What changed in this filing

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Item 1. Financial Statements

2025-10-30 compared with 2025-07-31 · 158 added, 140 removed, 551 unchanged (35% of the section changed)

3 unchanged sentences

(In thousands)

September 30,

2025 December 31,

53 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

6 unchanged sentences

Interest expense ( 27,960 ) ( 4,968 ) ( 80,983 ) ( 15,363 )

Gain on sale of operations, net 1,124 4,953 1,124 4,953

Other income, net 8,378 1,300 31,786 13,207

2 unchanged sentences

Income tax expense 10,260 15,887 76,234 51,417

Net Income $ 41,942 $ 19,793 164,715 96,677

$ 30,146 $ 35,084 $ 194,861 $ 131,761

Earnings per share:

5 unchanged sentences

Net income $ 30,146 $ 35,084 $ 194,861 $ 131,761

Other comprehensive (loss) income, net of tax ( 2,115 ) ( 142 ) ( 3,350 ) 876

Other comprehensive loss, net of tax

( 1,242 ) ( 2,497 ) ( 4,592 ) ( 1,621 )

Comprehensive income $ 28,904 $ 32,587 $ 190,269 $ 130,140

10 unchanged sentences

Comprehensive

Income (Loss) Total

March 31, 2025 141,924 87,835 $ 1,420 $ 1,812,729 $ 1,018,895 $ ( 918,327 ) $ ( 16 ) $ 1,914,701

June 30, 2025 142,851 88,827 $ 1,429 $ 1,821,388 $ 1,060,837 $ ( 989,680 ) $ ( 2,131 ) $ 1,891,843

Net income — — — — 30,146 — — 30,146

5 unchanged sentences

Business acquisitions 905 — 9 181 — — — 190

June 30, 2025 142,851 88,827 $ 1,429 $ 1,821,388 $ 1,060,837 $ ( 989,680 ) $ ( 2,131 ) $ 1,891,843

September 30, 2025 143,757 89,653 $ 1,438 $ 1,828,903 $ 1,090,983 $ ( 1,046,152 ) $ ( 3,373 ) $ 1,871,799

Shares Treasury

6 unchanged sentences

Income (Loss) Total

March 31, 2024 137,855 87,743 $ 1,379 $ 841,268 $ 931,968 $ ( 910,322 ) $ 2,796 $ 867,089

June 30, 2024 137,905 87,743 $ 1,379 $ 845,962 $ 951,761 $ ( 910,322 ) $ 2,654 $ 891,434

Net income — — — — 35,084 — — 35,084

Other comprehensive loss, net of tax — — — — — — ( 2,497 ) ( 2,497 )

Indirect repurchase of shares for minimum tax withholding — 3 — — — ( 215 ) — ( 215 )

Restricted stock units and awards 6 — — — — — — —

1 unchanged sentence

Business acquisitions 23 — — 1,699 — — — 1,699

June 30, 2024 137,905 87,743 $ 1,379 $ 845,962 $ 951,761 $ ( 910,322 ) $ 2,654 $ 891,434

September 30, 2024 137,934 87,746 $ 1,379 $ 850,076 $ 986,845 $ ( 910,537 ) $ 157 $ 927,920

See the accompanying notes to the unaudited condensed consolidated financial statements

16 unchanged sentences

Business acquisitions 5,588 — 56 17,469 — — — 17,525

June 30, 2025 142,851 88,827 $ 1,429 $ 1,821,388 $ 1,060,837 $ ( 989,680 ) $ ( 2,131 ) $ 1,891,843

September 30, 2025 143,757 89,653 $ 1,438 $ 1,828,903 $ 1,090,983 $ ( 1,046,152 ) $ ( 3,373 ) $ 1,871,799

Shares Treasury

5 unchanged sentences

Comprehensive

Income (Loss) Total

December 31, 2023 137,387 87,573 $ 1,374 $ 832,475 $ 855,084 $ ( 899,093 ) $ 1,778 $ 791,618

Net income — — — — 131,761 — — 131,761

Other comprehensive income, net of tax — — — — — — 876 876

Other comprehensive loss, net of tax — — — — — — ( 1,621 ) ( 1,621 )

Indirect repurchase of shares for minimum tax withholding — 173 — — — ( 11,444 ) — ( 11,444 )

3 unchanged sentences

Business acquisitions 150 — 1 10,174 — — — 10,175

June 30, 2024 137,905 87,743 $ 1,379 $ 845,962 $ 951,761 $ ( 910,322 ) $ 2,654 $ 891,434

September 30, 2024 137,934 87,746 $ 1,379 $ 850,076 $ 986,845 $ ( 910,537 ) $ 157 $ 927,920

See the accompanying notes to the unaudited condensed consolidated financial statements

2 unchanged sentences

(In thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

Cash flows from operating activities:

Net income $ 194,861 $ 131,761

Adjustments to reconcile net income to net cash used in operating activities:

Adjustments to reconcile net income to net cash provided by operating activities:

Gain on sale of operations, net of tax

( 1,124 ) ( 4,953 )

Depreciation and amortization expense 74,313 28,593

29 unchanged sentences

Payment of contingent consideration for acquisitions and client lists ( 55,825 ) ( 50,861 )

Other, net ( 436 ) —

Net cash used in financing activities ( 75,233 ) ( 85,222 )

32 unchanged sentences

The Captive Insurance Company recognizes premium as revenue monthly as monthly coverage expires.

For the three and six months ended June 30, 2025, revenue from the Captive Insurance Company was not material.

For the three and nine months ended September 30, 2025, revenue from the Captive Insurance Company was not material.

Basis of Consolidation:

24 unchanged sentences

We plan to adopt the guidance for the fiscal year ending December 31, 2025.

We are currently evaluating the effect adoption of this ASU will have on our consolidated financial statements.

We are currently evaluating the effect of adopting this ASU will have on our consolidated financial statements.

In November 2024, the FASB issued ASU No.

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We are currently evaluating the effect of adopting this ASU will have on our consolidated financial statements.

In July 2025, the FASB issued ASU No.

2025-05, Financial Instruments-Credit Losses (Topic 326):

Measurement of Credit Losses for Accounts Receivable and Contract Assets (“ASU 2025-05”).

This standard introduces a practical expedient for all entities when estimating expected credit losses on current accounts receivable and contract assets arising from transactions under ASC Topic 606.

Under the practical expedient, entities may assume that conditions at the balance sheet date remain unchanged over the life of the asset, reducing the need to prepare complex macroeconomic forecasts for short-term balances.

ASU 2025-05 is effective for public companies with annual periods beginning after December 15, 2025, and interim periods within such fiscal years, with prospective application required.

Early adoption is permitted.

We do not expect adoption of ASU 2025-05 to have a material impact on our consolidated financial statements.

In September 2025, the FASB issued ASU No.

2025-06, Intangibles - Goodwill and Other Internal-Use Software (Subtopic 350-40):

Targeted Improvement to the Accounting for Internal-Use Software ("ASU

This ASU modernizes the recognition and disclosure framework for internal-use software by removing all references to software project development stages and providing new guidance on how to evaluate whether the probable-to-complete recognition threshold has been met.

This ASU is effective for annual periods beginning after December 15, 2027, and interim periods within those annual reporting periods.

We plan to adopt the guidance for the fiscal year ending December 31, 2028.

We are currently evaluating the effect of adopting this ASU will have on our consolidated financial statements.

BUSINESS COMBINATIONS

2 unchanged sentences

The acquisition is referred to herein as the “Transaction”.

During the six months ended June 30, 2025, the Company’s condensed consolidated statement of comprehensive income included $ 579.6 million of revenue and $ 119.1 million of operating income associated with the results of operations of Marcum.

During the nine months ended September 30, 2025, the Company’s Condensed Consolidated Statements of Comprehensive Income included $ 840.0 million of revenue and $ 162.3 million of operating income associated with the results of operations of Marcum.

Stock Consideration Transferred

At closing, the purchase price for the purpose of the Transaction consisted of an aggregate of $ 1,063.0 million of cash consideration and $ 934.7 million of the Company’s common stock, which represents a fair value of 13.6 million shares issued as stock consideration.

Pursuant to the terms of the Transaction, with respect to the 13.6 million shares of stock consideration, approximately 4.9 million shares, in

aggregate, were delivered from January 2, 2025 to July 1, 2025 to the selling shareholders.

The remaining 8.7 million shares will be delivered in 29 monthly installments starting on August 1, 2025.

At closing, the purchase price for the Transaction consisted of an aggregate of $ 1,063.0 million of cash consideration and $ 934.7 million of the Company’s common stock, which represents a fair value of 13.6 million shares issued as stock consideration.

Pursuant to the terms of the Transaction, with respect to the 13.6 million shares of stock consideration, approximately 5.8 million shares, in aggregate, were delivered from January 2, 2025 to October 1, 2025 to the selling shareholders.

The remaining 7.8 million shares will be delivered in 26 monthly installments starting on November 3, 2025.

Measurement Period Adjustments

1 unchanged sentence

As the Company finalizes the estimation of the fair value of the assets acquired and liabilities assumed, additional adjustments may be recorded during the measurement period (a period not to exceed 12 months from the acquisition date).

During the six months ended June 30, 2025, the Company reassessed its estimates and inputs as new information about facts and circumstances that existed as of the acquisition date became known.

As a result, the Company recorded a $ 23.0 million reduction in goodwill as a measurement period adjustment.

The reduction to goodwill consists of a $ 21.0 million adjustment reflecting a reduction of the estimated settlement amounts associated with an acquired liability from $ 61.0 million to $ 40.0 million and a $ 2.0 million net increase in assets acquired.

In the process, the Company also recorded a $ 8.7 million increase to goodwill as a result of recording an assumed liability associated with certain accrued personnel obligations previously unrecognized on the provisional opening balance sheet.

During the nine months ended September 30, 2025, the Company reassessed its estimates and inputs as new information about facts and circumstances that existed as of the acquisition date became known.

As a result, the Company recorded a $ 5.8 million net reduction in goodwill as a measurement period adjustment.

The Company also recorded a $ 10.6 million increase to goodwill associated with accrued personnel costs, primarily as a result of recording an assumed liability associated with certain accrued personnel obligations previously unrecognized on the provisional opening balance sheet, and a $ 4.6 million increase to goodwill from a net decrease in assets acquired.

The income statement impact, had those adjustments been made as of the acquisition date, was considered immaterial.

2 unchanged sentences

Total consideration transferred

Asset acquired:

Assets acquired:

Account receivable 169,391

5 unchanged sentences

Deferred income taxes, net 3,533

Total identifiable asset acquired 910,130

Total identifiable assets acquired

Liabilities assumed:

11 unchanged sentences

The final determination of the fair value of certain assets and liabilities will be completed as soon as the necessary information, such as final working capital adjustments, becomes available but no later than one year from the acquisition date.

Refer to the Annual Report on Form 10-K for the year ended December 31, 2024 for further discussion of the Transaction.

Refer to Note 2, Business Combinations, to the consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2024 for further discussion of the Transaction.

ACCOUNTS RECEIVABLE, NET

3 unchanged sentences

Receivables are charged-off against the allowance when the balance is deemed uncollectible.

Accounts receivable, net, at June 30, 2025 and December 31, 2024 was as follows (in thousands):

Accounts receivable, net, at September 30, 2025 and December 31, 2024 was as follows (in thousands):

September 30,

2025 December 31,

4 unchanged sentences

Accounts receivable, net $ 719,554 $ 534,858

Changes to the allowance for doubtful accounts for the six months ended June 30, 2025 and year ended December 31, 2024 were as follows (in thousands):

Changes to the allowance for doubtful accounts for the nine months ended September 30, 2025 and year ended December 31, 2024 were as follows (in thousands):

September 30,

2025 December 31,

5 unchanged sentences

2024 Credit Facilities - Our primary debt financing arrangement is the Amended and Restated Credit Agreement, dated as of November 1, 2024, as amended by the First Amendment, dated as of March 7, 2025, by and among the Company, CBIZ, Inc.

as the borrower, the lenders party thereto from time to time and Bank of America, N.A., as the agent, which provides $ 2.0 billion in senior secured credit facilities, consisting of term loans with an original principle amount of $ 1.4 billion (the “Term Loan”) and a $ 600.0 million revolving credit facility (the “Revolving Credit Facility” and, together with the Term Loan, as may be further amended, restated, supplemented or otherwise modified from time to time, the "2024 Credit Facilities").

as the borrower, the lenders party thereto from time to time and Bank of America, N.A., as the agent, which provides $ 2.0 billion in senior secured credit facilities, consisting of term loans with an original principal amount of $ 1.4 billion (the “Term Loan”) and a $ 600.0 million revolving credit facility (the “Revolving Credit Facility” and, together with the Term Loan, as may be further amended, restated, supplemented or otherwise modified from time to time, the "2024 Credit Facilities").

On April 29, 2025, the Company entered into a Second Amendment (the "Debt Amendment") to the 2024 Credit Facilities.

The Debt Amendment added a usual and customary "Available Amount" basket available for making of certain investments and/or restricted payments (including share repurchases) from time to time subject to the satisfaction of certain terms and conditions set forth therein and made certain other technical changes.

The changes from the Debt Amendment have been accounted for as a modification under ASC 470, Debt ("ASC 470") and had an immaterial impact to the financial statements.

The changes resulting from the Debt Amendment were accounted for as a modification under ASC 470, Debt ("ASC 470") with an immaterial impact to the financial statements.

Th e 2024 Credit Facilities mature on November 1, 2029.

The Term Loan provides for scheduled annual principal amortization payments of 5 % in the first two years following closing, 7.5 % annually in the third and fourth year following closing and 10 % in the fifth year following closing, with the balance due at maturity.

The 2024 Credit Facilities contains certain restrictive covenants customary for facilities of this type, including restrictions on indebtedness, liens or other encumbrances, making certain payments, investments, or to sell or otherwise dispose of a substantial portion of assets, or to merge or consolidate

with an unaffiliated entity.

The 2024 Credit Facilities contain certain restrictive covenants customary for facilities of this type, including restrictions on indebtedness, liens or other encumbrances, making certain payments, investments, or to sell or otherwise dispose of a substantial portion of assets, or to merge or consolidate with an unaffiliated entity.

The 2024 Credit Facilities also limit our ability to make dividend payments.

2 unchanged sentences

The 2024 Credit Facilities contain a provision that, in the event of a defined change in control, the 2024 Credit Facilities may be terminated.

In addition, the 2024 Credit Facilities includes a financial covenant requiring that Total Net Leverage Ratio not exceed 5.00 to 1.00 initially, stepping down in increments to 3.75 to 1.00 during and after the seventh fiscal quarter after the closing (with a limited ability to temporarily increase in connection with material acquisitions commencing in the sixth fiscal quarter after the closing).

The 2024 Credit Facilities also require a Minimum Consolidated Interest Coverage Ratio of 3.00 to 1.00 and affirmative and negative covenants that are in each case generally similar to those contained in our previous amended and stated 2022 credit facility, but with increases to certain baskets and caps and certain other exceptions.

As of June 30, 2025 , we were in compliance with all covenants.

The balance outstanding under the 2024 Credit Facilities at June 30, 2025 and December 31, 2024 was as follows (in thousands):

June 30, 2025 December 31, 2024

In addition, the 2024 Credit Facilities include a financial covenant requiring that Total Net Leverage Ratio not exceed 5.00 to 1.00 initially, stepping down in increments to 3.75 to 1.00 during and after the seventh fiscal quarter after the closing (with a limited ability to temporarily increase in connection with material acquisitions commencing in the sixth fiscal quarter after the closing).

and restated 2022 credit facility, but with increases to certain baskets and caps and certain other exceptions.

As of September 30, 2025, we were in compliance with all covenants under the 2024 Credit Facilities.

The balance outstanding under the 2024 Credit Facilities at September 30, 2025 and December 31, 2024 was as follows (in thousands):

September 30, 2025 December 31, 2024

Short-term debt

Current portion, Term Loan

$ 70,000 $ 70,000

Current portion debt issuance costs, Term Loan ( 3,677 ) ( 3,823 )

4 unchanged sentences

Long-term portion, Term Loan

1,277,500 1,330,000

Long-term portion Debt Issuance Costs, Term Loan

( 7,242 ) ( 9,985 )

Total long-term debt $ 1,502,639 $ 1,333,755

The blended effective interest rates under the 2024 Credit Facilities and the 2022 Credit Facility, including the impact of interest rate swaps associated with those credit facilities, for the six months ended June 30, 2025 and 2024 were as follows:

Six Months Ended

The blended effective interest rates under the 2024 Credit Facilities and the 2022 credit facility, including the impact of interest rate swaps associated with those credit facilities, for the nine months ended September 30, 2025 and 2024 were as follows:

Nine Months Ended

September 30,

Weighted average rates 6.64 % 5.40 %

1 unchanged sentence

1.93 % - 6.83 %

We had approximately $ 370 million of available funds under the 2024 Credit Facilities at June 30, 2025, based on the terms of the commitment.

We had approximately $ 316.0 million of available funds under the 2024 Credit Facilities at September 30, 2025, based on the terms of the commitment.

Available funds under the 2024 Credit Facilities are based on a multiple of earnings before interest, taxes, depreciation and amortization as defined in the 2024 Credit Facilities, and are reduced by letters of credit, other indebtedness and outstanding borrowings under the 2024 Credit Facilities.

Under the 2024 Credit Facilities, loans are charged an interest rate consisting of a base rate or term SOFR rate plus an applicable margin, letters of credit are charged based on the same applicable margin, and a commitment fee is charged on the unused portion of the 2024 Credit Facilities.

Refer to the Annual Report on Form 10-K for the year ended December 31, 2024 for further discussion on the 2024 Credit Facilities and the 2022 credit facility.

Refer to Note 10, Debt and Financing Arrangements, to the consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2024 for further discussion on the 2024 Credit Facilities and the 2022 credit facility.

Other Line of Credit - We have an unsecured $ 20.0 million line of credit by and among CBIZ Benefits and Insurance, Inc.

and Huntington National Bank ("line of credit").

We utilize this line of credit to support our short-term funding requirements of payroll client fund obligations due to the investment of client funds, rather than liquidating client funds that have already been invested in available-for-sale

The line of credit did no t have a balance outstanding at June 30, 2025 or December 31, 2024.

The line of credit did no t have a balance outstanding at September 30, 2025 or December 31, 2024.

The line of credit was renewed in July 2025 and will now terminate on July 30, 2026.

Interest Expense - Interest expense, including amortization of deferred financing costs, commitment fees, line of credit fees, and other applicable bank charges, for the three and six months ended June 30, 2025 and 2024 was as follows (in thousands):

Three months ended June 30, Six months ended June 30,

Interest Expense - Interest expense, including amortization of deferred financing costs, commitment fees, line of credit fees, and other applicable bank charges, for the three and nine months ended September 30, 2025 and 2024 was as follows (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

3 unchanged sentences

COMMITMENTS AND CONTINGENCIES

Letters of Credit and Guarantees - We provide letters of credit to landlords (lessors) of our leased premises in lieu of cash security deposits, which totaled $ 3.2 million and $ 3.2 million at June 30, 2025 and December 31, 2024, respectively.

In addition, we provide license bonds to various state agencies to meet certain licensing requirements.

The amount of license bonds outstanding was $ 2.2 million and $ 2.2 million at June 30, 2025 and December 31, 2024, respectively.

Legal Proceedings - On December 19, 2016, CBIZ Operations, Inc.

("CBIZ Operations") was named as a defendant in a lawsuit filed by Zotec Partners, LLC (“Zotec”) in the Marion County Indiana Superior Court.

After various amendments, the lawsuit asserted claims under Indiana law for securities, statutory and common law fraud or deception, unjust enrichment, breach of contract, and vicarious liability against CBIZ Operations and a former employee of CBIZ MMP in connection with the sale of the CBIZ MMP medical billing practice to Zotec.

The plaintiff claimed that CBIZ Operations had a duty to disclose the fact, unknown to employees of CBIZ Operations at the time of the transaction, that the former employee of CBIZ MMP had a financial arrangement with a Zotec vendor at the time CBIZ Operations sold CBIZ MMP to Zotec.

The plaintiff sought damages of up to $ 177.0 million out of the $ 200.0 million transaction price.

Trial was held in October 2021.

The jury found in favor of CBIZ on all fraud, contract and other claims before it.

On November 14, 2022, the trial court ruled in favor of CBIZ and against Zotec’s claim for statutory securities fraud.

The court also ruled in favor of CBIZ on its counterclaim for indemnification under contract.

The trial court conducted a hearing on December 12, 2023, to consider evidence regarding the amount of damages owed by Zotec to CBIZ on the counterclaim.

On March 12, 2024, the court awarded CBIZ $ 3.1 million on its counterclaim.

On April 10, 2024, Zotec filed a notice of appeal.

On April 8, 2025, the Court of Appeals affirmed the trial court's dismissal of the securities fraud claim against CBIZ.

The Court of Appeals reversed the award to CBIZ on its counterclaim.

Both CBIZ and Zotec opted against appealing this decision, rendering the decision final.

On November 10, 2023, CBIZ was named as a defendant in a putative class action lawsuit in the United States District Court for the District of Massachusetts by an individual claiming to be an employee of a CBIZ client whose personally identifiable information (“PII”) was compromised and stolen during a cyberattack CBIZ experienced on or about May 31, 2023.

The amount of license bonds outstanding was $ 2.2 million and $ 2.2 million at September 30, 2025 and December 31, 2024, respectively.

Legal Proceedings - On November 10, 2023, CBIZ was named as a defendant in a putative class action lawsuit in the United States District Court for the District of Massachusetts by an individual claiming to be an employee of a CBIZ client whose personally identifiable information (“PII”) was compromised and stolen during a cyberattack CBIZ experienced on or about May 31, 2023.

As a result of this incident, hackers were able to access and download certain files from CBIZ’s MOVEit Transfer server.

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MOVEit Customer Data Security Breach Litigation, pending in the United States District Court for the District of Massachusetts (the “MDL”).

To date, the MDL has over 180 cases against over 100 different defendants, all with claims arising out of the cyberbreach by hackers of Progress Software Corporation’s MOVEit Transfer

To date, the MDL has over 180 cases against over 100 different defendants, all with claims arising out of the cyberbreach by hackers of Progress Software Corporation’s MOVEit Transfer software.

The cases in the MDL, including the cases against CBIZ, are in their earliest stages, with a stay in place until the MDL Court issues a scheduling order.

1 unchanged sentence

In June of 2025, the Company settled litigation against a small group of former employees.

As part of the settlement of that litigation, the Company received a settlement payment of $ 12.5 million, which was recorded as a pre-tax gain in “Other income, net” on the consolidated statements of comprehensive income for the three and six months ended June 30, 2025.

As part of the settlement of that litigation, the Company received a settlement payment of $ 12.5 million, which was recorded as a pre-tax gain in “Other income, net” on the Condensed Consolidated Statements of Comprehensive Income for the nine months ended September 30, 2025.

In addition to the items disclosed above, the Company is, from time to time, subject to claims and lawsuits arising in the ordinary course of business.

1 unchanged sentence

Although the proceedings are subject to uncertainties in the litigation process and the ultimate disposition of these proceedings is not presently determinable, we intend to vigorously defend these matters.

Refer to the Annual Report on Form 10-K for the year ended December 31, 2024 for further discussion on the Company's commitments and contingencies.

Refer to Note 12, Commitments and Contingencies, to the consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2024 for further discussion on the Company's commitments and contingencies.

FINANCIAL INSTRUMENTS

1 unchanged sentence

These funds held for clients are segregated and invested in accordance with our investment policy, which requires all investments carry an investment grade rating at the time of initial investment.

These investments, primarily consisting of corporate and municipal bonds, are classified as available-for-sale and are included in the “Funds held for clients” line item on the accompanying unaudited Condensed Consolidated Balance Sheets.

The par value of these investments totaled $ 39.0 million and $ 41.3 million at June 30, 2025 and December 31, 2024, respectively, and these investments have maturity or callable dates ranging from July 2025 through February 2028.

At June 30, 2025, unrealized losses on the securities were not material and have not been recognized as a credit loss because the bonds are investment grade quality and management is not required or does not intend to sell prior to an expected recovery in value.

Consolidated Balance Sheets.

The par value of these investments totaled $ 45.3 million and $ 41.3 million at September 30, 2025 and December 31, 2024, respectively, and these investments have maturity or callable dates ranging from October 2025 through February 2030.

At September 30, 2025, unrealized losses on the securities were not material and have not been recognized as a credit loss because the bonds are investment grade quality and management is not required or does not intend to sell prior to an expected recovery in value.

The bond issuers continue to make timely principal and interest payments.

The following table summarizes activities related to these investments for the six months ended June 30, 2025 and the year ended December 31, 2024 (in thousands):

Six Months Ended June 30, 2025 Year Ended December 31, 2024

The following table summarizes activities related to these investments for the nine months ended September 30, 2025 and the year ended December 31, 2024 (in thousands):

Nine Months Ended September 30, 2025 Year Ended December 31, 2024

Fair value at beginning of period $ 40,999 $ 39,459

5 unchanged sentences

Fair value at end of period $ 45,159 $ 40,999

In addition to the available-for-sale debt securities discussed above, we also held other depository assets in the amount of $ 2.4 million and $ 0.2 million at June 30, 2025 and December 31, 2024, respectively.

In addition to the available-for-sale debt securities discussed above, we also held other depository assets in the amount of $ 0.2 million and $ 0.2 million at September 30, 2025 and December 31, 2024, respectively.

Those depository assets are classified as Level 1 in the fair value hierarchy.

1 unchanged sentence

We do not purchase or hold any derivative instruments for trading or speculative purposes.

Refer to the Annual Report on Form 10-K for the year ended December 31, 2024 for further discussion on our interest rate swaps.

The following table summarizes our outstanding interest rate swaps and their classification in the accompanying unaudited Condensed Consolidated Balance Sheets at June 30, 2025 and December 31, 2024 (amounts in thousands):

June 30, 2025

Refer to Note 7, Financial Instruments, to the consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2024 for further discussion on our interest rate swaps.

The following table summarizes our outstanding interest rate swaps and their classification in the accompanying unaudited Condensed Consolidated Balance Sheets at September 30, 2025 and December 31, 2024 (amounts in thousands, except percentages):

September 30, 2025

Amount Fixed Rate Expiration Fair

Value Balance Sheet Location

Interest rate swap (1)

$ 100,000 4.047 % 7/14/2026 $ ( 294 ) Other current liability

Interest rate swap $ 30,000 1.186 % 12/14/2026 $ 829 Other non-current asset

Interest rate swap (1)

$ 100,000 3.850 % 7/14/2027 $ ( 828 ) Other non-current liability

Interest rate swap $ 20,000 2.450 % 8/14/2027 $ 330 Other non-current asset

7 unchanged sentences

$ 50,000 3.680 % 7/15/2030 $ ( 753 ) Other non-current liability

(1) Entered into during the second quarter of 2025.

(1) Entered into during the third quarter of 2025.

December 31, 2024

7 unchanged sentences

Refer to Note 8, Fair Value Measurements, for additional disclosures regarding fair value measurements.

The following table summarizes the effects of the interest rate swaps on the accompanying unaudited Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2025 and 2024 (in thousands):

Gain (Loss) Recognized

in AOCI, net of tax Gain Reclassified

The following table summarizes the effects of the interest rate swaps on the accompanying Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2025 and 2024 (in thousands):

Loss Recognized

in AOCI, net of tax

Gain Reclassified

from AOCI into Expense

Three Months Ended

June 30, Three Months Ended

September 30, Three Months Ended

September 30,

2025 2024 2025 2024

Interest rate swaps $ ( 636 ) $ ( 1,818 ) $ 846 $ 1,186

Gain (Loss) Recognized

in AOCI, net of tax Gain Reclassified

(Loss) Gain Recognized

in AOCI, net of tax

Gain Reclassified

from AOCI into Expense

Six months ended June 30, Six months ended June 30,

Nine Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

1 unchanged sentence

FAIR VALUE MEASUREMENTS

The following table summarizes our assets and (liabilities) at June 30, 2025 and December 31, 2024, respectively, that are measured at fair value on a recurring basis subsequent to initial recognition and indicates the fair value hierarchy of the valuation techniques utilized by us to determine such fair value (in thousands):

Level June 30, 2025 December 31, 2024

The following table summarizes our assets and (liabilities) at September 30, 2025 and December 31, 2024, respectively, that are measured at fair value on a recurring basis subsequent to initial recognition and indicates the fair value hierarchy of the valuation techniques utilized by us to determine such fair value (in thousands):

Level September 30, 2025 December 31, 2024

Assets of deferred compensation plan 1 $ 181,127 $ 167,170

3 unchanged sentences

Interest rate swaps 2 $ ( 3,635 ) $ 2,681

Bank debt 2 $ ( 1,554,489 ) $ ( 1,399,932 )

Bank debt, net

2 $ ( 1,568,962 ) $ ( 1,399,932 )

Contingent purchase price liabilities 3 $ ( 41,257 ) $ ( 96,967 )

During the six months ended June 30, 2025 and 2024, there were no transfers between the valuation hierarchy Levels 1, 2 and 3.

The following table summarizes the change in Level 3 fair values of our contingent purchase price liabilities for the six months ended June 30, 2025 and 2024 (pre-tax basis, in thousands):

During the nine months ended September 30, 2025 and 2024, there were no transfers between the valuation hierarchy Levels 1, 2 and 3.

The following table summarizes the change in Level 3 fair values of our contingent purchase price liabilities for the nine months ended September 30, 2025 and 2024 (pre-tax basis, in thousands):

Beginning balance – December 31 $ ( 96,967 ) $ ( 114,946 )

Additions from business acquisitions ( 2,941 ) ( 15,184 )

Contingent purchase price liabilities assumed — ( 5,231 )

Settlement of contingent purchase price liabilities 60,635 58,468

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Change in net present value of contingencies ( 2,154 ) ( 1,625 )

Ending balance – June 30 $ ( 48,733 ) $ ( 83,839 )

The following table summarizes the changes in contingent purchase price consideration for previous acquisitions and contingent payments made for previous business acquisitions in the three and six months ended June 30, 2025 and 2024, respectively (in thousands):

Three Months Ended June 30, Six Months Ended June 30,

Ending balance – September 30 $ ( 41,257 ) $ ( 78,002 )

The following table summarizes the changes in contingent purchase price consideration for previous acquisitions and contingent payments made for previous business acquisitions in the three and nine months ended September 30, 2025 and 2024, respectively (in thousands):

Three Months Ended September 30, Nine Months Ended September 30,

2025 2024 2025 2024

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Shares issued (number) 13 23 60 117

Refer to the Annual Report on Form 10-K for the year ended December 31, 2024 for further discussion on the fair value measurements and classification of our financial assets and liabilities.

Refer to Note 8, Fair Value Measurements, to the consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2024 for further discussion on the fair value measurements and classification of our financial assets and liabilities.

OTHER COMPREHENSIVE INCOME

The following table is a summary of other comprehensive income and discloses the tax impact of each component of other comprehensive (loss) income for the three and six months ended June 30, 2025 and 2024 (in thousands):

The following table is a summary of other comprehensive income and discloses the tax impact of each component of other comprehensive (loss) income for the three and nine months ended September 30, 2025 and 2024 (in thousands):

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

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$ 35 $ 215 $ 158 $ 438

Net unrealized (loss) gain on interest rate swaps, net of taxes (2)

Net unrealized (loss) on interest rate swaps, net of taxes (2)

( 1,271 ) ( 2,709 ) ( 4,736 ) ( 2,041 )

Foreign currency translation ( 6 ) ( 3 ) ( 14 ) ( 18 )

Total other comprehensive (loss) income, net of tax $ ( 2,115 ) $ ( 142 ) $ ( 3,350 ) $ 876

(1) Net of income tax expense of $ 22 and $ 68 for the three months ended June 30, 2025 and 2024, respectively.

Net of income tax expense of $ 51 and $ 89 for the six months ended June 30, 2025 and 2024, respectively.

(2) Net of income tax benefit of $ 722 and $ 99 for the three months ended June 30, 2025 and 2024, respectively.

Net of income tax benefit of $ 1,156 and income tax expense of $ 223 for the six months ended June 30, 2025 and 2024, respectively.

Common Stock Issued for the Transaction - Pursuant to the Agreement and Plan of Merger, dated as of July 30, 2024, by and among the Company, Marcum and the other parties thereto (the “Merger Agreement”) and as part of the total purchase price consideration we issued shares to the selling shareholders in the Transaction.

Total other comprehensive (loss), net of tax

$ ( 1,242 ) $ ( 2,497 ) $ ( 4,592 ) $ ( 1,621 )

(1) Net of income tax expense of $ 12 and $ 85 for the three months ended September 30, 2025 and 2024, respectively.

Net of income tax expense of $ 63 and $ 174 for the nine months ended September 30, 2025 and 2024, respectively.

(2) Net of income tax benefit of $ 422 and $ 903 for the three months ended September 30, 2025 and 2024, respectively.

Net of income tax benefit of $ 1,578 and $ 680 for the nine months ended September 30, 2025 and 2024, respectively.

Common Stock Issued for the Transaction - Pursuant to the Agreement and Plan of Merger, dated as of July 30, 2024, by and among the Company, Marcum and the other parties thereto (the “Merger Agreement”) and as part of the total purchase price consideration, we issued shares of our common stock to the selling shareholders in the Transaction.

Refer to Note 3, Business Combinations, for more detail.

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Share Repurchase Program - Over the past twenty years , our Board of Directors has annually renewed the Company’s share repurchase program, which permits the Company to repurchase, in accordance with SEC rules, up to 5 million shares of our outstanding common stock (i) in the open market, (ii) in privately negotiated transactions, or (iii) under Rule 10b5-1 trading plans (the “Share Repurchase Program”).

The Board of Directors authorized the Share Repurchase Program on February 7, 2024, permitting repurchases through March 31, 2025, and February 11, 2025, permitting repurchases through March 31, 2026.

The Board of Directors authorized the Share Repurchase Program on February 11, 2025, permitting repurchases through March 31, 2026.

Privately negotiated transactions may include repurchases from employees, officers and directors and repurchases from former partners of Marcum pursuant to the ROFR Agreement, as discussed above.

Refer to Note 14, Common Stock, to the consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2024 for more detail about the Share Repurchase Program.

We repurchased 1.0 million shares of our common stock at of $ 71.3 million under the ROFR Agreement during the six months ended June 30, 2025.

Additionally, to settle statutory employee withholding related to vesting of stock awards, we repurchased 0.1 million shares of our common stock at cost of $ 7.8 million during the six months ended June 30, 2025 and 0.2 million shares at a cost of $ 11.2 million during the six months ended June 30, 2024.

We repurchased 1.4 million shares of our common stock for a total cost of $ 102.8 million under the ROFR Agreement and 0.4 million shares of our common stock in the open market for $ 25.0 million during the nine months ended September 30, 2025.

Additionally, to settle statutory employee withholdings related to vesting of stock awards, we repurchased 0.1 million shares of our common stock at a cost of $ 7.8 million during the nine months ended September 30, 2025 and 0.2 million shares at a cost of $ 11.4 million during the nine months ended September 30, 2024.

EMPLOYEE STOCK PLANS

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Refer to Note 15, Employee Stock Plans to the consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2024 for further discussion on the 2019 Plan.

Compensation expense for stock-based awards recognized during the three and six months ended June 30, 2025 and 2024 was as follows (in thousands):

Compensation expense for stock-based awards recognized during the three and nine months ended September 30, 2025 and 2024 was as follows (in thousands):

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

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Total stock-based compensation expense $ 7,334 $ 2,415 $ 19,573 $ 7,431

Stock Options and Restricted Stock Units and Awards – The Company did no t grant any stock options, no r were any stock options exercised during the six months ended June 30, 2025.

As of June 30, 2025, we have 150 thousand stock options outstanding with a weighted average exercise price per share of $ 35.22 .

The following table presents our restricted stock units and awards activity during the six months ended June 30, 2025 (in thousands, except per share unit data):

Stock Options and Restricted Stock Units and Awards – The Company did no t grant any stock options, no r were any stock options exercised during the nine months ended September 30, 2025.

As of September 30, 2025, we have 150 thousand stock options outstanding with a weighted average exercise price per share of $ 35.22 .

The following table presents our restricted stock units and awards activity during the nine months ended September 30, 2025 (in thousands, except per share unit data):

Restricted Stock Units and Awards

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Expired or canceled ( 8 ) $ 80.59

Outstanding at June 30, 2025 922 $ 70.37

Outstanding at September 30, 2025 923 $ 70.35

(1) Represents weighted average market value of the shares;

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For the PSUs granted in 2025, the recipients may earn additional shares of stock, not to exceed 300 % of the number of PSUs initially granted if performance achieved above specified levels.

The following table presents our PSUs activity during the six months ended June 30, 2025 (in thousands, except per share unit data):

The following table presents our PSUs activity during the nine months ended September 30, 2025 (in thousands, except per share unit data):

Share Units Weighted

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Adjustments for performance results 25 $ 49.49

Outstanding at June 30, 2025 239 $ 65.80

Outstanding at September 30, 2025 267 $ 63.99

(1) Represents weighted average market value of the PSUs;

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EARNINGS PER SHARE

The following table sets forth the computation of basic and diluted earnings per share for the three and six months ended June 30, 2025 and 2024 (in thousands, except per share data):

The following table sets forth the computation of basic and diluted earnings per share for the three and nine months ended September 30, 2025 and 2024 (in thousands, except per share data):

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2025 2024 2025 2024

Net Income $ 41,942 $ 19,793 $ 164,715 $ 96,677

$ 30,146 $ 35,084 $ 194,861 $ 131,761

Weighted average common shares outstanding (1)

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152 74 170 76

Performance share units 116 96 116 96

Contingent shares (3)

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Diluted earnings per share $ 0.48 $ 0.70 $ 3.06 $ 2.62

(1) A total of 13.6 million shares that were issued as consideration in connection with the Transaction are included for the three and six months ended June 30, 2025.

(1) A total of 13.6 million shares that were issued as consideration in connection with the Transaction are included for the three and nine months ended September 30, 2025.

Refer to Note 3, Business Combinations for more detail.

(2) A total of 63 thousand and 79 thousand shares of stock-based awards were excluded from the calculation of diluted earnings per share for the three and six months ended June 30, 2025, as their effect would be anti-dilutive.

A total of 9 thousand and 96 thousand shares of stock-based awards were excluded from the calculation of diluted earnings per share for the three and six months ended June 30, 2024,as their effect would be anti-dilutive.

(2) A total of 103 thousand and 73 thousand shares of stock-based awards were excluded from the calculation of diluted earnings per share for the three and nine months ended September 30, 2025, respectively, as their effect would be anti-dilutive.

A total of 8 thousand and 49 thousand shares of stock-based awards were excluded from the calculation of diluted earnings per share for the three and nine months ended September 30, 2024, respectively, as their effect would be anti-dilutive.

(3) Contingent shares represent additional shares to be issued for purchase price earned by former owners of businesses acquired by us once future conditions have been met.

(4) The denominator used in calculating diluted earnings per share did not include 239 thousand and 254 thousand PSUs for both the three and six months ended June 30, 2025, and 2024, respectively.

The performance conditions associated with these PSUs were not met and consequently none of these PSUs were considered as issuable for the three and six months ended June 30, 2025 and 2024.

(4) The denominator used in calculating diluted earnings per share did not include 151 thousand PSUs for both the three and nine months ended September 30, 2025.

The denominator used in calculating diluted earnings per share did not include 158 thousand PSUs for both the three and nine months ended September 30, 2024.

The performance conditions associated with

these PSUs were not met and consequently none of these PSUs were considered as issuable for the three and nine months ended September 30, 2025 and 2024.

SEGMENT DISCLOSURES

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The business units are managed along these segment lines.

Refer to the Annual Report on Form 10-K for the year ended December 31, 2024 for further discussion on the segment lines.

Refer to Note 19, Segment Disclosure, to the consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31, 2024 for further discussion on the segment lines.

Corporate and Other - Included in Corporate and Other are operating expenses that are not directly allocated to the individual business units.

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Performance of the practice groups is evaluated on income (loss) before income tax expense (benefit) excluding those costs listed above, which are reported in “Corporate and Other”.

The practice groups respective revenue and pre-tax income, significant segment expenses, and a reconciliation of segment profit or loss measure to the consolidated income before income tax expense for the three and six months ended June 30, 2025 and 2024 is presented below.

The practice groups respective revenue and pre-tax income, significant segment expenses, and a reconciliation of segment profit or loss measure to the consolidated income before income tax expense for the three and nine months ended September 30, 2025 and 2024 is presented below.

We do not manage our assets on a segment basis, therefore segment assets are not presented below.

Segment information for the three and six months ended June 30, 2025 and 2024 was as follows (in thousands):

Three months ended June 30, 2025

Segment information for the three and nine months ended September 30, 2025 and 2024 was as follows (in thousands):

Three Months Ended September 30, 2025

Services Benefits and

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Consolidated income before income tax expense $ 40,406

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Services Benefits and

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Consolidated income before income tax expense $ 50,971

Six months ended June 30, 2025

Nine Months Ended September 30, 2025

Services Benefits and

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Consolidated income before income tax expense $ 271,095

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Services Benefits and

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(1) Other costs, gains, and losses, net primarily consist of travel and entertainment costs, computer and technology related costs, depreciation and amortization expenses, and other discretionary costs.

SUBSEQUENT EVENTS

On July 4, 2025, the U.S.

government enacted The One Big Beautiful Bill Act of 2025 which includes, among other provisions, changes to the U.S.

corporate income tax system such as permanent extensions of certain expiring provisions of the Tax Cuts and Jobs Act and restoration of favorable tax

treatment for certain business provisions.

Certain provisions are effective for us beginning in 2025.

We are currently assessing its impact on our consolidated financial statements.

On July 9, 2025, we entered into an 18-month interest rate swap with a notional value of $ 100 million and a fixed rate of 3.85 %.

The interest rate swap expires on January 14, 2027.

On July 15, 2025, we entered into a 1-year interest rate swap with a notional value of $ 100 million and a fixed rate of 4.047 %.

The interest rate swap expires on July 14, 2026.

Subsequent to June 30, 2025 and up to July 25, we repurchase approximately 0.3 million shares of our common stock under the ROFR Agreement at a total cost of approximately $ 25.3 million.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements