The company also warned of an uncertain outlook for the year and said it would eliminate around 10% of its workforce in 2023, which could result in additional costs of around $95 million. As of last year December, Lazard had around 3,400 employees.
Major Wall Street investment banks including Morgan Stanley (NYSE:MS) and Goldman Sachs (NYSE:GS) have felt the brunt of a barren environment for mergers and acquisitions (M&A) as rising interest rates, high inflation and fears of a recession soured the appetite for dealmaking.
M&A volumes nearly halved in the first quarter from a year earlier, according to data from Dealogic.
As a result, Lazard’s operating revenue from its financial advisory business fell 29% to $274 million in the first quarter, when the company also recorded a $21 million charge from its cost-saving measures.
“Slower M&A activity resulted in significantly lower revenues in the quarter and the outlook for the year remains uncertain,” said Lazard CEO Kenneth Jacobs.
A banking crisis last month has also dampened investor sentiment, prompting an outflow of client assets that has hit fees earned from asset management.
Revenue from the segment, which is highly focused on equities and fixed income assets, dipped 15% to $265 million in the quarter ended March 31.
On an adjusted basis, Lazard reported a loss of $23 million, or 26 cents per share, compared with a profit of $115 million, or $1.05 per share, a year earlier. Analysts had expected a profit of 26 cents per share, as per Refinitiv IBES data.
Source: Economy - investing.com
