PIPER SANDLER COMPANIES

Non-interest expenses on a U.S. GAAP basis were $1.16 billion for the nine months ended September 30, 2026, compared to $1.05 billion in the prior-year period. For the nine months ended September 30, 2026, adjusted non-interest expenses were $1.13 billion, compared with $1.01 billion for the nine months ended September 30, 2025. The variance explanations for non-interest expenses and adjusted non-interest expenses are consistent on both a U.S. GAAP and non-GAAP basis unless stated otherwise. See "Explanation and Reconciliation of Non-GAAP Financial Measures" for a detailed explanation of the adjustments made to the corresponding U.S. GAAP measures and a reconciliation of U.S. GAAP to adjusted, non-GAAP financial information.

Compensation and Benefits

For the nine months ended September 30, 2026, compensation and benefits expenses increased 12.0 percent to $891.4 million, compared with $795.6 million in the corresponding period of 2025. Compensation and benefits expenses as a percentage of net revenues decreased to 63.1 percent for the nine months ended September 30, 2026, compared to 64.5 percent for the nine months ended September 30, 2025, primarily due to higher net revenues, including investment income on our investments and the noncontrolling interests in the alternative asset management funds that we manage compared to an investment loss in the corresponding period of 2025. Our adjusted compensation ratio decreased to 61.5 percent in 2026, compared with 62.0 percent in 2025, primarily due to higher adjusted net revenues.

Outside Services

Outside services expenses decreased 6.0 percent to $47.9 million for the nine months ended September 30, 2026, compared with $51.0 million in the corresponding period of 2025, primarily due to lower professional fees.

Restructuring and Integration Costs

For the nine months ended September 30, 2025, we incurred restructuring and integration costs of $6.0 million. The expenses principally consisted of $2.8 million of severance benefits related to headcount reductions, $1.8 million for vacated leased office space associated with our acquisition of Aviditi Advisors, as well as $1.4 million of integration costs related to our acquisition of G Squared.

Other Operating Expenses

For the nine months ended September 30, 2026, other operating expenses were $43.5 million, compared with $32.4 million in the corresponding period of 2025. Other operating expenses for the first nine months of 2026 included $8.5 million in litigation-related expenses.