Lazard reported a 91% fall in second-quarter profit, underscoring how uneven the recovery in financial advisory work remains even as capital markets have reopened in parts of the global economy. Net income fell to $5 million, or 3 cents per share, from $55 million, or 52 cents per share, a year earlier.
The decline was driven by an elevated tax rate and weaker revenue in financial advisory, Lazard's core investment banking business. The result contrasts with a broader market in which trading desks and some underwriting businesses have benefited from volatility, stronger equity issuance and renewed corporate activity.
Management is responding with a deeper reshaping of the advisory franchise. Lazard said it had eliminated more than 80 managing director roles, around 40% of that pool, while planning to hire bankers in higher-growth areas such as healthcare, industrials and defense technology.
Asset management offered a counterweight. Revenue in that division rose 23%, helped by record inflows, and assets under management increased to $285 billion from $248 billion a year earlier. That performance helped adjusted revenue rise 2% to $786 million, above market expectations.
The strategic question is whether Lazard can convert the restructuring into stronger advisory fees by 2027, as management expects. For investors, the quarter shows a firm with a valuable asset-management base but a deal-advisory franchise still exposed to tax effects, sector mix and uneven transaction demand.
