Raymond James achieves record net revenue, earnings

Raymond James Financial achieved record annual net revenue and record net income last year, marking the third year in a row of historic results for the firm, CEO Paul Reilly said Wednesday.

Raymond James obtained $11.62 billion in net revenue and $1.73 billion in net income available to common shareholders in fiscal 2023, up 6% and 15%, respectively, over fiscal 2022, according to an announcement about its fourth quarter and annual results. Its fiscal year ended Sept. 30.

The firm's domestic private client group garnered $73.3 billion in net new assets in fiscal 2023 and $14.2 billion in the fourth quarter, representing a 7.7% and 5% annualized growth rate, respectively, on assets from the beginning of the period.  

Reilly attributed the third consecutive year of record results in “very different market environments” to the firm staying “true to our core.”

“We put clients first; we act with integrity; we value independence and think long-term,” Reilly said on a call with analysts after markets closed Wednesday. “These core values … are lived day-in and day-out by our advisors and associates. This dedication and focus provides stability during tough economic times and what makes me confident about our continued success in the future.”

Raymond James’ private client group reported record annual net revenues — $8.65 billion, up 12% from fiscal 22 — and record annual pretax income — $1.76 billion, up 71% from fiscal 22. It achieved record quarterly results in each category as well — $2.3 billion in net revenue, up 14% from the fourth quarter of fiscal 22; and $477 million in pretax income, up 29% from the previous year. The firm cited the growth of assets in fee-based accounts as one of the reasons it achieved those numbers.

“With our continuing focus on retaining, supporting and attracting high-quality financial advisors, PCG consistently generates strong organic growth,” Reilly said.

The firm has approximately 8,700 advisors across different affiliation options — ranging from independent brokers to registered investment advisors — and $1.26 trillion in assets under management. It has limited advisor attrition to about 1% and is attracting more advisors due to its client-first focus, technology and product offerings, Reilly said.

“Our advisor recruiting has picked up significantly over the last two months, with record numbers of large teams in our pipeline,” Reilly said.

Even though advisor movement is down across the financial industry, Reilly said, Raymond James is talking to many advisor teams that generate $10 million to $20 million in revenue.

“Not saying we’re going to close them all,” Reilly said. “But we’ve never had this many at one time, where we’re down to the final kind of negotiating line — as well as people that have committed we haven’t announced.”

Raymond James’ earnings were hurt by the firm’s having to pay a $55 million fine to the Securities and Exchange Commission for record-keeping violations related to the use of so-called off-channel communications, such as messaging apps, to conduct business.

“We are confident we are now fully reserved for this matter,” Paul Shoukry, Raymond James chief financial officer, told analysts.

Reilly is confident about the firm’s outlook given its mix of offerings, which include wealth management, asset management, banking and other services.

“While there is still near-term economic uncertainty, I believe we are in a position of strength and are well-positioned to drive growth over the long term across all of our businesses,” he said.