-09-23 424B2 Prospectus Supplement
2026-09-17 424B2 Prospectus Supplement
2026-09-16 424B2 Prospectus Supplement
2026-09-16 424B2 Prospectus Supplement
2026-09-16 424B2 Prospectus Supplement
2026-09-15 424B2 Prospectus Supplement
2026-09-15 424B2 Prospectus Supplement
2026-09-15 424B2 Prospectus Supplement
2026-09-15 424B2 Prospectus Supplement
2026-09-14 424B2 Prospectus Supplement

Line item
Period ending