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Operator: Good afternoon and welcome to the Moelis & Company Earnings Conference Call for the Third Quarter of 2025. To begin, I'll turn the call over to Mr. Matt Tsukroff.
Matthew Tsukroff: Good afternoon and thank you for joining us for Moelis & Company's Third Quarter 2025 Financial Results Conference Call. On the phone today are Navid Mahmoodzadegan, CEO and Co-Founder; and Chris Callesano, Chief Financial Officer. Before we begin, I would like to note that the remarks made on this call may contain certain forward-looking statements, which are subject to various risks and uncertainties, including those identified from time to time in the Risk Factors section of Moelis & Company's filings with the SEC. Actual results could differ materially from those currently anticipated. The firm undertakes no obligation to update any forward-looking statements. Our comments today include references to certain adjusted financial measures. These measures, when presented together with comparable GAAP measures, are useful to investors to compare our results across several periods and to better understand our operating results. The reconciliation of these adjusted financial measures with the relevant GAAP financial information and other information required by Reg G is provided in the firm's earnings release, which can be found on our Investor Relations website at investors.moelis.com. I will now turn the call over to Navid.
Navid Mahmoodzadegan: Thank you, Matt. It's great to be with all of you for my first earnings call as CEO. The firm had a very strong third quarter. We achieved adjusted revenue of $376 million for the quarter and $1.05 billion for the first 9 months of 2025, representing increases of 34% and 37%, respectively, versus prior year periods. Our level of client engagement and new business origination continue to be robust, and our pipeline remains near all-time highs. To give you a sense of the firm's momentum, in just the past week, we advised clients on several significant transactions, including Essential Utilities on one of the largest U.S. utility mergers in history, the Delaware Attorney General on OpenAI's recapitalization and the New York Giants on the landmark sale of a minority stake in the historic NFL franchise. We remain active on the hiring front and finished the quarter with 170 managing directors. Year-to-date, we've hired 10 managing directors, including 5 MDs since our last earnings call. These MDs will enhance our expertise and global reach in key sectors and products, including technology, industrials, private capital advisory, capital markets and M&A. Now let me discuss each of our businesses, beginning with M&A. Our business this quarter benefited from both an increase in larger strategic M&A and sponsor transactions, resulting in a meaningful increase in our average M&A fee. On the strategic side, we are seeing corporates lean into transformative deals to achieve scale and navigate rapid technological change. This activity is supported by improved clarity around trade policy and tariffs and a more accommodative regulatory environment. On the sponsor side, the significant pent-up need for sponsors to return to capital to LPs and a robust financing environment have accelerated sponsor activity. These dynamics set the stage for what we believe will be a steadily improving multiyear M&A cycle. In Capital Structure Advisory, our team continues to be engaged on a healthy level of liability management assignments. While ample liquidity and access to diverse pools of capital are resulting in fewer traditional restructurings, our team is a leader in delivering out-of-court solutions for clients. Additionally, our recent investments in enhanced credit side coverage have diversified this business and position us well for future opportunities. Turning to Capital Markets. Our Capital Markets business has been a standout performer with year-to-date revenues more than double the same period last year. We're on pace for a record year as our enhanced capabilities in public and private capital markets have positioned us to take advantage of a risk-on environment to raise capital around growth companies and emerging technologies. We believe the massive expansion in private credit has also created a significant opportunity to help clients access this important asset class. And finally, as we look at Private Capital Advisory, we expect this business to be a key engine of growth, becoming a meaningful fourth pillar of our business and complementing our leading sponsor franchise. On our Q2 earnings call, we highlighted 3 significant hires, including our new Global Head of PCA. Since their joining, we have had seamless integration with our sector and sponsor coverage teams and seen substantial growth in active mandates focused on GP-led secondaries. We are very excited about our team's early momentum and expect PCA to become a significant contributor to our firm. We are continuing to hire talent at all levels and plan to build this business into a market leader. Looking ahead, we are optimistic about the continued improvement in the transaction environment. In the very near term, the U.S. government shutdown, depending upon how long it goes, could slow the pace of regulatory reviews potentially affecting deal closing time lines. However, from where we sit today, this is not impacting our clients' appetite for strategic transactions, and we expect continued acceleration in deal activity. I'll now pass the call to Chris to discuss our financial results before I wrap up with a few closing remarks. Chris, over to you.
Christopher Callesano: Thanks, Navid, and good afternoon, everyone. As Navid mentioned, we generated adjusted revenues of $376 million for the third quarter of 2025, an increase of 34% from the prior year period. For the first 9 months of 2025, we generated adjusted revenues of $1.05 billion, representing an increase of 37% from the prior year period. The increase during the quarter and the first 9 months of the year were driven by significant growth in our M&A and Capital Markets businesses, partially offset by a decline in Capital Structure Advisory. Our business mix for the third quarter and first 9 months of 2025 was approximately 2/3 M&A and 1/3 non-M&A. Turning to expenses. Our adjusted compensation expense ratio for the third quarter was 66.2% bringing our year-to-date ratio to 68%, down from 69% in the first half of 2025. Adjusted non-compensation expenses were $53 million for the third quarter, resulting in a 14% non-compensation expense ratio. Our adjusted non-compensation expenses for the first 9 months of 2025 were $163 million, resulting in a non-compensation expense ratio of 15.6%. The main drivers of the expense growth during the first 9 months of the year were increased deal-related T&E and client conferences, continued investments in technology and data, including AI and higher occupancy costs as a result of headcount growth. Our adjusted pre-tax margin was 22.2% for the third quarter, bringing our adjusted pre-tax margin to 18.2% for the first 9 months of the year, a significant improvement compared to the same 3- and 9-month periods in the prior year. Our tax rate for the third quarter was 29.5%, consistent with the prior quarter. Turning to capital return. The Board declared a regular quarterly dividend of $0.65 per share, consistent with the prior quarter. And during the third quarter, we repurchased approximately 206,000 shares of our common stock on the open market for a total cost of $14.5 million. Finally, we continue to maintain a strong balance sheet with approximately $620 million of cash and liquid investments and no debt. I will now pass the call back to Navid.
Navid Mahmoodzadegan: Thank you, Chris. I wanted to briefly touch on the three areas that I am intensely focused on in my new role: clients, culture and growth. First, clients. Clients will continue to remain at the center of everything we do. Our success flows directly from the success of our clients. Second, culture, maintaining and protecting our collaborative team-based culture enables us to provide the highest quality advice to clients and attract and retain the best talent in the world. Finally, growth. We have a tremendous opportunity to hire and develop difference makers to fill white space and further build leading centers of excellence throughout our firm. As we think about the opportunities ahead, we've never felt better about the quality and capabilities of our franchise and how well we are positioned to advise our clients in a more active market environment. With that, let's open the line up for questions.
Operator: [Operator Instructions] your first question comes from the line of Ken Worthington with JPMorgan.
Kenneth Worthington: A little esoteric here. Maybe first on restructuring. One of the narratives in the market is the disruptive nature of AI, particularly in parts of the tech sector. Are you seeing this risk start to pop up in your dialogue with your clients on the restructuring side? And is AI a theme that you think might be meaningful to restructuring as we look out over the next 1 to 2 years?
Navid Mahmoodzadegan: Yes. Thanks for the question, Ken. Look, I think AI is going to have a profound impact on our economy and sectors of our economy and companies in particular. It's obviously early days there in terms of the direct disruptive impact AI is going to have. But I do think, to your point, while it's still early days, I do think that disruption is going to create opportunities for us on the restructuring side as the rollout of AI and the impact on AI becomes apparent to corporate P&Ls. And so early days, I don't know that we've seen sort of a direct set of mandates that have come from that, but I think that's on the horizon.
Kenneth Worthington: Okay. Great. Sort of in the same vein, different topic, private credit. There seems to be differing perspectives between the banks and the alternative asset managers in terms of the state of the private credit markets. So for you guys as a third party in the market, are the recent higher profile defaults that we're seeing a concern to you? And do you see risk to M&A if we start to see "more cockroaches" emerge in private credit?
Navid Mahmoodzadegan: Sure. Look, we -- as you point out, we've seen an explosion of private credit as an asset class. That's generally good for our business because it gives us more opportunities to advise clients on accessing the private credit market. That's an area that's outside of the traditional banking system and banks that have advisory franchises attached to them. So we like the growth of private credit. We have deep sponsor relationships and lots of active dialogues with companies and sponsors trying to match sources of capital with our client base, alternative sources of capital with our client base. So big picture, very good for our business, as I highlighted in our remarks. Our Capital Markets business is benefiting from that. I don't think the -- a couple of the high-profile situations -- by the way, there were banks involved in some of those situations as well. I don't think those were particularly insulated as private credit situations or explicitly private credit situations. But look, when that much capital goes out in an asset class into all bunch of companies, there's going to be some mistakes. There's going to be some idiosyncratic situations that pop up. That's not a surprise that you'll see some of those, but I don't think there's a systemic problem with private credit. I'm not a believer in that scenario. I think private credit is going to continue to grow. There's a need for that source of capital to provide for companies and for growth. And there's lots of companies that find that source of capital really attractive. And I think that trend is going to continue, and it's good for our business.
Operator: Your next question comes from the line of Devin Ryan with Citizens JMP.
Devin Ryan: I want to start with just a kind of broad M&A question. Obviously, tracking some of the headline numbers, the recovery started kind of earlier in the summer and it seemingly continued, but a lot of that activity was driven by kind of larger deals, and so that helped the headline, but it wasn't as broad of a recovery. So I love to get a sense of how you're seeing kind of the breadth in the market today, whether that's smaller deals or sponsor deals, how the pace of those transactions are trending? And if it is really reaccelerating there and broadening, kind of when did that pick up? And any other framing around that would be helpful.
Navid Mahmoodzadegan: Sure. Yes. Thanks for the question, Devin. So I think you're right. It's definitely a larger transaction-driven market today. We see that certainly on the strategic side and also on the sponsor side. There's definitely a flight to size, a flight to quality in terms of the volume of sponsor transactions that are getting done today. And so I think both -- on both -- in both markets, larger transactions are definitely in the middle of the fairway. I do think we've seen and are starting to see a broadening of that market. What's really been missing on the sponsor side, especially is that heavy flow middle market, sub-$1 billion kind of flow of transactions. I do think it's starting to broaden out. We saw evidence in the third quarter of an uptick in volume of sponsor activity, not just deal size and dollar volume, but volume of transactions. And I do think that's what's coming, a broadening of that sponsor flow, that middle market flow I think, is hopefully in the offing as we roll into 2026. That's what it feels like to us. But you're right on the larger transactions, higher quality transactions, that's been driving a lot of the business over the last couple of quarters for us and for the industry.
Devin Ryan: Yes. Great color. And then a follow-up here just on compensation. So revenues up really strong year-to-date, 37% comp, expense up 24%. So nice to see some leverage there. Obviously, we don't know the full year revenues, but it would be good just to get a sense of how you would frame the 68% comp ratio year-to-date. Like is that a good number on the year? Or is there potentially -- is that one step toward potentially additional leverage as we get better visibility on the full year? And that's one part of the question. The second part is just based on where we are in this kind of M&A recovery that you talked about, Navid, still seems like a fair amount of revenue upside for Moelis as conditions normalize. And so just trying to think about how much more comp leverage there may be in that scenario to the extent the 37% year-to-date is just the beginning of potentially much more revenue upside from here.
Navid Mahmoodzadegan: Thanks, Devin. Let me try to take -- tackle that question. So I think we kind of look back historically at this time last year. I think our year-to-date comp ratio was 75%. We ended the year at 69% when you factored in the fourth quarter. And now year-to-date, we're at 68%. So I think we are making progress towards a more normalized comp ratio. And I think we've committed that as the market improves, as we realize a return on many of these investments, we've been making great investments in very, very talented people in big TAMs that as we see a return in that, as the market improves, depending upon market conditions and what the competitive environment looks like for talent, we want to bring that comp ratio down further. We'll see what that means for the fourth quarter. Right now, 68% is our best guess. But last year, we were at 75%, and we ended up at 69% depending upon the fourth quarter. So we appreciate very much the flexibility our investors and the confidence our investors have shown in us to exceed normal ratios for a period of time here. That's enabled us and given us flexibility to do great things that we're really excited about in terms of continuing to build the firm. But these kinds of ratios aren't where we want to be. We want to be at more normalized ratios, and we're committed to getting there over time.
Operator: Your next question comes from the line of James Yaro with Goldman Sachs.
James Yaro: So we're 9, 10 months into the second Trump administration. Companies do appear more comfortable with the regulatory backdrop. Maybe you could just talk about the antitrust dialogues that you're having with -- in the boardroom. And then maybe you could also just talk about the broader deregulatory impacts and whether that's driving deal activity as well.
Navid Mahmoodzadegan: Sure. Well, look, as I noted in our remarks, clearly, the more accommodative regulatory outlook, the perception that the government is going to be more accommodating on improving transactions. Clearly, in the last administration, there was a view that bigger is worse. And I think as we look at the landscape, I don't think that's the view of the current administration. And so that is allowing for companies to think big and pursue larger transactions, which may have been more difficult in the prior administration. So that's driving the ambition and a lot of the transactional activity we're seeing today. And unless and until the administration acts in ways that are unforeseen, I think that trend will continue. And it's not just the types of deals that are going to be allowed. It's the types of flexibility around remedies and being more accommodative towards solutions to potential problems. And again, this is in the U.S. So we'll see what happens outside the United States, a different regulatory scheme. But clearly, in the U.S., it feels like everyone in the ecosystem is assuming that many things are now possible that weren't possible before. In terms of deregulation generally, I think that has added to the risk on environment and the feeling that our economy is going to continue to grow and there is a premium for growth and people need to invest in growth and future opportunities. And I think that's sort of adding a little bit of fuel to the fire, both in terms of where the stock market is, which obviously helps dealmaking activity, where the financing markets are. All of those corroborate enhanced deal making.
James Yaro: Yes. Okay. That makes sense. So you're obviously investing in building out the secondaries business. So you clearly have a view on the importance of this offering. But just I'd love to get your perspective on how you think about the right mix of secondaries versus regular way in terms of historical context, sponsor exits, i.e., IPOs and M&A in a more normal backdrop for sponsor activity that at some point will be here?
Navid Mahmoodzadegan: Yes. So I think the GP-led secondaries, the continuation vehicles, which is kind of the first part of the PCA business that we're investing in, I think that, that product is here to stay for a long time. I think irrespective of whether or not the M&A market is open or the IPO market is open, there's going to be a category of company and a category of sponsor that -- where the sponsors look at that company and say, I have more to add to this business. I see more upside in this business longer term. I want to continue to own and manage this business or this set of businesses. And yes, I need to get some return back to some of my investors who need liquidity, but I'm not prepared to sell this company yet and I'm not prepared to take it public yet. And so we think there's a permanence to the CV product that isn't directly tied to how healthy the M&A market is or how healthy the IPO market is. Clearly, there are some categories of transactions maybe over the last couple of years where one of the primary drivers was, hey, you can't sell the company right now or you can't take it public right now, and we got to get liquidity. But I think there's a much broader category of situation that is going to be around for a long time, which is why we're investing so heavily in that product. As it relates to the IPO market, look, I love the healthy IPO market. I think it's good for the M&A market. I think sponsors getting a return, whether it's through the M&A market or the IPO market is good for deal making. It's good to increase confidence in putting more money out and buying more companies and investing in more things. I think those things come together. I don't view it as if the IPO market is healthy, it takes away from the M&A market. I think these markets work very much together in terms of kind of creating a positive capital cycle.
Operator: Your next question comes from the line of Ryan Kenny with Morgan Stanley.
Ryan Kenny: I wanted to follow up on the regulation comment. So clearly, it's a more supportive environment. And my question is, when you talk to your corporate clients, are they hearing and feeling that message similarly? And is there any nuance in regulation that we should think about in certain industries like technology? Do you need to see a few deals in each industry get approved first before others get comfortable moving? Any thoughts there, maybe industry by industry would be helpful.
Navid Mahmoodzadegan: Yes. Look, I think you rightly point out that against this backdrop of a more accommodative antitrust or regulatory backdrop, there are definitely nuances as it relates to certain types of cross-border deals, economic companies that are have security sensitivities, CFIUS and other issues like that. You're seeing some noise around certain types of media companies, right, and what's approvable and what may not be approvable. So I think there are idiosyncrasies in some of these sectors. But I think generally, putting aside some of those idiosyncrasies in some of the sectors, the overall thrust is a much more accommodative thrust. But you're right to point out that it's not -- there are elements in some of these sectors given the political landscape that create some nuance.
Ryan Kenny: And then just a follow-up separately. In the quarter, there was the $19.1 million benefit to revenues from the gain on Moelis Australia. Can you just unpack what drove that? And should we expect more share sales ahead?
Christopher Callesano: Yes. We booked a gain of $19 million as a result of, like you said, selling the shares in MA Financial Group. That was our Australian JV when they went public or they went public on ASX back in 2017. So we were thinking owning the shares or equity in MA Financial is not a strategic investment for us. However, maintaining that partnership and alliance with them is what's strategic. So as a result, from time to time, we sell down a portion of those shares and as we've done historically, we reclassified that gain from other income to revenues. And the rationale for that is many of our investment bankers, Moelis bankers worked on helping build this business over the years. And as a result, we consider these gains equivalent to revenues. So we do still have some investment, and it is possible from time to time periodically. Last time we did it was a year ago at this time, we will sell some additional shares down. But again, the important thing is we continue with that strategic alliance with MA Financial.
Operator: Your next question comes from the line of Brennan Hawken with BMO Capital Markets.
Brennan Hawken: I'd like to follow up on that Moelis Australia question. So you said that you had reclassified the revenue from other income to adjusted revenue and that, that movement was EPS neutral. That EPS neutral clause, does that just applies to the reclassification of revenue, not the impact of the gain, right?
Christopher Callesano: Yes. We reclassify it. So the gain is $19 million. It's booked in other income, and we reclassify it to revenues. That's right.
Brennan Hawken: Got it. Got it. Okay. Were there any expenses tied to that gain? Like did that impact the comp ratio? Should we back that out of the adjusted revenue to think about what a sort of core comp ratio is? Can you maybe help us understand how that gain might impact the expenses?
Christopher Callesano: Yes. I mean, I think, again, like I said, our rationale is bankers do work on this, right? So we've built this business over the years. And for the evaluation of comp purposes, we do reward people for their contribution to this value creation. So we don't book. They're an equity method investment, right? So we just pick up below the line any of their P&L, and we don't receive that portion or a portion of their revenue. So as a result, we just wait until we have a realized gain and we take that realized gain and we book it to revenues.
Brennan Hawken: Got it. Okay. And then on the MD count, it looks like that's down by 3 quarter-over-quarter. And you did have a -- it looks like you had a $6.5 million benefit from comp forfeiture. I know that there was a sort of senior person who left in restructuring, but was there sort of more elevated churn here this quarter, which led to that? Or was that just sort of a single isolated incident? Or have you been more actively managing or refocusing the talent pool? Any color on that would be great.
Navid Mahmoodzadegan: Yes. If you kind of look year-over-year, I think our MD count has gone from 157 at this point last year to 170 today. And when you look at that, that's the increase, the gross number of MDs is roughly split kind of half and half between internal promotes and external hiring. There have been some levers in that, which is what gets you to your kind of net adds of, call it, 13 over the last 12 months. But it's -- again, as I said, a combination of internal promotes and external hiring that makes the difference.
Christopher Callesano: Yes. And those forfeitures, right, of compensation. So it really depends, right? So it is ex-employees. It could be competing or other reasons. Sometimes they're booked to other income for GAAP purposes. Sometimes they're not. Sometimes they're just credited directly to compensation. So we just reclassify it to compensation. That's where we think it belongs, and that's where the expense was originally booked. So that's why we do that reclassification. It really just depends on how GAAP books it.
Brennan Hawken: Okay. So it's not necessarily an indication that there was -- anything was elevated here this quarter?
Christopher Callesano: No, no, not at all.
Operator: Your next question comes from the line of Brendan O'Brien with Wolfe Advisors.
Brendan O'Brien: To start, I just wanted to follow up on Ken's first question on the restructuring outlook earlier and maybe drill down more specifically to your business. You did a good job outlining some of the bigger concerns on the credit side, but at the same time, the Fed lowering rates should help to alleviate some of the stresses put on corporate balance sheets. And so just given these puts and takes, I just wanted to get a sense as to how you're thinking about the outlook for this business, both in 4Q and into 2026.
Navid Mahmoodzadegan: Sure. Look, we -- as I think you all know, we have an outstanding practice in CSA and restructuring, a great team that's been successful for a long time and continues to be successful. We are seeing more muted level, to your point, around ample Capital Markets, good economy. We are seeing less new origination of business than we saw a year ago. I remind everybody that last year was a record year for our CSA business, up 30% over the year prior. And so I think we've sort of outlined that business was unlikely to be flat this year, likely to be down a little bit. And part of that is the market environment and part of it is a tough comp over last year.
Brendan O'Brien: That's helpful color. And then just drilling down a bit more on the sponsor side and specifically exits. Obviously, that's been a big area of focus over the past few years. But with the IPO market reopening, one of your peers citing a notable uptick in bake-offs and the secondary market already eclipsing last year's record level. It feels like exit activity has really taking a step function higher. Just want to get a sense as to what you're seeing or hearing from sponsors on the outlook for exits and if you're seeing any signs of activity on the exit side, in particular, broadening out beyond the highest quality assets.
Navid Mahmoodzadegan: Yes. Look, I think we said that in our remarks and in one of the other questions. We're definitely seeing the broadening. I think that's kind of what's been missing is kind of just the heavy volume of middle market activity, and we think that's coming. We're seeing signs of that already. Our engagement level, dialogue level, pitch activity in our sponsor universe is very high. So our outlook for that business is good and getting better. And I do think as you kind of roll forward here into 2026, there's likely to be further improvement in the overall level of sponsor activity. We're definitely seeing that as well. Again, supported by ample financing, pent-up demand and need for sponsors to get liquidity. The fact that there's an active -- more active strategic environment now helps, too, because sometimes those businesses are sold to strategics and not sponsors. And you're seeing it on take privates, some large-scale take privates here recently. So there's more take private activity as sponsors look at companies that are better off in the private markets. We're seeing it with holdco financings. We're seeing it with CVs. And so there is a lot of activity around sponsors these days, and we're really well positioned to capitalize on given that, that's been a fundamental and important business for us since the beginning of Moelis & Company.
Operator: Your next question comes from the line of Alex Bond with KBW.
Alexander Bond: Now that we're a decent way through the fourth quarter, just wondering if you could share how you're starting to think about the pace of your hiring activity in 2026 relative to this year. Maybe assuming we continue to see a gradual improvement in M&A volume, should we expect hiring to be at a similar level next year relative to this year? And then also just maybe how you're thinking about the hiring trajectory specifically for the PCA business?
Navid Mahmoodzadegan: Sure. Thank you for the question. Yes, look, we're -- we still have -- as I mentioned, we hired 5 people this quarter, 5 MDs this quarter, 10 for the year. We have a number of active dialogues that we're trying to get over the finish line today. And as you know, recruiting is a 365 year-round affair. And our focus is on building out PCA, as you mentioned, that's a really important strategic priority for us to make sure we get that team built out fully because we think there's a significant opportunity to go take advantage of. And we're focused on other big TAMs where we're still light on coverage or where there's still white area that we can fill in and go after big opportunities. So hiring continues to be a very important priority. We have lots of great conversations happening and a lot of focus on trying to convert those and have people join us. The hiring activity that we've had over the last 3 or 4 years has been really spectacular. The success we've seen in Capital Markets and oil and gas and tech and the early signs in PCA have just given us a lot of confidence to continue to attack the hiring opportunity and continue to grow the franchise. Obviously, we want to do that in a prudent way. We want to do that in a way that's consistent with our culture that's critical. And we want to bring in people on the platform that can really thrive as partners of the firm.
Operator: Your next question comes from the line of Nathan Stein with Deutsche Bank.
Nathan Stein: I wanted to ask a bigger picture question. So the group sold off today, early this afternoon after the Fed comments came out. Do you guys -- how do you guys think about maybe the change in the marketplace just given the Fed comments today?
Navid Mahmoodzadegan: Look, as I said, I don't -- you can always sort of impute go-forward market activity based on perceptions of interest rates and where interest rates are going. And clearly, that's a variable in transactional activity, but it's not the only variable in transaction activity. As I said before, the need for strategic acquirers to get scale, efficiencies and position themselves well for technology change, the need for requirement for sponsors to return capital and keep that return of capital and deployment cycle going, all of those things are driving a lot of what's happening in the M&A market. Cost of money is a variable. And clearly, low interest rates and ample credit is a positive to the marketplace, but it's not the only variable. And so I don't read the market commentary is -- the Fed commentary is fundamentally changing our outlook for the business. We'll see what rolls forward, but I don't believe it's going to fundamentally change the direction of travel and what we're seeing in terms of demand in the environment for transactions.
Nathan Stein: Great. And then if I could just ask a follow-up on pipelines in general. across different sectors. You guys have done a lot to build out your tech offering in the last few years. So maybe just talk about your M&A -- let's just say, M&A deal pipelines within tech and any other sectors you'd like to highlight?
Navid Mahmoodzadegan: I was sitting down to look through our different sectors to get ready for this call and anticipating someone would ask the question of what sectors are hot and what aren't. And what I saw in our activity levels and our pipelines was pretty good broad-based strength across most, if not all, of our sectors. Certainly, tech is at the top of the list in terms of where we're seeing a lot of activity. But we're also seeing a lot of activity in parts of health care and industrials and in sports media and entertainment and the world of data centers and AI and digital infrastructure. And we're seeing it, I'll say, pretty much across the board in terms of industries where we're seeing activity, M&A pipeline building, et cetera, et cetera. So I wouldn't want to suggest it's narrow. It's pretty broad-based. Is there a follow-up?
Operator: That concludes our question-and-answer session. I will now turn the call back over to Navid for closing remarks.
Navid Mahmoodzadegan: Great. Well, thanks, everybody. Really appreciate your time today, and we look forward to seeing you all again soon. Thanks so much.
Operator: Ladies and gentlemen, this concludes today's call. Thank you all for joining. You may now disconnect.