Arthur J. Gallagher (NYSE: AJG) posts strong Q1 2026 revenue and EPS growth
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
Arthur J. Gallagher & Co. reported strong first quarter 2026 results, with total company revenues before reimbursements of $4.716 billion, up from $3.688 billion a year earlier. Net earnings rose to $823 million, compared with $709 million, and diluted earnings per share increased to $3.16 from $2.72.
For the combined brokerage and risk management segments, management highlighted revenue growth of 28%, driven by both acquisitions and organic expansion. Organic revenue growth was 5% in brokerage and 10% in risk management fees, reflecting strong client retention and a diversified platform.
Adjusted non‑GAAP performance was also higher. Total company adjusted revenues before reimbursements were $4.714 billion versus $3.746 billion, while adjusted EBITDAC reached $1.752 billion compared with $1.435 billion. Adjusted diluted EPS increased to $4.47 from $3.72, marking the 24th consecutive quarter of double‑digit adjusted EBITDAC growth.
Positive
- Total company revenues before reimbursements grew to $4.716 billion in Q1 2026 from $3.688 billion a year earlier, with net earnings rising to $823 million and diluted EPS to $3.16 from $2.72.
- Combined brokerage and risk management segments achieved 28% revenue growth, with brokerage organic revenue up 5% and risk management organic fees up 10%, indicating both acquisition-driven and underlying expansion.
- Adjusted profitability improved, as total company adjusted EBITDAC increased to $1.752 billion from $1.435 billion and adjusted diluted EPS rose to $4.47 from $3.72, marking the 24th consecutive quarter of double-digit adjusted EBITDAC growth.
Negative
- None.
Insights
Gallagher posts broad-based Q1 2026 growth with stronger margins on an adjusted basis.
Arthur J. Gallagher & Co. delivered higher Q1 2026 scale and profitability. Revenues before reimbursements rose to $4.716 billion from $3.688 billion, while net earnings increased to $823 million and diluted EPS climbed to $3.16 from $2.72.
Management emphasized combined brokerage and risk management revenue growth of 28%, with organic growth of 5% in brokerage and 10% in risk management fees. Adjusted EBITDAC grew 18%, reaching $1.752 billion, and adjusted diluted EPS rose to $4.47 from $3.72, reflecting stronger underlying operating performance.
The company continues to integrate large acquisitions such as AssuredPartners while managing higher compensation and technology costs. It also repurchased about $310 million of stock in Q1 2026. Future filings and the detailed non‑GAAP reconciliations will help track how acquisition integration, cost controls and clean‑energy investments affect margins over subsequent quarters.
8-K Event Classification
3 items: 2.02, 7.01, 9.01
3 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 7.01
Regulation FD Disclosure
Disclosure
Material non-public information disclosed under Regulation Fair Disclosure, often investor presentations or guidance.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Revenues before reimbursements: $4.716B
Net earnings: $823M
Diluted EPS: $3.16
+5 more
8 metrics
Revenues before reimbursements
$4.716B
Total company, Q1 2026 vs $3.688B in Q1 2025
Net earnings
$823M
Total company, Q1 2026 vs $709M in Q1 2025
Diluted EPS
$3.16
Total company, Q1 2026 vs $2.72 in Q1 2025
Adjusted EBITDAC
$1.752B
Total company, Q1 2026 vs $1.435B in Q1 2025
Adjusted diluted EPS
$4.47
Total company, Q1 2026 vs $3.72 in Q1 2025
Brokerage organic revenues
$3.208B
Brokerage segment total organic revenues, Q1 2026; 5% organic change
Risk Management organic fees
$407M
Risk Management segment organic fees, Q1 2026; 10% organic change
Share repurchases
$310M
Approximate cost to repurchase 1.4M shares in Q1 2026
Key Terms
EBITDAC, adjusted EBITDAC, organic revenue, acquisition integration costs, +2 more
6 terms
EBITDAC financial
"EBITDAC is net earnings before interest, income taxes, depreciation, amortization and the change in estimated acquisition earnout payables"
EBITDAC is a version of operating profit that adds back interest, taxes, depreciation and amortization, and also removes the financial impact of COVID-19-related costs or disruptions. Investors use it to see what a company’s recurring earnings might look like without pandemic-driven one-time losses or unusual expenses, much like wiping mud off a car to judge its normal paint condition rather than its temporary dirty state.
adjusted EBITDAC financial
"Adjusted EBITDAC is EBITDAC adjusted to exclude net gains on divestitures, acquisition integration costs, workforce related charges"
Adjusted EBITDAC is a company-provided profitability measure that shows earnings before interest, taxes, depreciation, amortization and specific items often tied to extraordinary events (the “C” typically denotes COVID-related costs), with additional one-time or unusual items removed. Think of it as the company’s view of underlying operating profit — like looking at a car’s engine performance after removing temporary add-ons — which can help investors compare core results across periods but is not governed by standard accounting rules.
organic revenue financial
"Organic revenue change measures the year-over-year percentage change in organic revenue"
Organic revenue is the sales a company generates from its regular business activities after stripping out extra effects like revenue added or lost from buying or selling other businesses and from currency swings. Think of it as measuring how much a store’s own customers increased spending, not growth from opening new stores or temporary price moves; investors use it to judge the true strength and sustainability of a company’s core demand.
acquisition integration costs financial
"Acquisition integration costs, which include costs related to certain large acquisitions"
AssuredPartners Financing financial
"we raised a total of approximately $14 billion of cash via a follow-on common stock offering and senior notes issuance to fund the AssuredPartners acquisition"
Earnings Snapshot
Revenues before reimbursements: $4.716B
Q1 2026
Revenues before reimbursements
$4.716B
up from $3.688B in Q1 2025
Net earnings
$823M
up from $709M in Q1 2025
Diluted EPS
$3.16
up from $2.72 in Q1 2025
Adjusted EBITDAC
$1.752B
up from $1.435B in Q1 2025
Adjusted diluted EPS
$4.47
up from $3.72 in Q1 2025
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________
Form 8-K
__________________________
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report: (Date of earliest event reported)
__________________________
(Exact name of registrant as specified in its charter)
__________________________
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(Address, including zip code and telephone number, including area code, of registrant’s principal executive offices)
Not Applicable
(Former name or former address, if changed since last report)
__________________________
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition
On April 30, 2026, Arthur J. Gallagher & Co. (the Company) issued a press release setting forth the Company’s financial results for the quarter ended March 31, 2026 (the Earnings Release). A copy of the Earnings Release is attached hereto as Exhibit 99.1.
Item 7.01. Regulation FD Disclosure
In connection with the filing of the Earnings Release, the Company made materials entitled “Supplemental Quarterly Data” and “CFO Commentary” available through the investor relations page of its website. The CFO Commentary includes certain estimates relating to 2026 and other future results.
Item 9.01. Financial Statements and Exhibits
99.1 | Press release, dated April 30, 2026, issued by Arthur J. Gallagher & Co. | ||||
| 104 | The cover page from this Current Report on Form 8-K, formatted in Inline XBRL. | ||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| ARTHUR J. GALLAGHER & CO. | ||||||||
| Date: April 30, 2026 | By: | /s/ Douglas K. Howell | ||||||
Douglas K. Howell Vice President and Chief Financial Officer | ||||||||
Exhibit 99.1
NEWS RELEASE
ARTHUR J. GALLAGHER & CO. ANNOUNCES
FIRST QUARTER 2026 FINANCIAL RESULTS
FIRST QUARTER 2026 FINANCIAL RESULTS
ROLLING MEADOWS, IL, April 30, 2026 — Arthur J. Gallagher & Co. (NYSE: AJG) today reported its financial results for the quarter ended March 31, 2026. Management will host a webcast conference call to discuss these results on Thursday, April 30, 2026 at 5:15 p.m. ET/4:15 p.m. CT. To listen to the call, and for printer-friendly formats of this release, the “CFO Commentary” and “Supplemental Quarterly Data,” which may also be referenced during the call, please visit ajg.com/IR. These documents contain both GAAP and non-GAAP measures. Investors and other users of this information should read carefully the section entitled “Information Regarding Non-GAAP Measures” beginning on page 8.
Summary of Financial Results - First Quarter
Revenues Before Reimbursements | Net Earnings (Loss) | EBITDAC | Diluted Net Earnings (Loss) Per Share | |||||||||||||||||||||||||||||||||||||||||||||||
Segment | 1st Q 26 | 1st Q 25 | 1st Q 26 | 1st Q 25 | 1st Q 26 | 1st Q 25 | 1st Q 26 | 1st Q 25 | ||||||||||||||||||||||||||||||||||||||||||
| (in millions) | (in millions) | (in millions) | ||||||||||||||||||||||||||||||||||||||||||||||||
| Brokerage, as reported | $ | 4,293 | $ | 3,314 | $ | 913 | $ | 816 | $ | 1,562 | $ | 1,351 | $ | 3.51 | $ | 3.13 | ||||||||||||||||||||||||||||||||||
Net (gains) on divestitures | (7) | (6) | (5) | (4) | (7) | (6) | (0.02) | (0.02) | ||||||||||||||||||||||||||||||||||||||||||
Acquisition integration | – | – | 65 | 33 | 87 | 44 | 0.25 | 0.13 | ||||||||||||||||||||||||||||||||||||||||||
Workforce and lease termination | – | – | 20 | 14 | 27 | 18 | 0.08 | 0.05 | ||||||||||||||||||||||||||||||||||||||||||
Acquisition related adjustments | – | – | 39 | 25 | 50 | 30 | 0.15 | 0.09 | ||||||||||||||||||||||||||||||||||||||||||
Amortization of intangible assets | – | – | 201 | 152 | – | – | 0.77 | 0.59 | ||||||||||||||||||||||||||||||||||||||||||
Effective income tax rate impact | – | – | – | 1 | – | – | – | – | ||||||||||||||||||||||||||||||||||||||||||
Levelized foreign currency translation | – | 57 | – | 13 | – | 19 | – | 0.05 | ||||||||||||||||||||||||||||||||||||||||||
| Brokerage, as adjusted | 4,286 | 3,365 | 1,233 | 1,050 | 1,719 | 1,456 | 4.74 | 4.02 | ||||||||||||||||||||||||||||||||||||||||||
Risk Management, as reported | 428 | 374 | 50 | 41 | 86 | 72 | 0.19 | 0.16 | ||||||||||||||||||||||||||||||||||||||||||
Acquisition integration | – | – | 1 | 1 | 1 | 2 | – | – | ||||||||||||||||||||||||||||||||||||||||||
Workforce and lease termination | – | – | 1 | 3 | 1 | 3 | – | 0.01 | ||||||||||||||||||||||||||||||||||||||||||
Acquisition related adjustments | – | – | 4 | – | 6 | – | 0.02 | – | ||||||||||||||||||||||||||||||||||||||||||
Amortization of intangible assets | – | – | 5 | 4 | – | – | 0.02 | 0.02 | ||||||||||||||||||||||||||||||||||||||||||
Levelized foreign currency translation | – | 7 | – | 1 | – | 1 | – | – | ||||||||||||||||||||||||||||||||||||||||||
Risk Management, as adjusted | 428 | 381 | 61 | 50 | 94 | 78 | 0.23 | 0.19 | ||||||||||||||||||||||||||||||||||||||||||
Corporate, as reported | (5) | – | (140) | (148) | (91) | (122) | (0.54) | (0.57) | ||||||||||||||||||||||||||||||||||||||||||
Transaction-related costs | – | – | 6 | 20 | 7 | 23 | 0.02 | 0.08 | ||||||||||||||||||||||||||||||||||||||||||
Legal & tax related | – | – | 1 | – | 18 | – | – | – | ||||||||||||||||||||||||||||||||||||||||||
| Clean energy-related | 5 | – | 3 | – | 5 | – | 0.02 | – | ||||||||||||||||||||||||||||||||||||||||||
| Corporate, as adjusted | – | – | (130) | (128) | (61) | (99) | (0.50) | (0.49) | ||||||||||||||||||||||||||||||||||||||||||
| Total Company, as reported | $ | 4,716 | $ | 3,688 | $ | 823 | $ | 709 | $ | 1,557 | $ | 1,301 | $ | 3.16 | $ | 2.72 | ||||||||||||||||||||||||||||||||||
| Total Company, as adjusted | $ | 4,714 | $ | 3,746 | $ | 1,164 | $ | 972 | $ | 1,752 | $ | 1,435 | $ | 4.47 | $ | 3.72 | ||||||||||||||||||||||||||||||||||
Total Brokerage & Risk Management, as reported | $ | 4,721 | $ | 3,688 | $ | 963 | $ | 857 | $ | 1,648 | $ | 1,423 | $ | 3.70 | $ | 3.29 | ||||||||||||||||||||||||||||||||||
Total Brokerage & Risk Management, as adjusted | $ | 4,714 | $ | 3,746 | $ | 1,294 | $ | 1,100 | $ | 1,813 | $ | 1,534 | $ | 4.97 | $ | 4.21 | ||||||||||||||||||||||||||||||||||
First quarter 2025 reported and adjusted amounts for the Brokerage Segment include approximately $143 million of incremental interest income, or approximately 41 cents after-tax, earned on the cash proceeds held to fund the AssuredPartners acquisition.
For first quarter 2026, the pretax impact of adjustments for the Brokerage, Risk Management, and Corporate Segments totals $431 million, $15 million and $30 million, respectively, and corresponding adjustment to the provision (benefit) for income taxes was $111 million, $4 million and ($20) million, respectively, relating to these adjustments. A detailed reconciliation is shown on pages 16 and 17.
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“We had a terrific first quarter!” said J. Patrick Gallagher, Jr., Chairman and CEO. “For our combined brokerage and risk management segments, our two-pronged revenue growth strategy – growing both organically and through acquisitions – delivered revenue growth of 28% in the quarter. Our organic growth of 5% reflected strong client retention, disciplined execution, and the benefit of our diversified platform. Net earnings increased 12%, and adjusted EBITDAC grew 18%, marking our 24th consecutive quarter of double-digit adjusted EBITDAC growth.
“Our results reflect the strength and consistency of our business model across the dynamic insurance and economic environment. We remain focused on organic growth, strategic mergers and acquisitions, investment in productivity and quality, and maintaining our culture. We are also seeing the benefit of deeper collaboration across our P&C brokerage, benefits, and claims teams, supported by practical applications of AI, automation, and digitization that enhance how we serve and advocate for our clients. We believe Gallagher is well positioned to continue delivering strong growth and long‑term value for our shareholders.”
Brokerage Segment Reported GAAP to Adjusted Non-GAAP Reconciliations (dollars in millions):
See “Information Regarding Non-GAAP Measures” beginning on page 8 of 17.
Organic Revenues (Non-GAAP) | 1st Q 2026 | 1st Q 2025 | ||||||||||||
Base Commissions and Fees | ||||||||||||||
Commissions and fees, as reported | $ | 3,915 | $ | 2,869 | ||||||||||
Less commissions and fees from acquisitions, divested operations and other | (937) | (64) | ||||||||||||
Levelized foreign currency translation | – | 52 | ||||||||||||
Organic base commissions and fees | $ | 2,978 | $ | 2,857 | ||||||||||
Organic change in base commissions and fees | 4 | % | ||||||||||||
Supplemental Revenues | ||||||||||||||
Supplemental revenues, as reported | $ | 180 | $ | 114 | ||||||||||
Less supplemental revenues from acquisitions, divested operations and other | (46) | – | ||||||||||||
Levelized foreign currency translation | – | 2 | ||||||||||||
Organic supplemental revenues | $ | 134 | $ | 116 | ||||||||||
Organic change in supplemental revenues | 16 | % | ||||||||||||
Contingent Revenues | ||||||||||||||
Contingent revenues, as reported | $ | 115 | $ | 93 | ||||||||||
Less contingent revenues from acquisitions, divested operations and other | (19) | – | ||||||||||||
Levelized foreign currency translation | – | 1 | ||||||||||||
Organic contingent revenues | $ | 96 | $ | 94 | ||||||||||
Organic change in contingent revenues | 2 | % | ||||||||||||
Total reported commissions, fees, supplemental revenues and contingent revenues | $ | 4,210 | $ | 3,076 | ||||||||||
Less commissions, fees, supplemental revenues and contingent revenues from acquisitions, divested operations and other | (1,002) | (64) | ||||||||||||
Levelized foreign currency translation | – | 55 | ||||||||||||
Total organic commissions, fees, supplemental revenues and contingent revenues | $ | 3,208 | $ | 3,067 | ||||||||||
Total organic change | 5 | % | ||||||||||||
Acquisition Activity | 1st Q 2026 | 1st Q 2025 | ||||||||||||
Number of acquisitions closed * | 8 | 10 | ||||||||||||
Estimated annualized revenues acquired (in millions) | $ | 49 | $ | 63 | ||||||||||
* In the first quarter of 2026 and 2025, Gallagher issued 76,000 shares and 49,000 shares, respectively, of its common stock directly to sellers in connection with tax-free exchange acquisitions.
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Brokerage Segment Reported GAAP to Adjusted Non-GAAP Reconciliations (continued) (dollars in millions):
See “Information Regarding Non-GAAP Measures” beginning on page 8 of 17.
| Compensation Expense and Ratios | 1st Q 2026 | 1st Q 2025 | ||||||||||||||||||
| Compensation expense, as reported | $ | 2,211 | $ | 1,617 | ||||||||||||||||
| Acquisition integration | (37) | (28) | ||||||||||||||||||
| Workforce and lease termination related charges | (24) | (16) | ||||||||||||||||||
| Acquisition related adjustments | (50) | (30) | ||||||||||||||||||
| Levelized foreign currency translation | – | 29 | ||||||||||||||||||
| Compensation expense, as adjusted | $ | 2,100 | $ | 1,572 | ||||||||||||||||
Reported compensation expense ratios using reported revenues on page 1 | * | 51.5 | % | 48.8 | % | |||||||||||||||
Adjusted compensation expense ratios using adjusted revenues on page 1 | ** | 49.0 | % | 46.7 | % | |||||||||||||||
* Reported first quarter 2026 compensation expense ratio was 2.7 pts higher than first quarter 2025. This ratio was primarily impacted by lower interest income revenues in the quarter, as first quarter 2025 included interest income earned on proceeds associated with the AssuredPartners Financing in December 2024. This ratio was also impacted by higher acquisition related adjustments and workforce termination costs, partially offset by savings from headcount controls.
** Adjusted first quarter 2026 compensation expense ratio was 2.3 pts higher than first quarter 2025. This ratio was primarily impacted by lower interest income revenues in the quarter, as first quarter 2025 included interest income earned on proceeds associated with the AssuredPartners Financing in December 2024. This ratio also benefited from savings from headcount controls.
Operating Expense and Ratios | 1st Q 2026 | 1st Q 2025 | ||||||||||||||||||
Operating expense, as reported | $ | 520 | $ | 346 | ||||||||||||||||
Acquisition integration | (50) | (16) | ||||||||||||||||||
Workforce and lease termination related charges | (3) | (2) | ||||||||||||||||||
Levelized foreign currency translation | – | 9 | ||||||||||||||||||
Operating expense, as adjusted | $ | 467 | $ | 337 | ||||||||||||||||
Reported operating expense ratios using reported revenues on page 1 | * | 12.1 | % | 10.5 | % | |||||||||||||||
Adjusted operating expense ratios using adjusted revenues on page 1 | ** | 10.9 | % | 10.0 | % | |||||||||||||||
* Reported first quarter 2026 operating expense ratio was 1.6 pts higher than first quarter 2025. This ratio was primarily impacted by higher integration and technology costs, partially offset by lower outside consulting fees. This ratio was also impacted by lower interest income revenues in the quarter, as first quarter 2025 included interest income earned on proceeds associated with the AssuredPartners Financing in December 2024.
** Adjusted first quarter 2026 operating expense ratio was 0.9 pts higher than first quarter 2025. This ratio was primarily impacted by increased technology costs, partially offset by lower outside consulting fees. This ratio was also impacted by lower interest income revenues in the quarter, as first quarter 2025 included interest income earned on proceeds associated with the AssuredPartners Financing in December 2024.
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Brokerage Segment Reported GAAP to Adjusted Non-GAAP Reconciliations (continued) (dollars in millions):
See “Information Regarding Non-GAAP Measures” beginning on page 8 of 17.
| Net Earnings to Adjusted EBITDAC (Non-GAAP) | 1st Q 2026 | 1st Q 2025 | ||||||||||||||||||
| Net earnings, as reported | $ | 913 | $ | 816 | ||||||||||||||||
| Provision for income taxes | 313 | 283 | ||||||||||||||||||
| Depreciation | 49 | 33 | ||||||||||||||||||
| Amortization | 271 | 204 | ||||||||||||||||||
| Change in estimated acquisition earnout payables | 16 | 15 | ||||||||||||||||||
| EBITDAC | 1,562 | 1,351 | ||||||||||||||||||
| Net (gains) on divestitures | (7) | (6) | ||||||||||||||||||
| Acquisition integration | 87 | 44 | ||||||||||||||||||
| Workforce and lease termination related charges | 27 | 18 | ||||||||||||||||||
| Acquisition related adjustments | 50 | 30 | ||||||||||||||||||
| Levelized foreign currency translation | – | 19 | ||||||||||||||||||
| EBITDAC, as adjusted | $ | 1,719 | $ | 1,456 | ||||||||||||||||
Net earnings margin, as reported using reported revenues on page 1 | * | 21.3 | % | 24.6 | % | |||||||||||||||
EBITDAC margin, as adjusted using adjusted revenues on page 1 | * | 40.1 | % | 43.3 | % | |||||||||||||||
* First quarter 2025 adjusted EBITDAC includes approximately $143 million of interest income revenues earned on the proceeds received in December 2024 related to the AssuredPartners Financing. The interest income in the prior period, as well as the seasonality of AssuredPartners and the roll-in of tuck-in acquisitions, unfavorably impacted the year over year change in first quarter adjusted EBITDAC margin by approximately 3.6%.
Risk Management Segment Reported GAAP to Adjusted Non-GAAP Reconciliations (dollars in millions):
See “Information Regarding Non-GAAP Measures” beginning on page 8 of 17.
Organic Revenues (Non-GAAP) | 1st Q 2026 | 1st Q 2025 | ||||||||||||
Fees | $ | 415 | $ | 363 | ||||||||||
International performance bonus fees | 5 | 2 | ||||||||||||
Fees as reported | 420 | 365 | ||||||||||||
Less fees from acquisitions, divestitures and other | (13) | (1) | ||||||||||||
Levelized foreign currency translation | – | 7 | ||||||||||||
Organic fees | 407 | 371 | ||||||||||||
Organic change in fees | 10 | % | ||||||||||||
Acquisition Activity | 1st Q 2026 | 1st Q 2025 | ||||||||||||
Number of acquisitions closed | 1 | 1 | ||||||||||||
Estimated annualized revenues acquired (in millions) | $ | 10 | $ | 38 | ||||||||||
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Risk Management Segment Reported GAAP to Adjusted Non-GAAP Reconciliations (continued) (dollars in millions):
See “Information Regarding Non-GAAP Measures” beginning on page 8 of 17.
Compensation Expense and Ratios | 1st Q 2026 | 1st Q 2025 | ||||||||||||||||||
Compensation expense, as reported | $ | 264 | $ | 231 | ||||||||||||||||
Acquisition integration | – | (1) | ||||||||||||||||||
Workforce and lease termination related charges | (1) | (3) | ||||||||||||||||||
Acquisition related adjustments | (6) | – | ||||||||||||||||||
Levelized foreign currency translation | – | 5 | ||||||||||||||||||
Compensation expense, as adjusted | $ | 257 | $ | 232 | ||||||||||||||||
Reported compensation expense ratios using reported revenues (before reimbursements) on page 1 | * | 61.8 | % | 61.9 | % | |||||||||||||||
Adjusted compensation expense ratios using adjusted revenues (before reimbursements) on page 1 | ** | 60.2 | % | 61.1 | % | |||||||||||||||
* Reported first quarter 2026 compensation expense ratio was 0.1 pts lower than first quarter 2025. This ratio was primarily impacted by savings related to headcount controls, partially offset by higher acquisition related adjustments and increased incentive compensation.
** Adjusted first quarter 2026 compensation expense ratio was 0.9 pts lower than first quarter 2025. This ratio was primarily impacted by savings related to headcount controls, partially offset by increased incentive compensation.
Operating Expense and Ratios | 1st Q 2026 | 1st Q 2025 | ||||||||||||||||||
Operating expense, as reported | $ | 78 | $ | 71 | ||||||||||||||||
Acquisition integration | (1) | (1) | ||||||||||||||||||
Levelized foreign currency translation | – | 1 | ||||||||||||||||||
Operating expense, as adjusted | $ | 77 | $ | 71 | ||||||||||||||||
Reported operating expense ratios using reported revenues (before reimbursements) on page 1 | * | 18.4 | % | 19.0 | % | |||||||||||||||
Adjusted operating expense ratios using reported revenues (before reimbursements) on page 1 | * | 18.1 | % | 18.5 | % | |||||||||||||||
* Reported first quarter 2026 operating expense ratio was 0.6 pts lower than first quarter 2025. Adjusted first quarter 2026 operating expense ratio was 0.4 pts lower than first quarter 2025. Both ratios were primarily impacted by savings in client-related expenses.
Net Earnings to Adjusted EBITDAC (Non-GAAP) | 1st Q 2026 | 1st Q 2025 | ||||||||||||
Net earnings, as reported | $ | 50 | $ | 41 | ||||||||||
Provision for income taxes | 18 | 15 | ||||||||||||
Depreciation | 10 | 10 | ||||||||||||
Amortization | 7 | 6 | ||||||||||||
Change in estimated acquisition earnout payables | 1 | – | ||||||||||||
EBITDAC | 86 | 72 | ||||||||||||
Acquisition integration | 1 | 2 | ||||||||||||
Workforce and lease termination related charges | 1 | 3 | ||||||||||||
Acquisition related adjustments | 6 | – | ||||||||||||
Levelized foreign currency translation | – | 1 | ||||||||||||
EBITDAC, as adjusted | $ | 94 | $ | 78 | ||||||||||
Net earnings margin, as reported using reported revenues (before reimbursements) on page 1 | 11.7 | % | 11.0 | % | ||||||||||
EBITDAC margin, as adjusted using adjusted revenues (before reimbursements) on page 1 | 21.7 | % | 20.4 | % | ||||||||||
5 of 17
Corporate Segment Reported GAAP to Adjusted Non-GAAP Reconciliation Information (dollars in millions):
See “Information Regarding Non-GAAP Measures” beginning on page 8 of 17.
1st Quarter | 2026 | 2025 | ||||||||||||||||||||||||||||||||||||
| Pretax Loss | Income Tax Benefit | Net Earnings (Loss) Attributable to Controlling Interests | Pretax Loss | Income Tax Benefit | Net Earnings (Loss) Attributable to Controlling Interests | |||||||||||||||||||||||||||||||||
| Components of Corporate Segment, as reported | ||||||||||||||||||||||||||||||||||||||
| Interest and banking costs | $ | (158) | $ | 41 | $ | (117) | $ | (159) | $ | 42 | $ | (117) | ||||||||||||||||||||||||||
| Clean energy-related | (7) | 2 | (5) | (2) | 1 | (1) | ||||||||||||||||||||||||||||||||
| Acquisition costs (1) | (10) | 2 | (8) | (26) | 3 | (23) | ||||||||||||||||||||||||||||||||
| Corporate (2) | (76) | 66 | (10) | (95) | 88 | (7) | ||||||||||||||||||||||||||||||||
Reported 1st quarter | (251) | 111 | (140) | (282) | 134 | (148) | ||||||||||||||||||||||||||||||||
| Adjustments | ||||||||||||||||||||||||||||||||||||||
| Clean energy-related (3) | 5 | (2) | 3 | – | – | – | ||||||||||||||||||||||||||||||||
| Transaction-related costs (1) | 7 | (1) | 6 | 23 | (3) | 20 | ||||||||||||||||||||||||||||||||
| Legal and tax related (4) | 18 | (17) | 1 | – | – | – | ||||||||||||||||||||||||||||||||
| Components of Corporate Segment, as adjusted | ||||||||||||||||||||||||||||||||||||||
| Interest and banking costs | (158) | 41 | (117) | (159) | 42 | (117) | ||||||||||||||||||||||||||||||||
| Clean energy-related | (2) | – | (2) | (2) | 1 | (1) | ||||||||||||||||||||||||||||||||
| Acquisition costs | (3) | 1 | (2) | (3) | – | (3) | ||||||||||||||||||||||||||||||||
| Corporate (2) | (58) | 49 | (9) | (95) | 88 | (7) | ||||||||||||||||||||||||||||||||
Adjusted 1st quarter | $ | (221) | $ | 91 | $ | (130) | $ | (259) | $ | 131 | $ | (128) | ||||||||||||||||||||||||||
(1)Gallagher incurred transaction-related costs, which include legal, consulting, employee compensation and other professional fees associated with completed, future and terminated acquisitions. Adjustments primarily relate to the acquisitions of AssuredPartners and Woodruff Sawyer, which closed August 2025 and April 2025, respectively.
(2)Corporate pretax loss includes a net unrealized foreign exchange remeasurement gain of $6 million in first quarter 2026 and a net unrealized foreign exchange remeasurement loss of $(23) million in first quarter 2025.
(3)Adjustments in first quarter 2026 include the write-down of a clean energy-related investment.
(4)Adjustments in first quarter 2026 and 2025 include costs associated with legal and tax matters.
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Interest, banking costs and debt - At March 31, 2026, Gallagher had $9,550 million of borrowings from public debt, $3,008 million of borrowings from private placements and $285 million of borrowings under its line of credit facility. In addition, Gallagher had $156 million outstanding under a revolving loan facility that provides funding for premium finance receivables, which are fully collateralized by the underlying premiums held by insurance carriers, and as such are excluded from its debt covenant computations, as applicable.
Clean energy-related - For 2026, this consists of operating results related to Gallagher’s investments in new clean energy projects, primarily fusion and carbon sequestration projects.
Acquisition costs - Consists mostly of external professional fees and other due diligence costs related to acquisitions. On occasion, Gallagher enters into forward currency hedges for the purchase price of committed, but not yet funded, acquisitions with funding requirements in currencies other than the U.S. dollar. The gains or losses, if any, associated with these hedge transactions are also included in acquisition costs.
Corporate - Consists of overhead allocations mostly related to corporate staff compensation, other corporate level activities, and net unrealized foreign exchange remeasurement. In addition, it includes the tax expense related to the partial taxation of foreign earnings, nondeductible executive compensation and entertainment expenses, the tax benefit from the vesting of employee equity awards, as well as other permanent or discrete tax items not reflected in the provision for income taxes in the Brokerage and Risk Management segments.
Income Taxes - Gallagher allocates the provision for income taxes to its Brokerage and Risk Management segments using the local country statutory rates. Gallagher’s consolidated effective tax rate for the quarters ended March 31, 2026 and 2025 were 21.1% and 18.8%, respectively.
AssuredPartners - In fourth quarter 2024 and first quarter 2025, we raised a total of approximately $14 billion of cash via a follow-on common stock offering and senior notes issuance to fund the AssuredPartners acquisition (collectively, the AssuredPartners Financing), which was completed in third quarter 2025 for approximately $14 billion.
Share Repurchases - In the first quarter of 2026, Gallagher repurchased approximately 1.4 million shares of its common stock for approximately $310 million.
Webcast Conference Call - Gallagher will host a webcast conference call on Thursday, April 30, 2026 at 5:15 p.m. ET/4:15 p.m. CT. To listen to this call, please go to Arthur J. Gallagher & Co. - Events & Presentations (ajg.com). The call will be available for replay at such website for at least 90 days.
About Arthur J. Gallagher & Co.
Arthur J. Gallagher & Co., a global insurance brokerage, risk management and consulting services firm, is headquartered in Rolling Meadows, Illinois. Gallagher provides these services in approximately 130 countries around the world through its owned operations and a network of correspondent brokers and consultants.
Information Concerning Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. When used in this press release, the words “anticipates,” “believes,” “contemplates,” “see,” “should,” “could,” “will,” “estimates,” “expects,” “intends,” “plans” and variations thereof and similar expressions, are intended to identify forward-looking statements. Examples of forward-looking statements include, but are not limited to, anticipated future results or performance of any segment or Gallagher as a whole; acquisition rollover revenues; statements regarding changes in its expenses in the next several quarters; future capital structure changes, including debt levels from time to time; the impact of foreign currency on its results; integration costs; workforce and lease termination costs; amortization of intangibles; depreciation; change in estimated earnout payables; effective tax rate; earnings from continuing operations attributable to noncontrolling interests; the premium rate environment and the state of insurance markets; and the economic environment.
Gallagher’s actual results may differ materially from those contemplated by the forward-looking statements. Readers are therefore cautioned against relying on any of the forward-looking statements, which are neither statements of historical fact nor guarantees or assurances of future performance.
Important factors that could cause actual results to differ materially from those in the forward-looking statements include global economic and geopolitical events, including, among others, fluctuations in interest and inflation rates; protectionism such as tariffs, trade disruptions; a recession or economic downturns; a U.S. government shutdown; political instability, such as global armed conflicts; its actual acquisition opportunities, including closing risks related to pending acquisitions; risks with respect to larger acquisitions such as AssuredPartners, the largest acquisition in our history, including risks related to its ability to successfully integrate operations; and the possibility that its assumptions may be inaccurate resulting in unforeseen obligations or liabilities and failure to realize expected benefits; damage to its reputation due to its failure to
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uphold its culture or negative perceptions or publicity, including as a result of amplifying effects that the Internet and social media may have on such perceptions; reputational issues related to its sustainability-related activities, including potential backlash against such activities, and compliance with increasingly complex climate- and other sustainability-related regulations, such as risks related to “greenwashing” and “greenhushing”; cybersecurity-related risks; its ability to apply technology, data analytics and artificial intelligence effectively and potential increased costs resulting from such activities; risks associated with the use of artificial intelligence in its business operations, including regulatory, data privacy, cybersecurity, errors and omissions, intellectual property and competition risks; risks related to “AI-washing”; heightened competition for talent and increased compensation costs; disasters or other business interruptions, including with respect to its operations in India; risks related to its international operations, such as those related to regulatory, tax, sustainability, sanctions and anti-corruption compliance and increased scrutiny of the use of off-shore centers of excellence such as those we operate in India and elsewhere; changes to data privacy and protection laws and regulations; foreign exchange rates; changes in accounting standards; changes in premium rates and in insurance markets generally, including the impact of large natural or man-made events; tax, environmental or other compliance risks related to its legacy clean energy investments; its inability to receive dividends or other distributions from subsidiaries; and changes in the insurance brokerage industry’s competitive landscape.
Please refer to Gallagher’s filings with the Securities and Exchange Commission, including Item 1A, “Risk Factors,” of its Annual Report on Form 10-K for the fiscal year ended December 31, 2025 and its subsequently filed Quarterly Reports on Form 10-Q for a more detailed discussion of these and other factors that could impact its forward-looking statements. Any forward-looking statement made by Gallagher in this press release speaks only as of the date on which it is made. Except as required by applicable law, Gallagher does not undertake to update the information included herein or the corresponding earnings release posted on Gallagher’s website.
Information Regarding Non-GAAP Measures
In addition to reporting financial results in accordance with GAAP, this press release provides information regarding EBITDAC, EBITDAC margin, adjusted EBITDAC, adjusted EBITDAC margin, diluted net earnings per share, as adjusted (adjusted EPS), adjusted revenue, adjusted compensation and operating expenses, adjusted compensation expense ratio, adjusted operating expense ratio and organic revenue. These measures are not in accordance with, or an alternative to, the GAAP information provided in this press release. Gallagher’s management believes that these presentations provide useful information to management, analysts and investors regarding financial and business trends relating to Gallagher’s results of operations and financial condition or because they provide investors with measures that its chief operating decision maker uses when reviewing Gallagher’s performance. See further below for definitions and additional reasons each of these measures is useful to investors. Gallagher’s industry peers may provide similar supplemental non-GAAP information with respect to one or more of these measures, although they may not use the same or comparable terminology and may not make identical adjustments. The non-GAAP information provided by Gallagher should be used in addition to, but not as a substitute for, the GAAP information provided. As disclosed in its most recent Proxy Statement, Gallagher makes determinations regarding certain elements of executive officer incentive compensation, performance share awards and annual cash incentive awards, partly on the basis of measures related to adjusted EBITDAC.
Adjusted Non-GAAP presentation - Gallagher believes that the adjusted non-GAAP presentations of the current and prior period information presented in this earnings release provide stockholders and other interested persons with useful information regarding certain financial metrics of Gallagher that may assist such persons in analyzing Gallagher’s operating results as they develop a future earnings outlook for Gallagher. The after-tax amounts related to the adjustments were computed using the normalized effective tax rate for each respective period. See pages 16 and 17 for a reconciliation of the adjustments made to income taxes.
Adjusted measures - Revenues (for the Brokerage segment), revenues before reimbursements (for the Risk Management segment), net earnings, compensation expense and operating expense, respectively, each adjusted to exclude the following, as applicable:
•Net gains (losses) on divestitures, which are primarily net proceeds received related to sales of books of business and other divestiture transactions, such as the disposal of a business through sale or closure.
•Acquisition integration costs, which include costs related to certain large acquisitions (including the acquisitions of the Willis Towers Watson treaty reinsurance brokerage operations, Buck, Cadence Insurance, Eastern Insurance Group, My Plan Manager, Woodruff Sawyer and AssuredPartners), outside the scope of the usual tuck-in strategy, not expected to occur on an ongoing basis in the future once Gallagher fully assimilates the applicable acquisition. These costs are typically associated with redundant workforce, compensation expense related to amortization of certain retention bonus arrangements, extra lease space, duplicate services and external costs incurred to assimilate the acquisition into its IT related systems.
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•Transaction-related costs, which are associated with completed, future and terminated acquisitions. Costs primarily relate to the acquisitions of AssuredPartners and Woodruff Sawyer, which closed in and August 2025 and April 2025, respectively. These include costs related to regulatory filings, legal and accounting services, insurance and incentive compensation.
•Workforce related charges, which primarily include severance costs (either accrued or paid) related to employee terminations and other costs associated with redundant workforce.
•Lease termination related charges, which primarily include costs related to terminations of real estate leases and abandonment of leased space.
•Acquisition related adjustments principally relate to changes in estimated acquisition earnout payables adjustments and acquisition related compensation charges. In addition, from time to time we may include changes in balance sheet estimates arising from conforming accounting principles, purchase-related true-ups and other balance sheet adjustments made after the closing date.
•Amortization of intangible assets, which reflects the amortization of customer/expiration lists, non-compete agreements, trade names and other intangible assets acquired through Gallagher’s merger and acquisition strategy, the impact to amortization expense of acquisition valuation adjustments to these assets as well as non-cash impairment charges.
•The impact of foreign currency translation, as applicable. The amounts excluded with respect to foreign currency translation are calculated by applying current year foreign exchange rates to the same period in the prior year.
•Effective income tax rate impact, which levelizes the prior year for the change in current year tax rates.
•Clean energy-related, which represents the impact of adjustments in first quarter 2026 related to the write-down of a clean energy-related investment.
•Legal and tax related, which represents the impact of adjustments in first quarter 2026 and 2025 related to costs associated with legal and tax matters.
•Adjusted ratios - Adjusted compensation expense and adjusted operating expense, respectively, each divided by adjusted revenues.
Non-GAAP Earnings Measures
•EBITDAC and EBITDAC margin - EBITDAC is net earnings before interest, income taxes, depreciation, amortization and the change in estimated acquisition earnout payables and EBITDAC margin is EBITDAC divided by total revenues (for the Brokerage segment) and revenues before reimbursements (for the Risk Management segment). These measures for the Brokerage and Risk Management segments provide a meaningful representation of Gallagher’s operating performance for the overall business and provide a meaningful way to measure its financial performance on an ongoing basis.
•EBITDAC, as Adjusted and EBITDAC Margin, as Adjusted - Adjusted EBITDAC is EBITDAC adjusted to exclude net gains on divestitures, acquisition integration costs, workforce related charges, lease termination related charges, acquisition related adjustments, transaction related costs, and the period-over-period impact of foreign currency translation, as applicable, and Adjusted EBITDAC margin is Adjusted EBITDAC divided by total adjusted revenues (defined above). These measures for the Brokerage and Risk Management segments provide a meaningful representation of Gallagher’s operating performance and are also presented to improve the comparability of its results between periods by eliminating the impact of the items that have a high degree of variability.
•EPS, as Adjusted and Net Earnings, as Adjusted - Adjusted net earnings have been adjusted to exclude the after-tax impact of net gains on divestitures, acquisition integration costs, the impact of foreign currency translation, workforce related charges, lease termination related charges, acquisition related adjustments, transaction related costs, amortization of intangible assets, and effective income tax rate impact, as applicable. Adjusted EPS is Adjusted Net Earnings divided by diluted weighted average shares outstanding. This measure provides a meaningful representation of Gallagher’s operating performance (and as such should not be used as a measure of Gallagher’s liquidity), and for the overall business is also presented to improve the comparability of its results between periods by eliminating the impact of the items that have a high degree of variability.
Organic Revenues (a non-GAAP measure) - Organic revenue change measures the year-over-year percentage change in organic revenue. For the Brokerage segment, organic revenue consists of base commission and fee revenues, supplemental revenues and contingent revenues, excluding the first twelve months of such revenues generated from acquisitions and such revenues related to divested operations, which include disposals of a business through sale or closure, estimate changes, run-off of a business and the restructuring and/or repricing of programs and products, in each year presented. Such revenues are excluded from organic revenues in order to help interested persons analyze the revenue growth associated with the operations that were a part of Gallagher in both the current and prior period. In order to improve the comparability of Gallagher’s results between periods, we further exclude the period-over-period impact of
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foreign currency translation; revenue from certain large life product sales within Gallagher’s Executive Life and Benefits practice group (which are typically large singular transactions with a high degree of variability in amount and timing); and revenue attributable to changes in assumptions used to calculate estimated deferred revenues, which impact the quarterly timing of revenues during the annual contract period. For the Risk Management segment, organic revenue consists of fee revenues excluding the first twelve months of such revenues generated from acquisitions and such revenues related to divested operations in each period presented. In order to improve the comparability of Gallagher’s results between periods, we further exclude the period-over-period impact of foreign currency translation .
These revenue items are excluded from organic revenues in order to determine a comparable, but non-GAAP, measurement of revenue growth that is associated with the revenue sources that are expected to continue in the current year and beyond, as well as eliminating the impact of the items that have a high degree of variability. Gallagher has historically viewed organic revenue growth as an important indicator when assessing and evaluating the performance of its Brokerage and Risk Management segments. Gallagher also believes that using this non-GAAP measure allows readers of its financial statements to measure, analyze and compare the growth from its Brokerage and Risk Management segments in a meaningful and consistent manner.
Reconciliation of Non-GAAP Information Presented to GAAP Measures - This press release includes tabular reconciliations to the most comparable GAAP measures, as follows: for EBITDAC (on pages 4 and 5), for adjusted revenues, adjusted EBITDAC and adjusted diluted net earnings per share (on page 1), for organic revenue measures (on pages 2 and 4, respectively, for the Brokerage and Risk Management segments), for adjusted compensation and operating expenses and adjusted EBITDAC margin (on pages 3, 4 and 5 respectively, for the Brokerage and Risk Management segments).
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Arthur J. Gallagher & Co.
Reported Statement of Earnings and EBITDAC - 1st Quarter March 31,
(Unaudited - in millions except per share, percentage and workforce data)
| Brokerage Segment | 1st Q Ended March 31, 2026 | 1st Q Ended March 31, 2025 | |||||||||
| Commissions | $ | 3,123 | $ | 2,249 | |||||||
| Fees | 792 | 620 | |||||||||
| Supplemental revenues | 180 | 114 | |||||||||
| Contingent revenues | 115 | 93 | |||||||||
| Interest income, premium finance revenues and other income | 83 | 238 | |||||||||
| Total revenues | 4,293 | 3,314 | |||||||||
| Compensation | 2,211 | 1,617 | |||||||||
| Operating | 520 | 346 | |||||||||
| Depreciation | 49 | 33 | |||||||||
| Amortization | 271 | 204 | |||||||||
| Change in estimated acquisition earnout payables | 16 | 15 | |||||||||
| Expenses | 3,067 | 2,215 | |||||||||
| Earnings before income taxes | 1,226 | 1,099 | |||||||||
| Provision for income taxes | 313 | 283 | |||||||||
| Net earnings | 913 | 816 | |||||||||
| Net earnings attributable to noncontrolling interests | 1 | 5 | |||||||||
| Net earnings attributable to controlling interests | $ | 912 | $ | 811 | |||||||
| EBITDAC | |||||||||||
| Net earnings | $ | 913 | $ | 816 | |||||||
| Provision for income taxes | 313 | 283 | |||||||||
| Depreciation | 49 | 33 | |||||||||
| Amortization | 271 | 204 | |||||||||
| Change in estimated acquisition earnout payables | 16 | 15 | |||||||||
| EBITDAC | $ | 1,562 | $ | 1,351 | |||||||
See "Information Regarding Non-GAAP Measures" beginning on page 8 of 17.
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Arthur J. Gallagher & Co.
Reported Statement of Earnings and EBITDAC - 1st Quarter March 31,
(Unaudited - in millions except per share, percentage and workforce data)
| Risk Management Segment | 1st Q Ended March 31, 2026 | 1st Q Ended March 31, 2025 | |||||||||
| Fees | $ | 420 | $ | 365 | |||||||
| Interest income and other income | 8 | 9 | |||||||||
| Revenues before reimbursements | 428 | 374 | |||||||||
| Reimbursements | 42 | 39 | |||||||||
| Total revenues | 470 | 413 | |||||||||
| Compensation | 264 | 231 | |||||||||
| Operating | 78 | 71 | |||||||||
| Reimbursements | 42 | 39 | |||||||||
| Depreciation | 10 | 10 | |||||||||
| Amortization | 7 | 6 | |||||||||
| Change in estimated acquisition earnout payables | 1 | — | |||||||||
| Expenses | 402 | 357 | |||||||||
| Earnings before income taxes | 68 | 56 | |||||||||
| Provision for income taxes | 18 | 15 | |||||||||
| Net earnings | 50 | 41 | |||||||||
| Net earnings attributable to noncontrolling interests | – | – | |||||||||
| Net earnings attributable to controlling interests | $ | 50 | $ | 41 | |||||||
| EBITDAC | |||||||||||
| Net earnings | $ | 50 | $ | 41 | |||||||
| Provision for income taxes | 18 | 15 | |||||||||
| Depreciation | 10 | 10 | |||||||||
| Amortization | 7 | 6 | |||||||||
| Change in estimated acquisition earnout payables | 1 | – | |||||||||
| EBITDAC | $ | 86 | $ | 72 | |||||||
See "Information Regarding Non-GAAP Measures" beginning on page 8 of 17.
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Arthur J. Gallagher & Co.
Reported Statement of Earnings and EBITDAC - 1st Quarter March 31,
(Unaudited - in millions except share and per share data)
| Corporate Segment | 1st Q Ended March 31, 2026 | 1st Q Ended March 31, 2025 | |||||||||
| Other loss | $ | (5) | $ | – | |||||||
| Total revenues | (5) | – | |||||||||
| Compensation | 41 | 49 | |||||||||
| Operating | 45 | 73 | |||||||||
| Interest | 158 | 158 | |||||||||
| Depreciation | 2 | 2 | |||||||||
| Expenses | 246 | 282 | |||||||||
| Loss before income taxes | (251) | (282) | |||||||||
| Benefit for income taxes | (111) | (134) | |||||||||
| Net loss | (140) | (148) | |||||||||
| Net loss attributable to noncontrolling interests | – | – | |||||||||
| Net loss attributable to controlling interests | $ | (140) | $ | (148) | |||||||
| EBITDAC | |||||||||||
| Net loss | $ | (140) | $ | (148) | |||||||
| Benefit for income taxes | (111) | (134) | |||||||||
| Interest | 158 | 158 | |||||||||
| Depreciation | 2 | 2 | |||||||||
| EBITDAC | $ | (91) | $ | (122) | |||||||
See "Information Regarding Non-GAAP Measures" beginning on page 8 of 17.
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Arthur J. Gallagher & Co.
Reported Statement of Earnings and EBITDAC - 1st Quarter March 31,
(Unaudited - in millions except share and per share data)
| Total Company | 1st Q Ended March 31, 2026 | 1st Q Ended March 31, 2025 | |||||||||
| Commissions | $ | 3,123 | $ | 2,249 | |||||||
| Fees | 1,212 | 985 | |||||||||
| Supplemental revenues | 180 | 114 | |||||||||
| Contingent revenues | 115 | 93 | |||||||||
| Interest income, premium finance revenues and other income | 86 | 247 | |||||||||
| Revenues before reimbursements | 4,716 | 3,688 | |||||||||
| Reimbursements | 42 | 39 | |||||||||
| Total revenues | 4,758 | 3,727 | |||||||||
| Compensation | 2,516 | 1,897 | |||||||||
| Operating | 643 | 490 | |||||||||
| Reimbursements | 42 | 39 | |||||||||
| Interest | 158 | 158 | |||||||||
| Depreciation | 61 | 45 | |||||||||
| Amortization | 278 | 210 | |||||||||
| Change in estimated acquisition earnout payables | 17 | 15 | |||||||||
| Expenses | 3,715 | 2,854 | |||||||||
| Earnings before income taxes | 1,043 | 873 | |||||||||
| Provision for income taxes | 220 | 164 | |||||||||
| Net earnings | 823 | 709 | |||||||||
| Net earnings attributable to noncontrolling interests | 1 | 5 | |||||||||
| Net earnings attributable to controlling interests | $ | 822 | $ | 704 | |||||||
| Diluted net earnings per share | $ | 3.16 | $ | 2.72 | |||||||
| Dividends declared per share | $ | 0.70 | $ | 0.65 | |||||||
| EBITDAC | |||||||||||
| Net earnings | $ | 823 | $ | 709 | |||||||
| Provision for income taxes | 220 | 164 | |||||||||
| Interest | 158 | 158 | |||||||||
| Depreciation | 61 | 45 | |||||||||
| Amortization | 278 | 210 | |||||||||
| Change in estimated acquisition earnout payables | 17 | 15 | |||||||||
| EBITDAC | $ | 1,557 | $ | 1,301 | |||||||
See "Information Regarding Non-GAAP Measures" beginning on page 8 of 17.
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Arthur J. Gallagher & Co.
Consolidated Balance Sheet
(Unaudited - in millions except per share data)
| March 31, 2026 | Dec 31, 2025 | ||||||||||
| Cash and cash equivalents | $ | 1,413 | $ | 1,396 | |||||||
| Fiduciary assets (includes fiduciary cash of $7,069 in 2026 and $7,142 in 2025) | 33,873 | 26,899 | |||||||||
| Accounts receivable, net | 5,960 | 5,175 | |||||||||
| Other current assets | 773 | 886 | |||||||||
| Total current assets | 42,019 | 34,356 | |||||||||
| Fixed assets - net | 762 | 789 | |||||||||
| Deferred income taxes | 43 | 43 | |||||||||
| Other noncurrent assets | 1,568 | 1,602 | |||||||||
| Right-of-use assets | 585 | 598 | |||||||||
| Goodwill | 22,958 | 22,593 | |||||||||
| Amortizable intangible assets - net | 10,366 | 10,684 | |||||||||
| Total assets | $ | 78,301 | $ | 70,665 | |||||||
| Fiduciary liabilities | $ | 33,873 | $ | 26,899 | |||||||
| Accrued compensation and other current liabilities | 4,051 | 4,017 | |||||||||
| Deferred revenue - current | 809 | 737 | |||||||||
| Premium financing debt | 156 | 226 | |||||||||
| Corporate related borrowings - current | 640 | 640 | |||||||||
| Total current liabilities | 39,529 | 32,519 | |||||||||
| Corporate related borrowings - noncurrent | 12,077 | 12,104 | |||||||||
| Deferred revenue - noncurrent | 177 | 155 | |||||||||
| Lease liabilities - noncurrent | 499 | 515 | |||||||||
| Other noncurrent liabilities (includes tax credit carryforwards of $655 in 2026 and $713 in 2025) | 2,217 | 2,025 | |||||||||
| Total liabilities | 54,499 | 47,318 | |||||||||
| Stockholders' equity: | |||||||||||
| Common stock - issued and outstanding | 257 | 257 | |||||||||
| Capital in excess of par value | 17,638 | 17,783 | |||||||||
| Retained earnings | 6,446 | 5,806 | |||||||||
| Accumulated other comprehensive loss | (566) | (525) | |||||||||
| Total controlling interests stockholders' equity | 23,775 | 23,321 | |||||||||
| Noncontrolling interests | 27 | 26 | |||||||||
| Total stockholders' equity | 23,802 | 23,347 | |||||||||
| Total liabilities and stockholders' equity | $ | 78,301 | $ | 70,665 | |||||||
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Arthur J. Gallagher & Co.
Other Information
(Unaudited - data is rounded where indicated)
| OTHER INFORMATION | 1st Q Ended March 31, 2026 | 1st Q Ended March 31, 2025 | |||||||||
| Basic weighted average shares outstanding (000s) | 257,119 | 254,819 | |||||||||
| Diluted weighted average shares outstanding (000s) | 259,816 | 259,421 | |||||||||
| Number of common shares outstanding at end of period (000s) | 256,942 | 256,053 | |||||||||
| Workforce at end of period (includes acquisitions): | |||||||||||
| Brokerage | 55,607 | * | 43,120 | ||||||||
| Risk Management | 11,122 | 10,594 | |||||||||
| Total Company | 72,373 | * | 57,285 | ||||||||
* The acquisition of AssuredPartners added approximately 10,900 employees in August 2025.
Reconciliation of Non-GAAP Measures - Pre-tax Earnings and Diluted Net Earnings per Share (Unaudited)
(Unaudited - in millions except share and per share data)
| Earnings (Loss) Before Income Taxes | Provision (Benefit) for Income Taxes | Net Earnings (Loss) | Net Earnings (Loss) Attributable to Noncontrolling Interests | Net Earnings (Loss) Attributable to Controlling Interests | Diluted Net Earnings (Loss) per Share | |||||||||||||||||||||||||||||||||
| 1st Q Ended March 31, 2026 | ||||||||||||||||||||||||||||||||||||||
| Brokerage, as reported | $ | 1,226 | $ | 313 | $ | 913 | $ | 1 | $ | 912 | $ | 3.51 | ||||||||||||||||||||||||||
| Net (gains) on divestitures | (7) | (2) | (5) | – | (5) | (0.02) | ||||||||||||||||||||||||||||||||
| Acquisition integration | 87 | 22 | 65 | – | 65 | 0.25 | ||||||||||||||||||||||||||||||||
| Workforce and lease termination | 27 | 7 | 20 | – | 20 | 0.08 | ||||||||||||||||||||||||||||||||
| Acquisition related adjustments | 53 | 14 | 39 | – | 39 | 0.15 | ||||||||||||||||||||||||||||||||
| Amortization of intangible assets | 271 | 70 | 201 | – | 201 | 0.77 | ||||||||||||||||||||||||||||||||
| Brokerage, as adjusted | $ | 1,657 | $ | 424 | $ | 1,233 | $ | 1 | $ | 1,232 | $ | 4.74 | ||||||||||||||||||||||||||
| Risk Management, as reported | $ | 68 | $ | 18 | $ | 50 | $ | – | $ | 50 | $ | 0.19 | ||||||||||||||||||||||||||
| Acquisition integration | 1 | – | 1 | – | 1 | – | ||||||||||||||||||||||||||||||||
| Workforce and lease termination | 1 | – | 1 | – | 1 | – | ||||||||||||||||||||||||||||||||
| Acquisition related adjustments | 6 | 2 | 4 | – | 4 | 0.02 | ||||||||||||||||||||||||||||||||
| Amortization of intangible assets | 7 | 2 | 5 | – | 5 | 0.02 | ||||||||||||||||||||||||||||||||
| Risk Management, as adjusted | $ | 83 | $ | 22 | $ | 61 | $ | – | $ | 61 | $ | 0.23 | ||||||||||||||||||||||||||
| Corporate, as reported | $ | (251) | $ | (111) | $ | (140) | $ | – | $ | (140) | $ | (0.54) | ||||||||||||||||||||||||||
| Transaction-related costs | 7 | 1 | 6 | – | 6 | 0.02 | ||||||||||||||||||||||||||||||||
| Legal and tax related | 18 | 17 | 1 | – | 1 | – | ||||||||||||||||||||||||||||||||
| Clean energy-related | 5 | 2 | 3 | – | 3 | 0.02 | ||||||||||||||||||||||||||||||||
| Corporate, as adjusted | $ | (221) | $ | (91) | $ | (130) | $ | – | $ | (130) | $ | (0.50) | ||||||||||||||||||||||||||
See "Information Regarding Non-GAAP Measures" beginning on page 8 of 17.
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Reconciliation of Non-GAAP Measures - Pre-tax Earnings and Diluted Net Earnings per Share (Unaudited) - Continued
(Unaudited - in millions except share and per share data)
| Earnings (Loss) Before Income Taxes | Provision (Benefit) for Income Taxes | Net Earnings (Loss) | Net Earnings (Loss) Attributable to Noncontrolling Interests | Net Earnings (Loss) Attributable to Controlling Interests | Diluted Net Earnings (Loss) per Share | |||||||||||||||||||||||||||||||||
| 1st Q Ended March 31, 2025 | ||||||||||||||||||||||||||||||||||||||
| Brokerage, as reported | $ | 1,099 | $ | 283 | $ | 816 | $ | 5 | $ | 811 | $ | 3.13 | ||||||||||||||||||||||||||
| Net (gains) on divestitures | (6) | (2) | (4) | – | (4) | (0.02) | ||||||||||||||||||||||||||||||||
| Acquisition integration | 44 | 11 | 33 | – | 33 | 0.13 | ||||||||||||||||||||||||||||||||
| Workforce and lease termination | 18 | 4 | 14 | – | 14 | 0.05 | ||||||||||||||||||||||||||||||||
| Acquisition related adjustments | 33 | 8 | 25 | – | 25 | 0.09 | ||||||||||||||||||||||||||||||||
| Amortization of intangible assets | 204 | 52 | 152 | – | 152 | 0.59 | ||||||||||||||||||||||||||||||||
| Effective income tax impact | — | (1) | 1 | – | 1 | – | ||||||||||||||||||||||||||||||||
| Levelized foreign currency translation | 17 | 4 | 13 | – | 13 | 0.05 | ||||||||||||||||||||||||||||||||
| Brokerage, as adjusted | $ | 1,409 | $ | 359 | $ | 1,050 | $ | 5 | $ | 1,045 | $ | 4.02 | ||||||||||||||||||||||||||
| Risk Management, as reported | $ | 56 | $ | 15 | $ | 41 | $ | – | $ | 41 | $ | 0.16 | ||||||||||||||||||||||||||
| Acquisition integration | 2 | 1 | 1 | – | 1 | – | ||||||||||||||||||||||||||||||||
| Workforce and lease termination | 3 | – | 3 | – | 3 | 0.01 | ||||||||||||||||||||||||||||||||
| Amortization of intangible assets | 6 | 2 | 4 | – | 4 | 0.02 | ||||||||||||||||||||||||||||||||
| Levelized foreign currency translation | 1 | – | 1 | – | 1 | – | ||||||||||||||||||||||||||||||||
| Risk Management, as adjusted | $ | 68 | $ | 18 | $ | 50 | $ | – | $ | 50 | $ | 0.19 | ||||||||||||||||||||||||||
| Corporate, as reported | $ | (282) | $ | (134) | $ | (148) | $ | – | $ | (148) | $ | (0.57) | ||||||||||||||||||||||||||
| Transaction-related costs | 23 | 3 | 20 | – | 20 | 0.08 | ||||||||||||||||||||||||||||||||
| Corporate, as adjusted | $ | (259) | $ | (131) | $ | (128) | $ | – | $ | (128) | $ | (0.49) | ||||||||||||||||||||||||||
See "Information Regarding Non-GAAP Measures" on page 8 of 17.
Contact:
Sara Walsh
630-285-3593 or sara_walsh@ajg.com
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FAQ
How did Arthur J. Gallagher & Co. (AJG) perform financially in Q1 2026?
Arthur J. Gallagher & Co. reported higher Q1 2026 results, with revenues before reimbursements of $4.716 billion versus $3.688 billion last year. Net earnings reached $823 million and diluted EPS rose to $3.16 from $2.72, reflecting stronger overall performance.
What were AJG’s adjusted earnings and EBITDAC for Q1 2026?
For Q1 2026, Arthur J. Gallagher & Co. reported adjusted EBITDAC of $1.752 billion, up from $1.435 billion. Adjusted diluted EPS increased to $4.47 from $3.72. These non‑GAAP figures exclude items such as acquisition integration costs, divestiture gains and amortization of intangibles.
How strong was AJG’s organic revenue growth in Q1 2026?
Organic growth remained solid. In the brokerage segment, total organic commissions, fees, supplemental and contingent revenues rose to $3.208 billion from $3.067 billion, a 5% increase. In the risk management segment, organic fees increased to $407 million from $371 million, representing 10% growth.
What did management highlight about AJG’s Q1 2026 performance?
Management described Q1 2026 as a “terrific” quarter, noting 28% revenue growth for the combined brokerage and risk management segments. They cited 5% organic growth, 12% net earnings growth and 18% adjusted EBITDAC growth, marking the 24th consecutive quarter of double‑digit adjusted EBITDAC growth.
How did AJG’s balance sheet look at March 31, 2026?
At March 31, 2026, Arthur J. Gallagher & Co. reported total assets of $78.301 billion and total liabilities of $54.499 billion. Stockholders’ equity was $23.802 billion. Corporate-related borrowings totaled $12.717 billion across current and noncurrent portions, alongside significant fiduciary assets and liabilities.