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Moelis & Company: Record First Half as Capital Markets and Private Capital Advisory Take the Torch

Non-M&A revenue hits records, pipeline at all-time high, and sponsor engagement shows signs of life.
MC · Earnings Call · 2026-07-29

Record Revenues and a Pivoting Mix

On July 29, Moelis reported record second-quarter revenues of $409 million, up 12% year over year, and record first-half revenues of $729 million, up 9%. The growth was driven by non-M&A businesses, particularly capital markets and private capital advisory (PCA). As CEO Navid Mahmoodzadegan put it, “The second quarter was another strong period for our firm. We reported revenues of $409 million, up 12% year over year.” — Navid Mahmoodzadegan, CEO and Co-Founder · 2026-07-29 This marks an inflection point: the firm's announced pipeline is up 80% year over year, and the overall pipeline is at a record, setting the stage for a strong back half.

Capital Markets and Private Capital Advisory: The New Growth Engines

Navid highlighted that “Collectively, our non-M&A businesses generated record revenues in the first half led by capital markets and the growing contribution from private capital advisory.” — Navid Mahmoodzadegan, CEO and Co-Founder · 2026-07-29 The capital markets business achieved record second-quarter and first-half revenues, driven by late-stage growth financings and healthy IPO activity. The firm is expanding into securitization, with two new managing director hires in debt capital markets and structured products. Meanwhile, the PCA team has reached critical mass with seven dedicated MDs and is moving into LP-led secondaries and promoted co-investments. This product diversification is expected to provide a more durable revenue base.

M&A Cycle, Sponsor Engagement, and the Pipeline

Navid remains bullish on the M&A cycle, stating:

I mentioned, you know, our overall pipeline is at a record level, you know, as of you know, at the end of the second quarter.

Navid Mahmoodzadegan, CEO and Co-Founder · 2026-07-29
He sees the market in "early innings" and points to accessible financing, strong equity markets, and a constructive regulatory environment. Sponsor engagement is high, though middle-market exits have lagged due to valuation gaps; Navid noted, "I think we are starting to see a little bit of improvement in the $1 billion to $5 billion range," signaling a potential broadening of the M&A recovery. The firm's record AI disruption in software is also creating a differentiated set of opportunities, from liability management for disrupted businesses to M&A for AI beneficiaries.

AI Disruption, Talent, and Financial Discipline

On AI's impact, Navid echoed the three-bucket framework from last quarter: “If you go back and listen to our call from a quarter ago, we had a very similar construct that we laid out for how we thought the software disruption would play out.” — Navid Mahmoodzadegan, CEO and Co-Founder · 2026-07-29 The firm is seeing clear differentiation among software companies, with some thriving and others needing capital structure solutions. On talent, Moelis has hired 12 lateral MDs year to date, and the comp ratio improved to 65.8% from 69% a year ago, showing operating leverage. The firm's strong balance sheet—$481 million in cash and no debt—supports continued investment. Operating income in the most recent quarter stood at $46 million, down sequentially but up 7% year over year. With a record pipeline and expanding capabilities, Moelis appears well-positioned to capitalize on the next phase of the M&A cycle.