Canaccord Genuity FY 2025 slides: revenue up 19.5%, wealth management drives growth

Introduction & Market Context

Canaccord Genuity Group Inc. (TSX:CF) presented its fiscal year 2025 results on June 5, 2025, highlighting a strategic shift toward a more defensive revenue mix with growing contributions from wealth management and advisory services. The company’s stock closed at $9.11 on June 4, trading near the middle of its 52-week range of $7.45 to $11.50.

The financial services firm has been executing a multi-year strategy to reduce its reliance on volatile underwriting activity while building more stable revenue streams through wealth management and advisory services, a move that appears to be paying dividends in the current market environment.

Executive Summary

Canaccord Genuity reported strong financial results for fiscal year 2025, with revenue reaching $1.8 billion, up 19.5% year-over-year. Pre-tax net income increased 12.0% to $149.1 million, while diluted earnings per share jumped 52.5% to $0.61. The company’s global footprint now spans 47 locations across 4 continents, with 2,925 employees serving clients worldwide.

As shown in the following overview of the company’s business model and key metrics:

The company’s client assets reached $120 billion, with $37 billion in proceeds raised through 355 investment banking transactions during the fiscal year. This represents significant growth from the $106 billion in client assets reported in the first quarter of fiscal 2025, indicating continued momentum throughout the year.

Detailed Financial Analysis

Canaccord’s financial performance showed strong growth in fiscal 2025, though with some margin compression. Revenue for Q4 fiscal 2025 was $460.0 million, up 12.4% year-over-year, while pre-tax net income was $32.2 million, down 17.5% from the same period last year. For the full fiscal year, revenue grew 19.5% to $1.8 billion, with pre-tax net income increasing 12.0% to $149.1 million.

The company’s pre-tax profit margin for fiscal 2025 was 8.4%, down slightly from 9.0% in fiscal 2024, reflecting increased investments in growth initiatives and compliance infrastructure. Diluted EPS for the year was $0.61, a substantial 52.5% increase from $0.40 in the previous year.

A key strength in Canaccord’s financial strategy has been its increasingly defensive revenue mix, which provides downside protection during market volatility. The following chart illustrates how the company has reduced reliance on underwriting activity while growing contributions from wealth management and advisory services:

Wealth management revenue has grown at a 12% CAGR over the past five years, while advisory revenue has increased at an 8% CAGR during the same period. This shift has created a more stable revenue foundation, with wealth management contributing $905 million in fiscal 2025, up from $708 million in fiscal 2024.

Strategic Initiatives

Canaccord Genuity has been strategically investing in key markets to drive long-term growth. The company has significantly expanded its wealth management businesses in Canada, the UK, and Australia, becoming a top-10 wealth manager by client assets in the UK. It has also expanded its higher-margin advisory businesses in the US and UK, achieving a top ranking for U.S. mid-market TMT Advisory.

An important element of Canaccord’s strategy is increasing employee ownership to support its partnership culture. The company reported that 42.3% of outstanding shares are now held by senior officers, employee LTIP, and the employee-owned limited partnership. In March 2024, the Limited Partnership acquired approximately 9.7% of outstanding CF common shares, increasing to 11.2% following regulatory approval in Q4/25.

The company is also focusing on expense management to create capacity for investments in growth. Of the year-over-year increase in operating expenses, only 24% was attributable to discretionary expenses, with the remainder split between fixed expenses and revenue/investment-driven expenses.

Wealth Management Performance

Wealth management has emerged as a cornerstone of Canaccord’s business model, with the division reporting impressive growth across all regions. For fiscal 2025, the wealth management division generated revenue of $905 million and pre-tax net income of $149 million, achieving a pre-tax profit margin of 17%.

The following chart shows the growth in client assets and revenue for the wealth management division:

By region, the wealth management business showed strong performance:

• Canada: Revenue of $374.8 million (up 25.7% y/y), pre-tax net income of $43.1 million (up 20.5% y/y), and total client assets of $42.7 billion (up 11.2% y/y)
• UK & Crown Dependencies: Revenue of $449.8 million (up 19.3% y/y), pre-tax net income of $101.0 million, and total client assets of C$69.2 billion
• Australia: Revenue of $80.3 million, pre-tax net income of $4.9 million, and total client assets of C$8.4 billion

Fee-based assets have been growing as a percentage of total assets, providing more stable and predictable revenue streams. In Canada, fee-based assets reached $20.7 billion, up 21.9% year-over-year.

Capital Markets Performance

Canaccord’s capital markets division also delivered strong results in fiscal 2025, with revenue of $831 million and 355 transactions completed, raising $37 billion in proceeds. The division has maintained a disciplined sector focus, with technology representing 38% of combined advisory and underwriting revenue, followed by metals & mining at 23%.

The following overview illustrates the performance of the capital markets division:

Investment banking revenue improved by 43.9% year-over-year, while advisory revenue increased 32.7%, reflecting an improving environment for deal completions. The company’s global capabilities provide a significant competitive advantage in its key focus sectors.

The sector allocation of Canaccord’s capital markets business demonstrates its disciplined approach:

By region, the capital markets division reported the following revenues for fiscal 2025:

• US: $426.9 million
• Canada: $183.0 million
• UK & Europe: $121.6 million
• Australia: $99.3 million

Forward-Looking Statements

Looking ahead, Canaccord Genuity is focused on continuing to grow its wealth management businesses, expanding its higher-margin advisory services, and deepening its presence in core capital markets sectors. The company’s investment proposition centers on its strong balance sheet, growing wealth management businesses, alignment of management and employees with shareholders, and increasing contributions from its higher-margin capital markets advisory franchise.

In the first quarter of fiscal 2025, the company reported continued momentum with a 25% increase in firm-wide revenue year-over-year to $429 million, suggesting that the positive trends seen in fiscal 2025 are continuing into the new fiscal year. The capital markets division experienced a 41% revenue increase in Q1, reaching $206 million, while the wealth management business saw a 13% rise to $216 million.

While the company noted challenges in the IPO market and difficulty in predicting new issue revenue, it remains optimistic about future corporate finance and M&A activities, particularly in the mid-cap and smaller-cap sectors where Canaccord has established a strong competitive position.

As Canaccord continues to execute its strategy of building a more defensive revenue mix while investing in growth opportunities, investors will be watching closely to see if the company can maintain its strong performance in fiscal 2026.

Full presentation:

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