Jefferies Financial Group Inc

Previous wording

•Earnings from continuing operations before income taxes were $227.8 million, compared with $17.9 million for the prior year comparable quarter.

Current wording

•Earnings from continuing operations before income taxes were $252.7 million, compared with $91.1 million for the prior year quarter.

Previous wording

•Asset management recognized net revenues were $156.5 million, compared with negative net revenues of $(30.9) million in the prior year comparable quarter. Other investments net revenues for the quarter meaningfully increased largely due to the inclusion of Stratos and Tessellis in our overall results as these entities became consolidated subsidiaries in the fourth quarter of 2023. Asset management fees and investment return revenues were largely flat compared to the prior year quarter.

Current wording

•Asset management net revenues were $59.0 million, compared with net revenues of $10.1 million in the prior year quarter. Other investments net revenues for the current quarter meaningfully increased largely due to the inclusion of Stratos and Tessellis in our overall results as these entities became consolidated subsidiaries in the fourth quarter of 2023. Investment return revenues decreased from the prior year quarter as the market environment for certain of our strategies proved challenging during the current quarter.

Previous wording

•Compensation and benefits expense was $862.0 million, an increase of 49.7% compared with $575.9 million for the prior year comparable quarter. Compensation and benefits expense as a percentage of Net revenues was 52.0%, compared with 55.5% for the prior year comparable quarter. The ratio for the current quarter was impacted by the consolidation of Stratos and Tessellis, which have lower compensation ratios.

Current wording

•Compensation and benefits expense was $889.1 million, an increase of 38.0% compared with $644.1 million for the prior year quarter. Compensation and benefits expense as a percentage of Net revenues was 52.8%, compared with 54.5% for the prior year quarter. The ratio for the current quarter was impacted by the consolidation of Stratos and Tessellis, which have lower compensation ratios.

Previous wording

•Non-compensation expenses were $566.7 million, an increase of 27.7% compared with $443.8 million for the prior year comparable quarter. Non-compensation expenses were higher due to the inclusion of Tessellis and Stratos as operating subsidiaries following the consolidation of these entities in the fourth quarter of 2023. The increase in non-compensation expenses is also attributed to increased brokerage and clearing fees associated with increased trading volumes and increased technology and communication and business development expenses.

Current wording

•Non-compensation expenses were $541.8 million, an increase of 21.2% compared with $447.0 million for the prior year quarter. Non-compensation expenses were higher due to the inclusion of Tessellis and Stratos as operating subsidiaries following the consolidation of these entities in the fourth quarter of 2023. The increase in non-compensation expenses is also attributed to increased brokerage and clearing fees associated with increased trading volumes, and higher technology and communications and business development expenses.

Previous wording

•Earnings from continuing operations before income taxes were $448.0 million, compared with $175.9 million for the prior year comparable period.

Current wording

•Earnings from continuing operations before income taxes were $700.7 million, compared with $267.0 million for the prior year period.

Previous wording

•Our overall results were strong for the current period, although we were negatively impacted by losses associated with our investment in Weiss Multi-Strategy Advisers (“Weiss”) resulting in a pre-tax loss to us of $56.7 million, $30.7 million of which reduced our net revenues and $26.2 million of which increased our non-compensation expenses.

Current wording

•Our overall results were strong for the current period, reflecting strong performance and continued momentum in Investment Banking. Additionally, our results include the impact of losses associated with our investment in Weiss Multi-Strategy Advisers (“Weiss”) resulting in a pre-tax loss to us of $57.2 million, $30.6 million of which reduced our net revenues and $26.2 million of which increased our non-compensation expenses.

Previous wording

•Investment banking net revenues were $1.54 billion, compared with $1.07 billion in the prior year comparable period. Advisory revenues were $622.5 million, up 12.9% compared with $551.3 million for the prior year comparable period, attributable primarily to market share gains. Total underwriting net revenues of $793.2 million were 78.7% higher than the prior year comparable period of $443.9 million, due to increased equity and debt underwriting activity as a result of more robust equity and general capital markets environment as well as market share gains from the expanded capabilities and reach of our larger investment banking team.

Current wording

•Investment banking net revenues were $2.49 billion, up 45.6% compared with $1.71 billion in the prior year period. Advisory revenues were $1.21 billion, up 37.0% compared with $886.6 million for the prior year period, attributable primarily to market share gains. Total underwriting net revenues of $1.13 billion were 58.9% higher than the prior year period of $708.9 million, due to increased equity and debt underwriting activity as a result of a more robust equity and general capital markets environment.

Previous wording

•Equities net revenues of $766.2 million were 31.2% higher compared to $584.0 million of the prior year comparable period, as increased volumes and more favorable trading opportunities drove strong results across most of our equities business lines.

Current wording

•Equities net revenues of $1.15 billion were 34.7% higher compared to $852.0 million of the prior year period, as increased volumes and more favorable trading opportunities drove stronger results across most of our equities business lines.

Previous wording

•Fixed income net revenues were $284.2 million, compared to $278.4 million for the prior year quarter, as a more stable interest rate environment led to muted credit and interest rate volatility resulting in lower overall volumes. Revenues from our securitized markets business were particularly strong on an opening of the securitization market, partially offset by reduced activity in our global structured solutions business and less favorable results from our U.S. rates and credit trading businesses.

Current wording

•Fixed income net revenues of $925.8 million were 4.9% higher compared to $883.0 million for the prior year period, driven by stronger results from our distressed trading and securitized markets businesses, partially offset by reduced activity in our global structured solutions business and less favorable results across our emerging markets and municipal securities businesses, which were particularly strong in the prior year period.

Previous wording

•Asset management recognized net revenues were $429.9 million, compared with $37.6 million in the prior year comparable period. Investment return was significantly higher on improved performance across multiple investment strategies, partially offset by $30.7 million of revenue losses associated with our investment in Weiss. Other investments net revenues for the quarter were meaningfully higher than the prior year comparable quarter largely due to the inclusion of Stratos and Tessellis in our overall results as these entities became consolidated subsidiaries in the fourth quarter of 2023.

Current wording

•Asset management net revenues were $488.9 million, compared to $47.7 million in the prior year period. Investment return was higher on improved performance across multiple investment strategies, partially offset by $30.6 million of revenue losses associated with our investment in Weiss. Other investments net revenues for the current year were meaningfully higher than the prior year period largely due to the inclusion of Stratos and Tessellis in our overall results as these entities became consolidated subsidiaries in the fourth quarter of 2023.

Previous wording

•Compensation and benefits expense was $1.79 billion, an increase of 39.9% compared with $1.28 billion for the prior year comparable period. Compensation and benefits expense as a percentage of Net revenues was 52.7%, compared with 55.1% for the prior year comparable period. The ratio for the current period was impacted by the consolidation of Stratos and Tessellis, which have lower compensation ratios.

Current wording

•Compensation and benefits expense was $2.68 billion, an increase of 39.3% compared with $1.92 billion for the prior year period. Compensation and benefits expense as a percentage of Net revenues was 52.7%, compared with 54.9% for the prior year period. The ratio for the current period was impacted by the consolidation of Stratos and Tessellis, which have lower compensation ratios.

Previous wording

•Non-compensation expenses were $1.16 billion, an increase of 33.7% compared with $866.2 million for the prior year comparable period. Non-compensation expenses were higher due to the inclusion of Tessellis and Stratos as operating subsidiaries following the consolidation of these entities in the fourth quarter of 2023, offset by the impact of the spin-off of Vitesse Energy in January 2023. The increase in non-compensation expenses is also attributed to increased brokerage and clearing fees associated with increased trading volumes and increased technology and communication and business development expenses. Other expenses include bad debt expenses largely related to our losses associated with Weiss Strategy Advisers upon its shutdown in the first quarter of 2024.

Current wording

•Non-compensation expenses were $1.70 billion, an increase of 29.4% compared with $1.31 billion for the prior year period. Non-compensation expenses were higher due to the inclusion of Tessellis and Stratos as operating subsidiaries following the consolidation of these entities in the fourth quarter of 2023, offset by the impact of the spin-off of Vitesse Energy in January 2023. The increase in non-compensation expenses is also attributed to increased brokerage and clearing fees associated with increased trading volumes and technology and communication and business development expenses. Other expenses include bad debt expenses largely related to our losses associated with Weiss Strategy Advisers upon its shutdown in the first quarter of 2024.

Previous wording

•At May 31, 2024, we had 7,611 employees globally across all of our consolidated subsidiaries within our Investment Banking and Capital Markets and Asset Management reportable segments, an increase of 2,276 employees from our headcount of 5,335 at May 31, 2023. Included within our global headcount are 2,176 employees of our Stratos, Tessellis, HomeFed, and M Science subsidiaries. Of the 2,276 headcount increase, 1,976 relates to recognizing control of Stratos and Tessellis since the fourth quarter of 2023 as the employees of these subsidiaries are now included in our overall headcount. During the past year, we have increased the number of our Investment Banking Managing Directors and related staff, along with additional technology and corporate staff to support our growth and strategic priorities.

Current wording

•At August 31, 2024, we had 7,624 employees globally across all of our consolidated subsidiaries within our Investment Banking and Capital Markets and Asset Management reportable segments, an increase of 2,119 employees from our headcount of 5,505 at August 31, 2023. Included within our global headcount are 1,907 employees of our Stratos, Tessellis, HomeFed, and M Science subsidiaries. Of the 2,119 headcount increase, 1,698 relates to recognizing control of Stratos and Tessellis since the fourth quarter of 2023 as the employees of these subsidiaries are now included in our overall headcount. During the past year, we have increased the number of our Investment Banking Managing Directors and related staff, along with additional technology and corporate staff to support our growth and strategic priorities.

Previous wording

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 the net interest revenue or expense associated with the respective activities, 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. During 2023, we refined our allocated net interest methodology to better reflect net interest expense across our business units based on use of capital. Historical periods have been recast to conform with the revised methodology.

Current wording

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 the net interest revenue or expense associated with the respective activities, 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.

Previous wording

•Foursight, our wholly-owned subsidiary engaged in the lending and servicing of automobile loans (until the sale of our interest in April 2024); and

Current wording

•Foursight, our wholly-owned subsidiary engaged in the lending and servicing of automobile loans (until the sale of our interest in April 2024);

Previous wording

Investment banking revenues were $803.2 million, up 59.4% compared with $503.9 million for the prior year comparable quarter. We have made extensive investments in our investment banking business, particularly enhancing our capabilities across sectors and regions which has led to market share gains.

Current wording

Investment banking net revenues were $949.5 million, up 47.3% compared with $644.6 million for the prior year quarter. We have made extensive investments in our investment banking business over the past recent periods, enhancing our capabilities across sectors and regions which has led to market share gains.

Previous wording

Advisory revenues were $283.9 million, up 11.7% compared with $254.2 million for the prior year comparable quarter, as the transaction levels increased across most sectors in the global mergers and acquisitions markets and we continued to gain market share.

Current wording

Advisory net revenues of $592.5 million reflect our best quarter on record and was up 76.7% compared with $335.3 million for the prior year quarter, driven by market share gains attributable to an increase in transaction levels across most sectors in the global mergers and acquisitions markets.

Previous wording

Other investment banking net revenues were $64.6 million, notably higher compared with net revenues of $11.5 million for the prior year comparable quarter. Results from our share of the net earnings of our Jefferies Finance joint venture increased from the prior year comparable quarter primarily driven by higher net fee income, partially offset by lower net interest income. Additionally, overall expenses decreased primarily driven by lower provision for loan losses for the current quarter. Revenues from our share of the net earnings of our Berkadia joint venture increased from the prior year comparable quarter, primarily due to an increase in mortgage origination and sales volumes and higher interest income attributable to a larger and growing loan servicing portfolio. In addition, during the three months ended May 31, 2024, we recognized gains on various equity derivative transactions related to our investment banking activities, and a $24.8 million gain from the sale of our interests in Foursight in April 2024.

Current wording

Other investment banking net revenues were $23.8 million, lower compared with net revenues of $44.5 million for the prior year quarter. Results from our share of the net earnings of our Jefferies Finance joint venture increased from the prior year quarter, primarily driven by higher net fee income, partially offset by lower net interest income. Revenues from our share of the net earnings of our Berkadia joint venture decreased from the prior year quarter, primarily due to lower mortgage origination and sales volumes, partially offset by higher interest income and servicing fees attributable to a larger and growing loan servicing portfolio. In addition, during the current quarter, we recognized gains on various equity derivative transactions related to our investment banking activities and revenue from our strategic alliance with SMBC. The current quarter was also impacted by the absence of Foursight due to its sale in April 2024.

Previous wording

Our investment banking backlog continues to strengthen and we continue to see encouraging signs of a further pickup in underwriting and mergers and acquisitions activity for the remainder of 2024 and 2025 based on current trends observed, although execution is always uncertain and dependent on market conditions. As an indicator of net revenues in a given future period, backlog snapshots are subject to limitations. 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 also be modified or cancelled.

Current wording

Our investment banking backlog remains strong heading into year end based on current trends observed, although execution is always uncertain and dependent on market conditions. As an indicator of net revenues in a given future period, backlog snapshots are subject to limitations. 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 also be modified or cancelled.

Previous wording

Investment banking revenues were $1.54 billion, up 44.6% compared with $1.07 billion for the prior year comparable period. We have made extensive investments in our investment banking business, particularly enhancing our capabilities across sectors and regions which has led to market share gains.

Current wording

Investment banking net revenues were $2.49 billion, up 45.6% compared with $1.71 billion for the prior year period. We have made extensive investments in our investment banking business, enhancing our capabilities across sectors and regions which has led to market share gains.

Previous wording

Advisory revenues were $622.5 million, up 12.9% compared with $551.3 million for the prior year comparable period, as transaction levels increased across most sectors in the global mergers and acquisitions markets and we continue to experience market share gains.

Current wording

Advisory net revenues were $1.21 billion, up 37.0% compared with $886.6 million for the prior year period, driven by market share gains attributable to an increase in transaction levels across most sectors in the global mergers and acquisitions markets.

Previous wording

Other investment banking net revenues were $127.2 million, meaningfully higher compared with net revenues of $71.5 million for the prior year comparable period. Results from our share of the net earnings of our Jefferies Finance joint venture increased from the prior year primarily driven by higher net fee income, partially offset by lower net interest income. Additionally, overall expenses decreased primarily driven by lower provision for loan losses for the current year. Revenues from our share of the net earnings of our Berkadia joint venture increased from the prior year comparable period driven by higher interest income on a larger and growing loan servicing portfolio, partially offset by lower loan sales volume. In addition, during the six months ended May 31, 2024, we recognized gains on various equity derivative transactions related to our investment banking activities, and a $24.8 million gain from the sale of our interests in Foursight in April 2024.

Current wording

Other investment banking net revenues were $151.0 million, meaningfully higher compared with net revenues of $116.0 million for the prior year period. Results from our share of the net earnings of our Jefferies Finance joint venture increased from the prior year period primarily driven by higher net fee income, partially offset by lower net interest income. Revenues from our share of the net earnings of our Berkadia joint venture increased from the prior year period driven by higher interest income and servicing fees attributable to a larger and growing loan servicing portfolio, partially offset by lower mortgage origination and sales volumes. In addition, during the current year, we recognized gains on various equity derivative transactions related to our investment banking activities, revenue from our strategic alliance with SMBC and a $24.8 million initial gain from the sale of Foursight in April 2024.

Previous wording

•Fixed income net revenues were $636.7 million, compared to $627.4 million for the prior year comparable period, as stronger debt underwriting activity offset less market volatility. Revenues from our securitized markets and distressed trading businesses generated particularly strong results offset by reduced activity in our global structured solutions business and less favorable results across our municipal securities and emerging markets businesses which were particularly strong in the prior year period.

Current wording

•Fixed income net revenues were $925.8 million, up 4.9% compared to $883.0 million for the prior year period, driven by stronger results from our distressed trading and securitized markets businesses, partially offset by reduced activity in our global structured solutions business and less favorable results across our emerging markets and municipal securities businesses which were particularly strong in the prior year period.

Previous wording

•revenues from investments held in our other investments portfolio, including consolidated operations from real estate development activities, foreign exchange trading (Stratos consolidated beginning in the fourth quarter of 2023) and telecommunications activities (OpNet consolidated beginning in the fourth quarter of 2023). Prior periods include revenues from oil and gas activities until the spin-off of our interest in Vitesse Energy in January 2023.

Current wording

•revenues from investments held in our other investments portfolio, including consolidated operations from real estate development activities, foreign exchange trading (Stratos consolidated from the beginning of the fourth quarter of 2023) and telecommunications activities (OpNet consolidated from the beginning of the fourth quarter of 2023 through its sale on in August 2024). Prior periods include revenues from oil and gas activities until the spin-off of our interest in Vitesse Energy in January 2023.

Previous wording

Asset management fees and revenues were $16.8 million, modestly higher from $15.9 million for the prior year comparable quarter, reflecting higher management fees on funds managed by us offset by lower revenue earned through our strategic affiliates.

Current wording

Asset management fees and revenues were $13.3 million, lower from $16.4 million for the prior year quarter, reflecting higher management fees on funds managed by us offset by lower revenue earned through our strategic affiliates.

Previous wording

Other investments net revenues were $122.8 million, compared with negative net revenues of $(66.2) million in the prior year comparable quarter, with the increase primarily driven by the consolidation of Stratos and Tessellis in the fourth quarter of 2023 as well as net gains from investment positions.

Current wording

Other investments net revenues were $101.9 million, compared with negative net revenues of $(25.1) million in the prior year quarter, with the increase primarily driven by the consolidation of Stratos and Tessellis in the fourth quarter of 2023. Additionally, during the third quarter of 2024, Other investments net revenues include net gains on investment positions compared to unrealized losses on certain positions due to fair value write-downs recognized in the prior year quarter.

Previous wording

Our overall results were strong for the current period, although we were negatively impacted by losses associated with our investment in Weiss resulting in a pre-tax loss to us of $56.7 million, $30.7 million of which reduced our net revenues and $26.2 million of which increased our non-compensation expenses.

Current wording

Our overall results were strong for the current period, and includes losses associated with our investment in Weiss, which reduced our asset management net revenues by $30.6 million.

Previous wording

Asset management fees and revenues were $76.5 million, compared with $58.6 million for the prior year, reflecting higher management and performance fees on funds managed by us and an increase in performance and similar fees and revenues earned through our strategic affiliates, partially offset by lower management fees earned through our strategic affiliates.

Current wording

Asset management fees and revenues were $89.7 million, compared with $75.0 million for the prior year period, reflecting higher management and performance fees on funds managed by us, while increases in revenues on certain strategic affiliate strategies were largely offset by declines in revenues from other strategic affiliates.

Previous wording

Investment return was $150.6 million, compared with $59.9 million for the prior year comparable period, with the increase driven by improved returns generated across multiple fund strategies, partially offset by losses of $30.7 million associated with our investment in Weiss.

Current wording

Investment return was $110.4 million, compared with $91.6 million for the prior year period, with the increase driven by improved returns generated across multiple fund strategies, partially offset by losses of $30.6 million associated with our investment in Weiss.

Previous wording

Other investments net revenues were $233.9 million, compared with negative net revenues of $(58.8) million in the prior year comparable period, with the increase primarily driven by the consolidation of Stratos and Tessellis in the fourth quarter of 2023, partially offset by the spin-off of Vitesse Energy in January 2023 as well as net gains from investment positions.

Current wording

Other investments net revenues were $335.8 million, compared with negative net revenues of $(83.9) million in the prior year period, with the increase primarily driven by the consolidation of Stratos and Tessellis in the fourth quarter of 2023, partially offset by the spin-off of Vitesse Energy in January 2023. Additionally, during the current year, Other investments net revenues include net gains on investment positions compared to unrealized losses on certain positions due to fair value write-downs recognized in the prior year period.

Previous wording

We and our affiliated asset managers have aggregate net asset values or net asset value equivalent assets under management of $24.3 billion and $28.0 billion at May 31, 2024 and November 30, 2023, respectively. Net asset value or net asset value equivalent assets under management are composed of the fair value of the net assets of a fund or the net capital invested in a separately managed account. These include the following:

Current wording

We and our affiliated asset managers have aggregate net asset values or net asset value equivalent assets under management of $24.7 billion and $28.0 billion at August 31, 2024 and November 30, 2023, respectively. Net asset value or net asset value equivalent assets under management are composed of the fair value of the net assets of a fund or the net capital invested in a separately managed account. These include the following:

Previous wording

•Net asset values of investments made by us in funds or separately managed accounts were approximately $3.7 billion at May 31, 2024 and approximately $3.5 billion at November 30, 2023. We invest in certain strategies using our own capital, often before opening a strategy to outside capital. The net asset values include our capital of $1.7 billion at May 31, 2024 and $1.8 billion at November 30, 2023 plus amounts financed of $2.0 billion at May 31, 2024 and $1.8 billion at November 30, 2023. Revenues related to the investments made by us are presented in Investment return within the results of our asset management business.

Current wording

•Net asset values of investments made by us in funds or separately managed accounts were approximately $3.7 billion at August 31, 2024 and approximately $3.5 billion at November 30, 2023. We invest in certain strategies using our own capital, often before opening a strategy to outside capital. The net asset values include our capital of $1.8 billion for both August 31, 2024 and November 30, 2023 plus amounts financed of $2.0 billion at August 31, 2024 and $1.8 billion at November 30, 2023. Revenues related to the investments made by us are presented in Investment return within the results of our asset management business.

Previous wording

•Assets under management by affiliated asset managers with whom we have an ongoing profit or revenue sharing arrangement were $18.2 billion at May 31, 2024 and $22.4 billion at November 30, 2023. Revenues from our share of fees received by affiliated asset managers are presented in Revenue from strategic affiliates within the results of our asset management businesses.

Current wording

•Assets under management by affiliated asset managers with whom we have an ongoing profit or revenue sharing arrangement were $18.5 billion at August 31, 2024 and $22.4 billion at November 30, 2023. Revenues from our share of fees received by affiliated asset managers are presented in Revenue from strategic affiliates within the results of our asset management businesses.

Previous wording

•Third-party investments actively managed by our wholly-owned managers were $2.4 billion at May 31, 2024 and $2.1 billion at November 30, 2023. We earn asset management fees as a result of the third-party investments, which are presented in Asset management fees and revenues within the results of our asset management businesses.

Current wording

•Third-party investments actively managed by our wholly-owned managers were approximately $2.5 billion at August 31, 2024 and $2.1 billion at November 30, 2023. We earn asset management fees as a result of the third-party investments, which are presented in Asset management fees and revenues within the results of our asset management businesses.

Previous wording

(1)Due to the level or nature of an investment in a fund, we may consolidate that fund; and accordingly, the assets and liabilities of the fund are included in the representative line items in our consolidated financial statements. At May 31, 2024 and November 30, 2023, $10.7 million and $11.9 million, respectively, represent net investments in funds that have been consolidated in our financial statements.

Current wording

(1)Due to the level or nature of an investment in a fund, we may consolidate that fund; and accordingly, the assets and liabilities of the fund are included in the representative line items in our consolidated financial statements. At August 31, 2024 and November 30, 2023, $10.3 million and $11.9 million, respectively, represent net investments in funds that have been consolidated in our financial statements.

Previous wording

Non-interest expenses were $1.43 billion, an increase of 40.1%, compared with $1.02 billion for the prior year comparable quarter. The increase is primarily due to an increase in overall business activity and compensation expense. Non-compensation expenses are higher due to the inclusion of Tessellis and Stratos as operating subsidiaries following the consolidation of these entities in the fourth quarter of 2023.

Current wording

Non-interest expenses were $1.43 billion, an increase of 31.1%, compared with $1.09 billion for the prior year quarter, primarily due to an increase in overall business activity and compensation expense. Non-compensation expenses are also higher due to the inclusion of Tessellis and Stratos as operating subsidiaries following the consolidation of these entities in the fourth quarter of 2023.

Previous wording

Non-interest expenses were $2.95 billion, an increase of 37.4%, compared with $2.15 billion for the prior year comparable period. The increase is primarily due to an increase in overall business activity and compensation expense. Non-compensation expenses are impacted by the inclusion of Tessellis and Stratos as operating subsidiaries following the consolidation of these entities in the fourth quarter of 2023, partially offset by the impact of the spin-off of Vitesse Energy in January 2023.

Current wording

Non-interest expenses were $4.38 billion, an increase of 35.3%, compared with $3.24 billion for the prior year period, primarily due to an increase in overall business activity and compensation expense. Non-compensation expenses are also impacted by the inclusion of Tessellis and Stratos as operating subsidiaries following the consolidation of these entities in the fourth quarter of 2023, partially offset by the impact of the spin-off of Vitesse Energy in January 2023.

Previous wording

Compensation and benefits expense was $862.0 million and $1.79 billion for the three and six months ended May 31, 2024, respectively, compared with $575.9 million and $1.28 billion for the three and six months ended May 31, 2023, respectively. A significant portion of our compensation expense is highly variable with net revenues. Compensation and benefits expense as a percentage of Net revenues was 52.0% and 52.7% for the three and six months ended May 31, 2024, respectively, compared with 55.5% and 55.1% for the three and six months ended May 31, 2023, respectively. The ratio for the current period was impacted by the consolidation of Stratos and Tessellis, which have much lower compensation rates proportionate to net revenues.

Current wording

Compensation and benefits expense was $889.1 million and $2.68 billion for the three and nine months ended August 31, 2024, respectively, compared with $644.1 million and $1.92 billion for the three and nine months ended August 31, 2023, respectively. A significant portion of our compensation expense is highly variable with net revenues. Compensation and benefits expense as a percentage of Net revenues was 52.8% and 52.7% for the three and nine months ended August 31, 2024, respectively, compared with 54.5% and 54.9% for the three and nine months ended August 31, 2023, respectively. The ratio for the current period was impacted by the consolidation of Stratos and Tessellis, which have much lower compensation rates proportionate to net revenues.

Previous wording

Compensation expense related to the amortization of share- and cash-based awards was $118.6 million and $246.7 million for the three and six months ended May 31, 2024, respectively, compared with $65.4 million and $146.7 million for the three and six months ended May 31, 2023, respectively.

Current wording

Compensation expense related to the amortization of share- and cash-based awards was $117.1 million and $363.7 million for the three and nine months ended August 31, 2024, respectively, compared with $73.2 million and $219.9 million for the three and nine months ended August 31, 2023, respectively.

Previous wording

At May 31, 2024, we had 7,611 employees globally across all of our consolidated subsidiaries within our Investment Banking and Capital Markets and Asset Management reportable segments, an increase of 2,276 employees from our headcount of 5,335 at May 31, 2023. Included within our global headcount are 2,176 employees of our Stratos, Tessellis, HomeFed, and M Science subsidiaries. Of the 2,276 headcount increase, 1,976 relates to recognizing control of Stratros and Tessellis during the fourth quarter of 2023 as the employees of those subsidiaries are now included in our overall headcount. During the past year, we have increased the number of our Investment Banking Managing Directors and related staff, along with additional technology and corporate staff to support our growth and strategic priorities.

Current wording

At August 31, 2024, we had 7,624 employees globally across all of our consolidated subsidiaries within our Investment Banking and Capital Markets and Asset Management reportable segments, an increase of 2,119 employees from our headcount of 5,505 at August 31, 2023. Included within our global headcount are 1,907 employees of our Stratos, Tessellis, HomeFed, and M Science subsidiaries. Of the 2,119 headcount increase, 1,698 relates to recognizing control of Stratos and Tessellis during the fourth quarter of 2023 as the employees of those subsidiaries are now included in our overall headcount. During the past year, we have increased the number of our Investment Banking Managing Directors and related staff, along with additional technology and corporate staff to support our growth and strategic priorities.