Marsh Q4 Earnings Beat Estimates on Consulting Unit Strength

Marsh & McLennan Companies, Inc. MRSH reported fourth-quarter 2025 adjusted earnings per share of $2.12, which surpassed the Zacks Consensus Estimate by 7.6%. The bottom line advanced 10% year over year.

Consolidated revenues of $6.6 billion improved 9% year over year. The figure rose 4% on an underlying basis. Also, the top line beat the consensus mark by 1.2%.

The strong quarterly results benefited from solid growth in the Risk and Insurance Services and Consulting unit, particularly from the Guy Carpenter, Mercer and Marsh Management Consulting businesses. However, the upside was partially offset by elevated operating expenses, primarily due to increased compensation and benefits.

Marsh Price, Consensus and EPS Surprise

Marsh price-consensus-eps-surprise-chart | Marsh Quote

MRSH’s Q4 Performance

Total operating expenses escalated 9.2% year over year to $5.4 billion, higher than our model estimate of $5.1 billion. The year-over-year rise was due to increased compensation and benefits costs and other operating expenses. Expenses in the Risk and Insurance Services segment rose 9.2% year over year, while the Consulting segment's expenses increased 9.4%.

Marsh’s adjusted operating income improved 12% year over year to $1.6 billion. Adjusted operating margin of 23.7% increased 40 basis points year over year.

Q4 Segmental Update

Risk and Insurance Services

The segment recorded revenues of $4 billion in the fourth quarter, which rose 9% year over year and 2% on an underlying basis. The reported figure came in line with the Zacks Consensus Estimate. Adjusted operating income advanced 11% year over year to $1.1 billion, which beat the consensus mark by 1.4%.

Revenues of Marsh Risk, a unit within the segment, rose 10% year over year and 3% on an underlying basis to $3.7 billion. In the United States/Canada operations, revenues grew 3% on an underlying basis. International operations also witnessed revenue growth of 4% year over year on an underlying basis. Among the international operations, Latin America witnessed a year-over-year decline of 4% on an underlying basis. Asia Pacific and EMEA’s revenues improved 2% and 6%, respectively, on an underlying basis.

Another unit within the segment, Guy Carpenter's revenues of $215 million rose 7% year over year and 5% on an underlying basis. The figure beat the consensus mark by 1.5%.

Consulting

The unit’s revenues advanced 8% year over year and 5% on an underlying basis to $2.6 billion. The reported figure beat the Zacks Consensus Estimate by 3%. Adjusted operating income of $550 million climbed 10% year over year and beat the consensus mark by 4%.

Revenues of Mercer, a unit within this segment, grew 9% year over year and 4% on an underlying basis to $1.6 billion. The reported figure beat the Zacks Consensus Estimate by 3%. Health and Wealth revenues rose 6% and 5%, respectively, on an underlying basis. Career revenues fell 2% year over year on an underlying basis.

Another unit within the segment, Marsh Management Consulting, recorded revenues of $1 billion, which improved 8% year over year as well as 8% on an underlying basis.

Financial Update (as of Dec. 31, 2025)

Marsh exited the fourth quarter with cash and cash equivalents of $2.7 billion, which rose from the 2024-end figure of $2.4 billion. Total assets of $58.7 billion increased from the $56.5 billion figure at the end of 2024.

Long-term debt amounted to $18.3 billion, which slipped from the $19.4 billion figure as of Dec. 31, 2024. Short-term debt amounted to $1.3 billion.

Total equity of $15.3 billion advanced from the 2024-end level of $13.5 billion.

Marsh generated an operating cash flow of $5.3 billion during 2025, up from $4.3 billion a year ago.

Capital Deployment Update

Marsh bought back 10.1 million shares worth $2 billion in 2025.

Full-Year 2025 Results of MRSH

MRSH’s 2025 revenues of $27 billion rose from $24.5 billion a year ago. The figure rose 4% on an underlying basis.

Full-year 2025 adjusted EPS of $9.75 increased 9% year over year.

MRSH’s Zacks Rank & Key Picks

MRSH currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader Business Services space are Maximus, Inc. MMS, Remitly Global, Inc. RELY and Adeia Inc. ADEA, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Maximus’ current-year earnings of $8.19 per share has witnessed one upward revision in the past 60 days against none in the opposite direction. Maximus beat earnings estimates in three of the trailing four quarters, with the average surprise being 29.3%. The consensus estimate for current-year revenues is pegged at $5.5 billion, implying 0.4% year-over-year growth.

The Zacks Consensus Estimate for Remitly Global’s current-year earnings of 13 cents per share has remained stable over the past 60 days. Remitly Global beat earnings estimates in three of the trailing four quarters. The consensus estimate for current-year revenues is pegged at $1.6 billion, calling for 28.2% year-over-year growth.

The Zacks Consensus Estimate for Adeia’s current-year earnings is pegged at $1.53 per share, implying 21.4% year-over-year growth. In the past 60 days, Adeia has witnessed two upward estimate revisions against none in the opposite direction. The consensus mark for the current-year revenues is pegged at $427.7 million, calling for 13.7% year-over-year growth.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research