Macquarie’s 1H Profit Falls, to Launch Up to A$2 Billion Buyback
Net profit for the six months through September fell to A$1.42 billion
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SYDNEY—Macquarie Group’s first-half net profit fell by 39%, but the company said its strong capital position means it could soon begin buying back shares worth up to 2.0 billion Australian dollars (US$1.29 billion).
Macquarie, Australia’s biggest investment bank and asset manager, said its net profit for the six months through September fell to A$1.42 billion, from A$2.31 billion a year earlier.
Chief Executive Shemara Wikramanayake said Macquarie’s underlying client franchises were resilient amid less certain market conditions.
“Our annuity-style businesses saw growth in loan books, deposits and assets under management, but the first-half result was substantially down compared to a strong period of realizations in the prior corresponding period,” she said. “Our markets-facing businesses delivered solid performances despite lower market activity and volatility levels.”
Macquarie said its group capital surplus was A$10.5 billion at the end of September, down from A$12.6 billion at end-March. Still, the company said its financial position comfortably exceeded regulatory minimum requirements, allowing it to buy back shares worth up to A$2 billion.
Macquarie’s annuity-style activities contributed A$1.3 billion to first-half profit, although this down 43% on a year earlier. This reflected the timing of asset realizations in green investments in Macquarie Asset Management, which more than offset a positive result in Banking and Financial Services.
Markets-facing activities, which include most of its Commodities and Global Markets businesses, fell 32% on year to A$1.56 billion.
“The prior corresponding period featured a strong performance from commodities in CGM together with material asset realizations in Macquarie Capital,” said the company.
Directors declared an interim dividend of A$2.55 per share, lower than a payout of A$3.00 a share a year ago. Still, that beat under consensus forecasts compiled by FactSet, which projected Macquaries’s interim dividend would be A$2.42.
Macquarie’s net operating income of A$7.91 billion was down 8% on year, while operating expenses of A$5.92 billion rose by 6% on year.
International income accounted for 65% of Macquarie’s total income, the company said
Macquarie, which has a reputation among analysts for conservative forecasts, didn’t provide specific guidance.
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The social-media company’s revenue increased 14%, falling short of estimates.
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Pinterest shares tumbled after the company projected that revenue growth would slow in the first quarter, amid an advertiser pullback that weighed on its fourth-quarter earnings.
Shares slid 18.5% to $15.10 in after-hours trading after closing the market session down 2.9% at $18.54.
Pinterest reported a 14% increase in fourth-quarter revenue to $1.32 billion, up from $1.15 billion a year earlier, but short of analysts’ estimate of $1.33 billion, according to FactSet. The company posted 17% revenue growth in the third quarter.
The company expects growth to decelerate further in the current first quarter, projecting growth between 11% and 14%. It’s forecasting revenue between $951 million and $971 million.
Chief Executive Officer William Ready said the company needs to broaden its revenue mix and accelerate sales going forward.
“We are not satisfied with our Q4 revenue performance and believe it does not reflect what Pinterest can deliver over time,” he told analysts on a call Thursday. “We are moving with urgency to return over time to the mid-to-high-teens growth, or better than what we have been consistently delivering.”
Pinterest on Thursday recorded a profit of $277.1 million, or 41 cents a share, compared with its profit of $1.85 billion, or $2.68 a share, a year earlier. The $1.85 billion profit in 2024 included a $1.6 billion benefit from deferred tax assets.
Stripping out certain one-time items, Pinterest logged adjusted earnings of 67 cents a share, in line with analyst expectations, according to FactSet.
Ready said the company continues to see headwinds from larger retailers pulling back on advertising spending to protect their margins amid the impact from President Trump’s tariffs.
“We saw continued softness from this cohort of large retailers,” Ready said. “While we see opportunity over the long term, the near-term outlook for this cohort on our platform remains pressured given these headwinds.”
Ready said the company has expanded its footprint among mid-market and small-to-medium business advertisers, as well as international businesses. Still, he said Pinterest had a ways to go to offset the headwinds from larger advertisers, which may become even more pronounced in the current quarter.
Chief Financial Officer Julia Donnelly added that the company is looking to increase its investments in sales and research and development related to artificial-intelligence following the launch of its restructuring effort in January. Pinterest said last month that it would cut about 15% of its workforce, or approximately 700 jobs.
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