Key financial results

  • Consolidated revenue for the third quarter was $6.9 billion, an increase of 8% on a reported basis and 5% on an underlying basis.Consolidated revenue increased 8% to $6.9 billion or an increase of 5% on an underlying basis
  • Adjusted operating income grew 6% to $1.5 billion, with an adjusted operating margin of 22.7%.Our adjusted operating margin was 22.7%.
  • Adjusted EPS was $2.03 per share, representing a 10% increase year-over-year, while GAAP EPS was $1.69 per share.adjusted EPS was $2.03, up 10% year-over-year.
  • For the first nine months of 2026, adjusted operating income grew 7% to $6.1 billion, and adjusted EPS increased 9% to $8.29 per share.Adjusted operating income grew 7% to $6.1 billion. Our adjusted operating margin was 28.1% and adjusted EPS increased 9% to $8.29.

Business segment results

  • RIS: Risk and Insurance Services (RIS) revenue was $4.2 billion, up 7% reported and 3% underlying, with an adjusted operating income of $1 billion.Third quarter revenue was $4.2 billion, up 7% from a year ago or 3% on an underlying basis.
  • Risk: Risk revenue was $3.7 billion, up 10% reported and 5% underlying, driven by solid sales in digital infrastructure and transactional risk.Despite the headwind from a soft pricing environment, sales and new business growth remains solid in areas such as digital infrastructure and transactional risk are creating demand.
  • Reinsurance: Reinsurance revenue was $374 million, down 6% on both a reported and underlying basis, impacted by property rate softness and difficult year-over-year comparisons.Q3 is a small quarter for reinsurance and revenue was impacted by continued softness in property reinsurance rates as well as a tough comparison
  • Consulting: Consulting revenue was $2.7 billion, up 9% reported and 8% underlying, with an adjusted operating income of $593 million.
  • People and Investments: People and Investments revenue was $1.7 billion, up 6% reported and 5% underlying.People and Investments revenue was $1.7 billion in the quarter, up 6% or 5% on an underlying basis.
  • People and Investments: Health and Benefits grew 5%, while Investments and Retirement grew 8%, with assets under management reaching $843 billion.Health and Benefits grew 5%, reflecting continued growth across our regions. Investments in retirement was up 8%, led by our investments business.
  • Workforce and Rewards: Workforce and Rewards revenue declined 1% due to a challenging environment in the Middle East.Workforce & Rewards was down 1% with growth in the U.S. and most of international offset by the impact of a challenging environment in the Middle East.
  • Management Consulting: Management Consulting revenue was $1 billion, up 14% on both a reported and underlying basis, benefiting from AI-related work and success fee timing.Management Consulting generated revenue of $1 billion in the third quarter, up 14% on both a reported and underlying basis.

Capital allocation

  • The company repurchased $500 million of stock in the third quarter, bringing year-to-date repurchases to $2 billion.we repurchased $500 million of stock in the quarter bringing us to $2 billion year-to-date.
  • Total uses of cash in the third quarter were $1.3 billion, including $476 million for dividends and $288 million for acquisitions.Uses of cash in the quarter totaled $1.3 billion and included $476 million for dividends, $288 million for acquisitions and $500 million for share repurchases.
  • Management expects to deploy approximately $5.5 billion of capital in 2026 across dividends, acquisitions, and share repurchases.We continue to expect to deploy approximately $5.5 billion of capital in 2026 across dividends, acquisitions and share repurchases.
  • Primary commercial insurance rates decreased 5% in the third quarter, following a 6% decline in the second quarter.According to the Marsh Global Insurance Market Index, primary commercial insurance rates decreased 5% in Q3.
  • Global property rates decreased 10%, while global financial and professional liability rates were down 3% and cyber rates decreased 4%.Global property rates decreased 10%. Global financial and Professional liability rates were down 3%, while cyber decreased 4%.
  • Global casualty rates increased 1%, with U.S. excess casualty up 13% due to inflationary pressure.Global casualty rates increased 1%, with U.S. excess casualty up 13%, reflecting inflationary pressure and loss costs
  • Reinsurance markets remain soft due to abundant capacity from traditional and alternative sources.In reinsurance, market conditions led by short tail lines remain soft, driven by abundant capacity from both traditional reinsurers and alternative capital.

Competitive landscape

  • Management believes scale is a critical advantage in the current environment of rapid change and technological transformation.I don't think it's debatable that scale matters in this changing time.
  • The company maintains a strong middle market presence, having completed over 130 deals in the last 15 years.We've done over 130 deals since we began that strategy about 15 years ago. It can't be replicated
  • The company believes it possesses the deepest talent in the marketplace, which remains a key competitive differentiator.Our people still matter. They are what deliver the insights to our clients, and we have the deepest, best talent in the marketplace.

Macroeconomic environment

  • The company describes the current global environment as one of structural change and uncertainty, citing wars, geoeconomics, and extreme weather.We're clearly in a period of change and uncertainty in the world. This change is structural, not cyclical, and it's happening at pace and all at once.
  • Geopolitical conflict continues to impact regions, including the Middle East, where the company maintains a significant colleague presence.there's a tremendous amount of disruption given the ongoing geopolitical conflict all throughout the region. We have over 2,500 colleagues in the Middle East.

Growth opportunities and strategies

  • The Thrive program savings target has been increased to $600 million, with savings reinvested into sales, technology, and brand initiatives.We're now seeing greater opportunities coming from Business & Client Services or BCS, and advances in technology. As a result, we are increasing our Thrive savings target to $600 million.
  • The company is actively deploying AI-enabled products, such as the Marsh Risk Companion, to improve client risk modeling and reduce administrative burdens.We've already deployed several AI-enabled products for clients that deliver valuable insights. These solutions tap into our large and expanding proprietary data sets
  • Digital infrastructure is a key growth driver, supported by the launch of the Stratus Exchange, which provides access to $10 billion in property coverage.Marsh recently launched the Stratus Exchange, which offers access up to $10 billion in property coverage for the ongoing operations of digital facilities.
  • Management Consulting is leveraging the Quotient AI platform to assist private equity firms and their portfolio companies with AI transformation.Oliver Wyman's fastest-growing practice, Quotient is working with private equity firms to serve their portfolio companies.

Financial guidance and outlook

  • The company expects underlying revenue growth in 2026 to be similar to the levels generated in 2025.we continue to expect underlying revenue growth in 2026 similar to last year.
  • Management anticipates another year of margin expansion and solid adjusted EPS growth.We also anticipate another year of margin expansion and solid adjusted EPS growth.
  • The adjusted effective tax rate is expected to be around 25% for 2026.Based on the current environment, we expect an adjusted effective tax rate of around 25% for 2026.
  • Interest expense is forecasted to be approximately $255 million in the fourth quarter.In our current forecast, we expect $255 million of interest expense in the fourth quarter.
  • The company recorded a $144 million charge in the third quarter related to the settlement of the Greensill litigation.Noteworthy items this quarter also included $144 million relating to the Greensill litigation. As disclosed in our 10-Q this morning, we have settled our involvement
  • Management does not expect any further charges related to the Greensill case.we have settled our involvement in this litigation and do not expect any additional charges relating to the case.

Q3 2026 results

MetricResultChange
Consolidated Revenue$6.9 billionup 8%
Adjusted EPS$2.03up 10%
Adjusted Operating Income$1.5 billionup 6%
Consulting Revenue$2.7 billionup 9%
RIS Revenue$4.2 billionup 7%
Fiduciary Interest Income$100 milliondown $9 million

How management sounded

Balanced (+35 on our -100 to +100 scale). Management expressed strong confidence in their market position and the benefits of their AI and efficiency initiatives, despite noting soft pricing in reinsurance and a complex global environment. Management sounded more upbeat than on 20% of the 302 calls we cover; most companies sound positive on their own calls, so the comparison says more than the label.

Read the analyst Q&A summary and guidance and outlook for this call.

What to watch before the next call

  • The impact of the January 1 reinsurance renewal cycle on pricing and market conditions.
  • The pace of AI adoption and its ability to deliver sustained efficiency gains and revenue growth.
  • The development of the M&A pipeline and the company's ability to execute on its capital deployment strategy.

Earlier calls

  • Q2 2026 (Jul 21, 2026), tone Balanced: Marsh & McLennan reported $7.4 billion in revenue, up 6%, with strong consulting performance offsetting reinsurance pricing headwinds. Management raised its 2026 capital deployment target to $5.5 billion and continues to expect margin expansion and solid earnings growth for the year.