By Rebecca Ungarino

The vast differences between public companies' performances are driving a notable shift in the world of investment banking, Lazard Chief Executive Officer Peter Orszag said on a call with reporters Thursday.

The businesses of restructuring troubled companies and advising on mergers and acquisitions can now generally perform well at the same time. That is different from in years past, when strength in one area meant weakness in the other, he said on a call to discuss the bank and asset manager's financial results.

The reason for the change is that the gap between the best- and worst-performing companies has grown dramatically over the past couple of decades, Orszag said, viewed through the lens of performance measures such as return on invested capital, or ROIC.

"With that wider dispersion, you can have periods in which both things coexist, because the firms performing really well see an incentive to acquire less well-performing firms in order to improve their performance, " he said. "Yet there are plenty of firms at the bottom of the distribution that need help on liability management and restructuring."

On Thursday, Lazard said for the first nine months of this year, it achieved record adjusted revenue of $1.3 billion in its financial advisory business, up 5% from the same period in 2024.

That business encompasses its restructuring and liability management and M&A advisory practices. The former group is advising collapsed auto-parts supplier First Brands in its high-profile Chapter 11 bankruptcy case unfolding this fall.

"The big trend is toward liability management and away from restructuring," Orszag said, referring to companies generally.

Liability management focuses on helping distressed companies manage what they owe lenders, while broader restructuring deals can involve more fundamental corporate shake-ups. Some of the firm's well-known rivals in this area include Houlihan Lokey, Moelis & Co., and Evercore.

Lazard's shares fell 3.5% on Thursday after initially rising in premarket trading. The stock is down 5% this year, while the S&P 500 is up 15%.

Third-quarter revenue of $327 million from Lazard's asset management business rose 11% from a year ago. Firmwide, however, revenue and net income fell 5% and 34%, respectively. On an adjusted basis, revenue and net income rose a respective 12% and 56% from a year earlier.

Orszag, who joined Lazard in 2016 as vice chairman of investment banking, has run the New York firm since October 2023. He was appointed to revive the firm after years of underperformance.

Write to Rebecca Ungarino at rebecca.ungarino@barrons.com

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October 23, 2025 14:34 ET (18:34 GMT)

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