STIFEL FINANCIAL CORP (SF)

Executive Summary

We operate as a financial services and bank holding company. We have built a diversified business serving private clients, institutional investors, and investment banking clients located across the U.S., Europe, and Canada. Our principal activities are: (i) private client services, including securities transaction and financial planning services; (ii) institutional equity and fixed income sales, trading and research, and municipal finance; (iii) investment banking services, including mergers and acquisitions, public offerings, and private placements; and (iv) retail and commercial banking, including personal and commercial lending programs.

Our core philosophy is based upon a tradition of trust, understanding, and studied advice. We attract and retain experienced professionals by fostering a culture of entrepreneurial, long-term thinking. We provide our private, institutional and corporate clients quality, personalized service, with the theory that if we place clients’ needs first, both our clients and our company will prosper. Our unwavering client and associate focus have earned us a reputation as one of the nation’s leading wealth management and investment banking firms. We have grown our business both organically and through opportunistic acquisitions.

We plan to maintain our focus on revenue growth with a continued appreciation for the development of quality client relationships. Within our private client business, our efforts will be focused on recruiting experienced financial advisors with established client relationships. Within our capital markets business, our focus continues to be on providing quality client management and product diversification. In executing our growth strategy, we will continue to seek out opportunities that allow us to take advantage of consolidation, whereby allowing us to increase market share in our private client and institutional group businesses.

Stifel Financial Corp., through its wholly owned subsidiaries, is principally engaged in retail brokerage; securities trading; investment banking; investment advisory; retail, consumer, and commercial banking; and related financial services. Our major geographic area of concentration is throughout the United States, the United Kingdom, Europe, and Canada. Our principal customers are individual investors, corporations, municipalities, and institutions.

Our ability to attract and retain highly skilled and productive associates is critical to the success of our business. Accordingly, compensation and benefits comprise the largest component of our expenses, and our performance is dependent upon our ability to attract, develop, and retain highly skilled associates who are motivated and committed to providing the highest quality of service and guidance to our clients.

On January 26, 2026, our Board declared a 50% stock dividend, in the form of a three-for-two stock split, of our common stock payable on February 26, 2026, to shareholders of record as of February 12, 2026. All share and per share information has been retroactively adjusted to reflect the stock split.

On February 2, 2026, the Company sold Stifel Independent Advisors, LLC (“SIA”), a wholly owned subsidiary and independent contractor broker-dealer, to an affiliate of Equitable, a financial services organization and principal franchise of Equitable Holdings, Inc. We recognized a gain on the sale of $47.3 million that is included in other income in the accompanying consolidated statements of operations. The results of operations of SIA have been included in our results up to the date of disposition.

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Results for the three and six months ended June 30, 2026

For the three months ended June 30, 2026, net revenues increased 13.0% to $1.5 billion from $1.3 billion during the comparable period in 2025. Net income available to common shareholders increased 49.0% to $217.2 million, or $1.34 per diluted common share for the three months ended June 30, 2026, compared to $145.7 million, or $0.89 per diluted common share during the comparable period in 2025.

Our revenue growth was primarily attributable to higher investment banking revenues, asset management revenues, commission revenues, and net interest income.

For the six months ended June 30, 2026, net revenues increased 15.3% to $2.9 billion compared to $2.5 billion during the comparable period in 2025. Net income available to common shareholders increased 142.5% to $459.3 million, or $2.83 per diluted common share for the six months ended June 30, 2026, compared to $189.4 million, or $1.15 per diluted common share during the comparable period in 2025.

Our revenue growth was primarily attributable to higher investment banking revenues, asset management revenues, commission revenues, net interest income, and the recognition of a gain on the sale of SIA during the first quarter.

Economic and Market Conditions

Results in the businesses in which we operate are highly correlated to general economic conditions and, more specifically, to the direction of the U.S. equity and fixed income markets. Market volatility, overall market conditions, interest rates, economic, political, and regulatory trends, and industry competition are among the factors which could affect us and which are unpredictable and beyond our control. These factors affect the financial decisions made by market participants who include investors and competitors, impacting their level of participation in the financial markets. In addition, in periods of reduced financial market activity, profitability is likely to be adversely affected because certain expenses remain relatively fixed, including salaries and related costs, as well as portions of communications costs and occupancy expenses. Accordingly, earnings for any period should not be considered representative of earnings to be expected for any other period.

For more information on economic and market conditions, and the potential effects of geopolitical events on our future results, refer to “Risk Factors” in the 2025 Form 10-K.

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RESULTS OF OPERATIONS

Three Months Ended June 30, 2026 Compared with Three Months Ended June 30, 2025

The following table presents consolidated financial information for the periods indicated (in thousands, except percentages):

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Six Months Ended June 30, 2026 Compared with Six Months Ended June 30, 2025

The following table presents consolidated financial information for the periods indicated (in thousands, except percentages):

NET REVENUES

The following table presents consolidated net revenues for the periods indicated (in thousands, except pe

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion of the financial condition and results of operations of our company should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in this Annual Report on Form 10-K for the year ended December 31, 2025.

Unless otherwise indicated, the terms “we,” “us,” “our,” or “our company” in this report refer to Stifel Financial Corp. and its wholly owned subsidiaries.

Executive Summary

We operate as a financial services and bank holding company. We have built a diversified business serving private clients, institutional investors, and investment banking clients located across the U.S., Europe, and Canada. Our principal activities are: (i) private client services, including securities transaction and financial planning services; (ii) institutional equity and fixed income sales, trading, and research, and municipal finance; (iii) investment banking services, including mergers and acquisitions, public offerings, and private placements; and (iv) retail and commercial banking, including personal and commercial lending programs.

Our core philosophy is based upon a tradition of trust, understanding, and studied advice. We attract and retain experienced professionals by fostering a culture of entrepreneurial, long-term thinking. We provide our private, institutional, and corporate clients quality, personalized service, with the theory that if we place clients’ needs first, both our clients and our company will prosper. Our unwavering client and associate focus have earned us a reputation as one of the nation’s leading wealth management and investment banking firms. We have grown our business both organically and through opportunistic acquisitions.

We plan to maintain our focus on revenue growth with a continued appreciation for the development of quality client relationships. Within our private client business, our efforts will be focused on recruiting experienced financial advisors with established client relationships. Within our capital markets business, our focus continues to be on providing quality client management and product diversification. In executing our growth strategy, we will continue to seek out opportunities that allow us to take advantage of consolidation, whereby allowing us to increase market share in our private client and institutional group businesses.

Stifel Financial Corp., through its wholly owned subsidiaries, is principally engaged in retail brokerage; securities trading; investment banking; investment advisory; retail, consumer, and commercial banking; and related financial services. Our major geographic area of concentration is throughout the United States, the United Kingdom, Europe, and Canada. Our principal customers are individual investors, corporations, municipalities, and institutions.

Our ability to attract and retain highly skilled and productive associates is critical to the success of our business. Accordingly, compensation and benefits comprise the largest component of our expenses, and our performance is dependent upon our ability to attract, develop, and retain highly skilled associates who are motivated and committed to providing the highest quality of service and guidance to our clients.

On April 7, 2025, the Company acquired a portion of B. Riley Financial, Inc.’s traditional wealth management business, a deal that added 36 advisors with approximately $4 billion in assets under management. Consideration for this transaction consisted of cash from operations.

On June 2, 2025, the Company acquired Bryan, Garnier & Co. (“Bryan Garnier”), an independent full-service investment bank focused on European technology and healthcare companies. Bryan Garnier’s product suite includes mergers & acquisitions advisory, private and public growth financing solutions, and institutional sales and execution. Bryan Garnier is headquartered in Europe with offices in Paris, London, Amsterdam, Munich, Oslo, Stockholm, and New York. Consideration for this transaction consisted of cash from operations.

On January 26, 2026, our Board declared a 50% stock dividend, in the form of a three-for-two stock split, of our common stock payable on February 26, 2026, to shareholders of record as of February 12, 2026. Trading will begin on a split-adjusted basis on February 27, 2026. On January 30, 2026, the Company had approximately 103.2 million shares outstanding. After the split, the Company will have approximately 154.8 million shares outstanding.

On February 2, 2026, the Company sold Stifel Independent Advisors, LLC, a wholly owned subsidiary and independent contractor broker-dealer, to an affiliate of Equitable, a financial services organization and principal franchise of Equitable Holdings, Inc.

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Results for the Year Ended December 31, 2025

For the year ended December 31, 2025, net revenues increased 11.3% to a record $5.53 billion compared to $4.97 billion during the comparable period in 2024. Net income available to common shareholders for the year ended December 31, 2025, decreased 6.9% to $646.5 million, or $5.87 per diluted common share, compared to $694.1 million, or $6.25 per diluted common share, in 2024. Net income available to common shareholders for the year ended December 31, 2025, was negatively impacted by elevated provisions for legal matters of $1.16 per diluted common share (after-tax) related to a FINRA Arbitration Panel decision in the first quarter.

Our revenue growth for the year ended December 31, 2025, was primarily attributable to higher investment banking revenues, asset management revenues, transactional revenues, and net interest income. For the year ended December 31, 2025, our Global Wealth Management segment posted record net revenues, with our Institutional Group segment posting its second highest net revenues.

We remain well-positioned entering fiscal 2026, with nearly $552 billion of client assets under administration, strong activity levels for financial advisory recruiting, a significant interest rate-sensitive asset base at our bank subsidiaries, and a strong investment banking pipeline. We expect wealth management revenues to grow as investors continue to redeploy cash into the markets and client assets grow through recruiting and market appreciation. Institutional revenues are expected to benefit from increased investment banking activity as well as continued growth in transactional revenues, particularly in the fixed income business.

Economic and Market Conditions

Results in the businesses in which we operate are highly correlated to general economic conditions and, more specifically, to the direction of the U.S. equity and fixed income markets. Market volatility, overall market conditions, interest rates, economic, political, and regulatory trends, and industry competition are among the factors which could affect us and which are unpredictable and beyond our control. These factors affect the financial decisions made by market participants who include investors and competitors, impacting their level of participation in the financial markets. In addition, in periods of reduced financial market activity, profitability is likely to be adversely affected because certain expenses remain relatively fixed, including salaries and related costs, as well as portions of communications costs and occupancy expenses. Accordingly, earnings for any period should not be considered representative of earnings to be expected for any other period.

Overall, 2026 is expected to be a year of continued economic growth, stable interest rates, and opportunities in credit markets. The U.S. economy is expected to continue its robust growth trajectory, potentially accelerating above 3% supported by tax cuts, AI spending, and deregulation. Risks to inflation are seen as more on the upside than the downside, with the Federal Reserve likely to maintain a ‘hold’ stance on interest rates after the December 2025 rate cut. Longer-dated bond yields are expected to trade in a range, reflecting what are considered normal levels of interest rates. Global credit markets are expected to continue outperforming, driven by a focus on carry (yield) rather than capital gains. Corporate bonds are likely to outperform government bonds and cash. For more information on economic and market conditions, and the potential effects of geopolitical events on our future results, refer to “Item 1A – Risk Factors” of this Form 10-K.

New Tax Legislation

On July 4, 2025, the reconciliation bill, commonly referred to as the One Big Beautiful Bill Act (OBBBA), was signed into law in the U.S., which includes a broad range of tax reform provisions. Beginning in 2025, the OBBBA provides an elective deduction for domestic research and development expenses, a reinstatement of elective 100% first-year bonus depreciation, and repeal of non-U.S. corporations’ fiscal year-end. Some impacts of the OBBBA will not be realized until 2026 and forward, such as revisions to the international tax framework.

The Company elected to expense its domestic research and development expenditures and take 100% bonus depreciation for qualified assets for U.S. tax purposes. We will continue to monitor the impact of the OBBBA and the range of potential outcomes, which will depend on our facts in each year and anticipated guidance from the U.S. Department of the Treasury.

Interest Rate Environment

During the fourth quarter of 2025, the Federal Reserve announced a 25-basis-point reduction in the federal funds rate target range to 3.50% to 3.75%, as the labor market shows signs of softening while acknowledging inflation and economic outlook uncertainty remain somewhat elevated. In addition, the Federal Reserve ended the balance sheet reduction program, which began in 2022, effective December 1, 2025.

During the January meeting, the Federal Reserve voted to hold the target range for the federal funds rate at 3.50% to 3.75%. The Federal Reserve noted that it will continue to monitor economic data and adjust its stance on monetary policy if risks emerge that could negatively impact the attainment of its goal of maximum employment and inflation at 2% over the long term.

Potential decreases to the federal funds rate may impact our interest-based revenues. While decreases in interest rates will lower fees the Company earns from FDIC-insured deposits of clients through a program offered by the Company, such decreases may be offset to a degree if the cash sweep balances increase as clients find fewer higher-yielding alternatives to deploy these balances. Future rate decreases will also reduce the rates the Company charges on customer margin loans, which will have a negative impact on our earnings.

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RESULTS OF OPERATIONS

The following table presents consolidated financial information for the periods indicated (in thousands, except percentages):

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