UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended August 31, 2025

OR

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from                      to

Commission file number 1-05721

Jefferies Financial Group Inc.

(Exact name of registrant as specified in its charter)

New York			13-2615557
(State or other jurisdiction of<br><br>incorporation or organization)			(I.R.S. Employer<br><br>Identification No.)
520 Madison Avenue,	New York,	New York	10022
(Address of principal executive offices)			(Zip Code)

Registrant’s telephone number, including area code: (212) 284-2300

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Shares, par value $1 per share	JEF	New York Stock Exchange
4.850% Senior Notes Due 2027	JEF 27A	New York Stock Exchange
5.875% Senior Notes Due 2028	JEF 28	New York Stock Exchange
2.750% Senior Notes Due 2032	JEF 32A	New York Stock Exchange
6.200% Senior Notes Due 2034	JEF 34	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934

during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing

requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of

Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such

files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an

emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth

company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

The number of shares outstanding of each of the issuer’s classes of common stock at September 29, 2025 was 206,280,296.

Jefferies Financial Group, Inc.

Index to Quarterly Report on Form 10-Q

August 31, 2025

PART I. FINANCIAL INFORMATION
	Page
Item 1. Financial Statements	2
Consolidated Statements of Financial Condition (Unaudited) .........................................................................................................	2
Consolidated Statements of Earnings (Unaudited) ............................................................................................................................	3
Consolidated Statements of Comprehensive Income (Unaudited) ..................................................................................................	4
Consolidated Statements of Changes in Equity (Unaudited) ............................................................................................................	5
Consolidated Statements of Cash Flows (Unaudited) .......................................................................................................................	6
Notes to Consolidated Financial Statements (Unaudited) ................................................................................................................	8
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations ...............................................	46
Item 3. Quantitative and Qualitative Disclosures About Market Risk ....................................................................................................	69
Item 4. Controls and Procedures ..................................................................................................................................................................	69
PART II. OTHER INFORMATION
Item 1. Legal Proceedings .............................................................................................................................................................................	70
Item 1A. Risk Factors .....................................................................................................................................................................................	70
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds ..................................................................................................	70
Item 5. Other Information ..............................................................................................................................................................................	70
Item 6. Exhibits ................................................................................................................................................................................................	70
2	Jefferies Financial Group Inc.
---	---

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

Consolidated Statements of Financial Condition (Unaudited)
$ in thousands, except share and per share amounts	August 31,<br><br>2025	November 30,<br><br>2024
Assets
Cash and cash equivalents ...............................................................................................................................................................	$11,458,472	$12,153,414
Cash and securities segregated and on deposit for regulatory purposes or deposited with clearing and depository<br><br>organizations (includes $120,414 of securities at fair value at November 30, 2024) .........................................................	1,111,620	1,132,612
Financial instruments owned, at fair value (includes securities pledged of $18,135,984 and $18,441,751) .......................	26,117,064	24,138,274
Investments in and loans to related parties ...................................................................................................................................	1,458,250	1,385,658
Securities borrowed ...........................................................................................................................................................................	8,175,141	7,213,421
Securities purchased under agreements to resell ........................................................................................................................	7,917,487	6,179,653
Securities received as collateral, at fair value ................................................................................................................................	54,155	185,588
Receivables:
Brokers, dealers and clearing organizations ...............................................................................................................................	2,878,285	2,666,591
Customers ........................................................................................................................................................................................	3,028,443	2,494,717
Fees, interest and other ..................................................................................................................................................................	720,912	663,536
Premises and equipment ..................................................................................................................................................................	1,255,000	1,194,720
Goodwill ...............................................................................................................................................................................................	1,840,432	1,827,938
Assets held for sale ...........................................................................................................................................................................	—	51,885
Other assets (includes assets pledged of $545,419 and $429,347) ..........................................................................................	3,304,448	3,072,302
Total assets ........................................................................................................................................................................................	$69,319,709	$64,360,309
Liabilities and Equity
Short-term borrowings ......................................................................................................................................................................	$1,231,328	$443,160
Financial instruments sold, not yet purchased, at fair value .......................................................................................................	12,356,852	11,007,328
Securities loaned ................................................................................................................................................................................	2,498,013	2,540,861
Securities sold under agreements to repurchase .........................................................................................................................	12,090,567	12,337,935
Other secured financings (includes $611,903 and $24,848 at fair value) .................................................................................	2,683,269	2,183,000
Obligation to return securities received as collateral, at fair value .............................................................................................	54,155	185,588
Payables:
Brokers, dealers and clearing organizations ...............................................................................................................................	3,680,047	3,686,367
Customers ........................................................................................................................................................................................	4,448,494	4,073,975
Lease liabilities ...................................................................................................................................................................................	603,445	635,306
Accrued expenses and other liabilities ...........................................................................................................................................	3,158,589	3,510,831
Long-term debt (includes $3,564,534 and $2,351,346 at fair value) ..........................................................................................	16,013,634	13,530,565
Total liabilities ....................................................................................................................................................................................	58,818,393	54,134,916
Mezzanine Equity
Redeemable noncontrolling interests .............................................................................................................................................	406	406
Equity
Preferred shares, par value of $1 per share, authorized 70,000 shares; 55,125 shares issued and outstanding;<br><br>liquidation preference of $17,500 per share .............................................................................................................................	55	55
Common shares, par value $1 per share, authorized 565,000,000 shares; 206,280,296 and 205,504,272 shares issued<br><br>and outstanding, after deducting 114,837,774 and 115,613,798 shares held in treasury ..................................................	206,280	205,504
Non-voting common shares, par value $1 per share, authorized 35,000,000, shares; no shares issued and<br><br>outstanding ....................................................................................................................................................................................	—	—
Additional paid-in capital ..................................................................................................................................................................	2,145,409	2,104,199
Accumulated other comprehensive loss ........................................................................................................................................	(374,927)	(423,131)
Retained earnings ..............................................................................................................................................................................	8,461,907	8,270,145
Total Jefferies Financial Group Inc. shareholders' equity ..........................................................................................................	10,438,724	10,156,772
Noncontrolling interests ...................................................................................................................................................................	62,186	68,215
Total equity .........................................................................................................................................................................................	10,500,910	10,224,987
Total liabilities and equity ................................................................................................................................................................	$69,319,709	$64,360,309

See accompanying notes to consolidated financial statements.

August 2025 Form 10-Q	3

Consolidated Statements of Earnings (Unaudited)

	Three Months Ended August 31,		Nine Months Ended August 31,
$ in thousands, except per share amounts	2025	2024	2025	2024
Revenues
Investment banking ...............................................................................................	$1,088,197	$927,094	$2,606,976	$2,344,743
Principal transactions ............................................................................................	486,893	324,501	1,232,630	1,381,432
Commissions and other fees ...............................................................................	325,178	270,643	966,711	787,968
Asset management fees and revenues ..............................................................	13,079	11,986	118,563	74,126
Interest .....................................................................................................................	846,894	936,786	2,570,090	2,636,002
Other .........................................................................................................................	147,433	124,579	379,883	439,556
Total revenues ........................................................................................................	2,907,674	2,595,589	7,874,853	7,663,827
Interest expense .....................................................................................................	860,242	912,037	2,599,955	2,585,627
Net revenues ...........................................................................................................	2,047,432	1,683,552	5,274,898	5,078,200
Non-interest expenses
Compensation and benefits .................................................................................	1,083,510	889,098	2,779,476	2,677,962
Brokerage and clearing fees .................................................................................	121,164	101,119	360,345	321,325
Underwriting costs .................................................................................................	20,332	14,017	52,703	51,053
Technology and communications .......................................................................	157,171	136,953	442,844	409,703
Occupancy and equipment rental ........................................................................	32,908	30,078	93,818	87,558
Business development ..........................................................................................	78,999	68,152	231,360	194,433
Professional services ............................................................................................	73,329	64,630	223,563	217,967
Depreciation and amortization .............................................................................	53,230	45,977	136,471	139,125
Cost of sales ...........................................................................................................	34,430	37,400	118,959	109,533
Other expenses .......................................................................................................	60,544	43,441	217,578	168,858
Total non-interest expenses ................................................................................	1,715,617	1,430,865	4,657,117	4,377,517
Earnings from continuing operations before income taxes ............................	331,815	252,687	617,781	700,683
Income tax expense ...............................................................................................	89,311	78,011	147,033	207,077
Net earnings from continuing operations ...........................................................	242,504	174,676	470,748	493,606
Net earnings (losses) from discontinued operations (including gain on<br><br>disposal of $0, $2,839, $0, $2,839), net of income tax benefit of $0,<br><br>$9,145, $0, and $12,321 ........................................................................................	—	6,363	—	(1,488)
Net earnings ...........................................................................................................	242,504	181,039	470,748	492,118
Net losses attributable to noncontrolling interests ...........................................	(10,041)	(6,874)	(24,692)	(19,102)
Preferred stock dividends .....................................................................................	28,559	20,785	55,528	48,501
Net earnings attributable to common shareholders ........................................	$223,986	$167,128	$439,912	$462,719
Earnings per common share
Basic from continuing operations .......................................................................	$1.04	$0.75	$2.05	$2.12
Diluted from continuing operations .....................................................................	1.01	0.72	1.98	2.06
Basic .........................................................................................................................	1.04	0.78	2.05	2.12
Diluted ......................................................................................................................	1.01	0.75	1.98	2.06
Weighted-average common shares outstanding .............................................
Basic .........................................................................................................................	215,293	214,452	214,977	218,106
Diluted ......................................................................................................................	222,715	221,699	222,539	224,180

See accompanying notes to consolidated financial statements.

4	Jefferies Financial Group Inc.

Consolidated Statements of Comprehensive Income (Unaudited)

	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
$ in thousands	2025	2024	2025	2024
Net earnings ...................................................................................................................	$242,504	$181,039	$470,748	$492,118
Other comprehensive income (loss), net of tax:
Currency translation adjustments and other (1) ......................................................	8,551	22,560	39,998	18,443
Changes in fair value related to instrument-specific credit risk (2) ......................	(43,882)	17,783	7,945	5,081
Unrealized gains on available-for-sale-securities ...................................................	99	426	261	2,056
Total other comprehensive income (loss), net of tax (3) .......................................	(35,232)	40,769	48,204	25,580
Comprehensive income ................................................................................................	207,272	221,808	518,952	517,698
Net losses attributable to noncontrolling interests ..................................................	(10,041)	(6,874)	(24,692)	(19,102)
Preferred stock dividends ............................................................................................	28,559	20,785	55,528	48,501
Comprehensive income attributable to common shareholders ............................	$188,754	$207,897	$488,116	$488,299

(1)Includes income tax expense of $4.5 million and $14.6 million for the three and nine months ended August 31, 2025, respectively, and income tax

expense of $7.9 million and $7.2 million for the three and nine months ended August 31, 2024.

(2)Includes income tax benefit (expense) of $15.1 million and $(3.4) million for the three and nine months ended August 31, 2025, respectively, and

income tax expense of $6.1 million and $1.0 million for the three and nine months ended August 31, 2024, respectively.

(3)Includes unrealized gains (losses) related to currency translation adjustments attributable to noncontrolling interests of $0.9 million and

$(1.0) million for the three and nine months ended August 31, 2024, respectively.

See accompanying notes to consolidated financial statements.

August 2025 Form 10-Q	5

Consolidated Statements of Changes in Equity (Unaudited)

		Nine Months Ended August 31,
in thousands, except par value and per share amounts	2024	2025	2024
Preferred shares 1 par value
Balance, beginning of period .............................................................................	$42	$55	$42
Conversion of common shares to preferred shares ...................................	13	—	13
Balance, end of period .......................................................................................	$55	$55	$55
Common shares 1 par value
Balance, beginning of period .............................................................................	$212,053	$205,504	$210,627
Purchase of common shares for treasury ...................................................	(7)	(735)	(1,089)
Conversion of common shares to preferred shares ...................................	(6,562)	—	(6,562)
Other ..................................................................................................................	11	1,511	2,519
Balance, end of period .......................................................................................	$205,495	$206,280	$205,495
Additional paid-in capital
Balance, beginning of period .............................................................................	$2,051,149	$2,104,199	$2,044,859
Share-based compensation expense ............................................................	13,377	67,810	47,949
Purchase of common shares for treasury ...................................................	(325)	(57,751)	(43,222)
Dividend equivalents .......................................................................................	4,756	23,089	14,436
Conversion of common shares to preferred shares ...................................	16,393	—	16,393
Change in equity interest related to consolidated subsidiaries ................	—	(5,833)	—
Other ..................................................................................................................	877	13,895	5,812
Balance, end of period .......................................................................................	$2,086,227	$2,145,409	$2,086,227
Accumulated other comprehensive loss, net of tax
Balance, beginning of period .............................................................................	$(410,734)	$(423,131)	$(395,545)
Other comprehensive income (loss), net of taxes ......................................	40,769	48,204	25,580
Balance, end of period .......................................................................................	$(369,965)	$(374,927)	$(369,965)
Retained earnings
Balance, beginning of period .............................................................................	$8,022,546	$8,270,145	$7,849,844
Net earnings attributable to Jefferies Financial Group Inc. .......................	187,913	495,440	511,222
Dividends - common shares (0.40, 0.35, 1.20, 0.95 per share) ........	(76,678)	(270,603)	(213,581)
Dividends - preferred shares ..........................................................................	(9,647)	(33,075)	(22,247)
Cumulative effect of change in accounting principle for current expected credit losses, net of tax .............................................................	—	—	(644)
Other ..................................................................................................................	—	—	(460)
Balance, end of period .......................................................................................	$8,124,134	$8,461,907	$8,124,134
Total Jefferies Financial Group Inc. shareholders' equity ...........................	$10,045,946	$10,438,724	$10,045,946
Noncontrolling interests
Balance, beginning of period .............................................................................	$77,130	$68,215	$92,308
Net losses attributable to noncontrolling interests ....................................	(6,874)	(24,692)	(19,102)
Contributions ....................................................................................................	105	18,909	9,426
Distributions .....................................................................................................	(1,876)	(14,787)	(12,565)
Change in equity interest related to consolidated subsidiaries ................	—	14,548	—
Other ..................................................................................................................	930	(7)	(652)
Balance, end of period .......................................................................................	$69,415	$62,186	$69,415
Total equity ..........................................................................................................	$10,115,361	$10,500,910	$10,115,361

All values are in US Dollars.

See accompanying notes to consolidated financial statements.

6	Jefferies Financial Group Inc.

Consolidated Statements of Cash Flows (Unaudited)

	Nine Months Ended August 31,
$ in thousands	2025	2024
Cash flows from operating activities:
Net earnings ......................................................................................................................................................................................	$470,748	$492,118
Adjustments to reconcile net earnings to net cash used in operating activities:
Depreciation and amortization ....................................................................................................................................................	144,434	141,584
Share-based compensation .........................................................................................................................................................	67,810	47,949
Net bad debt expense ...................................................................................................................................................................	16,931	48,305
Income on investments in and loans to related parties ...........................................................................................................	(54,270)	(62,187)
Distributions received on investments in related parties ........................................................................................................	71,368	36,048
Gain on sale of subsidiaries and investments in related parties ............................................................................................	—	(58,452)
Loss on assets held for sale ........................................................................................................................................................	12,566	—
Other adjustments .........................................................................................................................................................................	434,110	208,693
Net change in assets and liabilities:
Receivables:
Brokers, dealers and clearing organizations ..........................................................................................................................	(193,514)	(188,454)
Customers ...................................................................................................................................................................................	(533,734)	(356,045)
Fees, interest and other .............................................................................................................................................................	(60,040)	(59,530)
Securities borrowed ......................................................................................................................................................................	(945,232)	158,071
Financial instruments owned .......................................................................................................................................................	(1,712,385)	(2,145,820)
Securities purchased under agreements to resell ....................................................................................................................	(1,664,568)	(975,592)
Other assets ...................................................................................................................................................................................	(266,563)	(421,913)
Payables:
Brokers, dealers and clearing organizations ..........................................................................................................................	(26,372)	663,467
Customers ...................................................................................................................................................................................	374,518	(62,089)
Securities loaned ...........................................................................................................................................................................	(62,979)	691,548
Financial instruments sold, not yet purchased .........................................................................................................................	1,260,915	985,256
Securities sold under agreements to repurchase .....................................................................................................................	(312,049)	(1,387,996)
Lease liabilities ..............................................................................................................................................................................	(48,280)	(56,408)
Accrued expenses and other liabilities ......................................................................................................................................	(432,723)	451,355
Net cash used in operating activities from continuing operations .........................................................................................	(3,459,309)	(1,850,092)
Net cash used in operating activities from discontinued operations .....................................................................................	—	(68,789)
Cash flows from investing activities:
Contributions to investments in and loans to related parties .................................................................................................	(466,338)	(108,484)
Capital distributions from investments and repayments of loans from related parties .....................................................	379,193	1,406
Originations and purchases of automobile loans, notes and other receivables ..................................................................	—	(89,540)
Principal collections of automobile loans, notes and other receivables ...............................................................................	—	83,268
Net payments on premises and equipment ..............................................................................................................................	(151,425)	(180,654)
Proceeds from assets held for sale ............................................................................................................................................	26,843	—
Proceeds from sales of subsidiary and investment in related parties, net of cash of operations sold ...........................	—	610,843
Net cash (used in) provided by investing activities from continuing operations .................................................................	(211,727)	316,839
August 2025 Form 10-Q	7
---	---

Consolidated Statements of Cash Flows (Unaudited)

	Nine Months Ended August 31,
$ in thousands	2025	2024
Cash flows from financing activities:
Proceeds from short-term borrowings .......................................................................................................................................	$7,170,583	$3,826,758
Payments on short-term borrowings ..........................................................................................................................................	(6,363,688)	(3,058,475)
Proceeds from issuance of long-term debt, net of issuance costs .......................................................................................	3,852,721	4,646,993
Repayment of long-term debt ......................................................................................................................................................	(1,758,422)	(1,763,572)
Proceeds from conversion of common to preferred shares ...................................................................................................	—	9,844
Purchase of common shares for treasury .................................................................................................................................	(58,486)	(44,311)
Dividends paid to common and preferred shareholders .........................................................................................................	(280,589)	(221,392)
Net proceeds from other secured financings ...........................................................................................................................	497,768	434,285
Net change in bank overdrafts ....................................................................................................................................................	(22,050)	(33,795)
Proceeds from contributions of noncontrolling interests .......................................................................................................	18,909	9,426
Payments on distributions to noncontrolling interests ............................................................................................................	(8,084)	(12,565)
Other ................................................................................................................................................................................................	9,573	7,871
Net cash provided by financing activities from continuing operations ..................................................................................	3,058,235	3,801,067
Net cash used in financing activities from discontinued operations ......................................................................................	—	(170,631)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash ...............................................................	17,281	18,901
Change in cash, cash equivalents, and restricted cash reclassified from (to) assets held for sale ....................................	—	(13,224)
Net (decrease) increase in cash, cash equivalents, and restricted cash .................................................................................	(595,520)	2,047,295
Cash, cash equivalents, and restricted cash at beginning of period ........................................................................................	13,165,612	9,830,758
Cash, cash equivalents, and restricted cash at end of period ..................................................................................................	$12,570,092	$11,864,829
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest ............................................................................................................................................................................................	$2,588,490	$2,535,591
Income taxes, net (1) ....................................................................................................................................................................	235,549	167,796

(1)Includes the purchase of investment tax credits in the aggregate of $149.7 million.

Noncash investing activities:

During the nine months ended August 31, 2025, we donated land with a fair market value of $5.7 million.

During the nine months ended August 31, 2025 and 2024, we had stock distributions of $0.4 million and $0.6 million, respectively, from

our equity method investments.

Noncash financing activities:

During the nine months ended August 31, 2025, we had declared distributions to noncontrolling interests of $6.7 million.

Cash, cash equivalents and restricted cash by category in our Consolidated Statements of Financial Condition:

	August 31,	November 30,
$ in thousands	2025	2024
Cash and cash equivalents ...........................................................................................................................................	$11,458,472	$12,153,414
Cash on deposit for regulatory purposes with clearing and depository organizations .......................................	1,111,620	1,012,198
Total cash, cash equivalents and restricted cash ....................................................................................................	$12,570,092	$13,165,612

See accompanying notes to consolidated financial statements.

8	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Index

	Page
Note 1. Organization and Basis of Presentation ......................................................................................................................................................................	9
Note 2. Summary of Significant Accounting Policies .............................................................................................................................................................	9
Note 3. Accounting Developments ............................................................................................................................................................................................	10
Note 4. Business Acquisitions ....................................................................................................................................................................................................	10
Note 5. Assets Held for Sale and Discontinued Operations ...................................................................................................................................................	11
Note 6. Fair Value Disclosures ....................................................................................................................................................................................................	12
Note 7. Derivative Financial Instruments ..................................................................................................................................................................................	22
Note 8. Collateralized Transactions ...........................................................................................................................................................................................	25
Note 9. Securitization Activities .................................................................................................................................................................................................	27
Note 10. Variable Interest Entities ..............................................................................................................................................................................................	27
Note 11. Investments ...................................................................................................................................................................................................................	30
Note 12. Credit Losses on Financial Assets Measured at Amortized Cost .........................................................................................................................	33
Note 13. Goodwill and Intangible Assets ..................................................................................................................................................................................	33
Note 14. Revenues from Contracts with Customers ...............................................................................................................................................................	35
Note 15. Compensation Plans ....................................................................................................................................................................................................	36
Note 16. Borrowings .....................................................................................................................................................................................................................	37
Note 17. Total Equity ....................................................................................................................................................................................................................	39
Note 18. Income Taxes ................................................................................................................................................................................................................	41
Note 19. Commitments, Contingencies and Guarantees .......................................................................................................................................................	41
Note 20. Regulatory Requirements ............................................................................................................................................................................................	43
Note 21. Segment Reporting .......................................................................................................................................................................................................	44
Note 22. Related Party Transactions .........................................................................................................................................................................................	45
August 2025 Form 10-Q	9
---	---

Notes to Consolidated Financial Statements

(Unaudited)

Note 1. Organization and Basis of Presentation

Organization

Jefferies Financial Group Inc. is a U.S.-headquartered global full

service, integrated investment banking and capital markets firm.

The accompanying Consolidated Financial Statements represent

the accounts of Jefferies Financial Group Inc. and subsidiaries

(together, the “Company,” “we” or “us”). We, collectively with our

consolidated subsidiaries and through our affiliates, deliver a

broad range of financial services across investment banking,

capital markets and asset management.

We operate in two reportable business segments: (1) Investment

Banking and Capital Markets and (2) Asset Management. The

Investment Banking and Capital Markets reportable business

segment includes our capital markets activities and our

investment banking business, which provides underwriting and

financial advisory services to our clients. We operate in the

Americas; Europe and the Middle East; and Asia-Pacific.

Investment Banking and Capital Markets also includes our

corporate lending joint venture (“Jefferies Finance LLC” or

“Jefferies Finance”), our commercial real estate joint venture

(“Berkadia Commercial Holding LLC” or “Berkadia”) and

historically our automobile lending and servicing activities (sold

in April 2024). The Asset Management reportable business

segment provides alternative investment management services

to investors in the U.S. and overseas and generates investment

income from capital invested in and managed by us or our

affiliated asset managers, and includes certain remaining

businesses and assets of our legacy merchant banking portfolio.

During the fourth quarter of 2023, we acquired Stratos Group

International (“Stratos”) (formerly FXCM Group, LLC, or “FXCM”)

and OpNet S.p.A. (“OpNet,” formerly known as “Linkem”),

investments in our legacy merchant banking portfolio which

became consolidated subsidiaries. In April 2024, we finalized the

sale of Foursight Capital LLC (“Foursight”). In February 2024,

OpNet agreed to sell substantially all of its wholesale operating

assets to Wind Tre S.p.A., a subsidiary of CK Hutchison Group

Telecom Holdings Ltd. The sale closed in August 2024. Refer to

Note 4, Business Acquisitions and Note 5, Assets Held for Sale

and Discontinued Operations for further information.

Basis of Presentation

The accompanying consolidated financial statements have been

prepared in accordance with U.S. generally accepted accounting

principles (“U.S. GAAP”) and should be read in conjunction with

our consolidated financial statements and notes thereto included

in our Annual Report on Form 10-K for the year ended

November 30, 2024. Certain footnote disclosures included in our

Annual Report on Form 10-K for the year ended November 30,

2024 have been condensed or omitted from the consolidated

financial statements as they are not required for interim reporting

under U.S. GAAP. The consolidated financial statements reflect

all adjustments of a normal, recurring nature that are, in the

opinion of management, necessary for the fair presentation of

the results for the interim period. The results presented in our

consolidated financial statements for interim periods are not

necessarily indicative of the results for the entire year.

We have made a number of estimates and assumptions relating

to the reporting of assets and liabilities, the disclosure of

contingent assets and liabilities and the reported amounts of

revenues and expenses during the reporting period to prepare

these consolidated financial statements in conformity with U.S.

GAAP. The most important of these estimates and assumptions

relate to fair value measurements, compensation and benefits,

goodwill and intangible assets and the accounting for income

taxes. Although these and other estimates and assumptions are

based on the best available information, actual results could be

materially different from these estimates.

Consolidation

Our policy is to consolidate all entities that we control by

ownership of a majority of the outstanding voting stock. In

addition, we consolidate entities that meet the definition of a

variable interest entity (“VIE”) for which we are the primary

beneficiary. The primary beneficiary is the party who has the

power to direct the activities of a VIE that most significantly

impact the entity’s economic performance and who has an

obligation to absorb losses of the entity or a right to receive

benefits from the entity that could potentially be significant to the

entity. For consolidated entities that are less than wholly-owned,

the third-party’s holding of equity interest is presented as

Noncontrolling interests in our Consolidated Statements of

Financial Condition and Consolidated Statements of Changes in

Equity. The portion of net earnings attributable to the

noncontrolling interests is presented as Net earnings (losses)

attributable to noncontrolling interests in our Consolidated

Statements of Earnings.

In situations in which we have significant influence, but not

control, of an entity that does not qualify as a VIE, we apply either

the equity method of accounting or fair value accounting

pursuant to the fair value option election under U.S. GAAP, with

our portion of net earnings or gains and losses recorded in Other

revenues or Principal transactions revenues, respectively. We

also have formed nonconsolidated investment vehicles with

third-party investors that are typically organized as partnerships

or limited liability companies and are carried at fair value. We act

as general partner or managing member for these investment

vehicles and have generally provided the third-party investors

with termination or “kick-out” rights.

Intercompany accounts and transactions are eliminated in

consolidation.

Note 2. Summary of Significant Accounting Policies

For a detailed discussion about the Company’s significant

accounting policies, refer to Note 2, Summary of Significant

Accounting Policies in our consolidated financial statements

included in Part II, Item 8 of our Annual Report on Form 10-K for

the year ended November 30, 2024.

During the three and nine months ended August 31, 2025, there

were no significant changes made to the Company’s significant

accounting policies.

10	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Note 3. Accounting Developments

Accounting Standards to be Adopted in Future Periods

Segment Reporting. In November 2023, the Financial Accounting

Standards Board (“FASB”) issued ASU No. 2023-07 (“ASU

2023-07”), Improvements to Reportable Segment Disclosures.

The guidance primarily will require enhanced disclosures about

significant segment expenses. The amendments in ASU 2023-07

are effective for fiscal years beginning after December 15, 2023,

and interim periods within fiscal years beginning after December

15, 2024, with early adoption permitted, and are to be applied on

a retrospective basis. We are evaluating the impact of the

standard on our segment reporting disclosures and will

implement these disclosures commencing with our fiscal year

ending November 30, 2025.

Income Taxes. In December 2023, the FASB issued ASU No.

2023-09 (“ASU 2023-09”), Improvements to Income Tax

Disclosures. The guidance is intended to improve income tax

disclosure requirements by requiring (i) consistent categories

and greater disaggregation of information in the rate

reconciliation and (ii) the disaggregation of income taxes paid by

jurisdiction. The guidance makes several other changes to the

income tax disclosure requirements. The amendments in ASU

2023-09 are effective for fiscal years beginning after December

15, 2024, with early adoption permitted, and are required to be

applied prospectively with the option of retrospective application.

We are evaluating the impact of the standard on our income tax

disclosures.

Expenses. In November 2024, the FASB issued ASU No. 2024-03

(“ASU 2024-03”), Disaggregation of Income Statement Expenses.

The guidance primarily will require enhanced disclosures about

certain types of expenses. The amendments in ASU 2024-03 are

effective for fiscal years beginning after December 15, 2026, and

interim periods within fiscal years beginning after December 15,

2027 and may be applied either on a prospective or retrospective

basis. We are evaluating the impact of the standard on our

disclosures.

Credit Losses. In July 2025, the FASB issued ASU No. 2025-05

(“ASU 2025-05”), Financial Instruments–Credit Losses. The

guidance provides an optional practical expedient when applying

the guidance related to the estimation of expected credit losses

for current accounts receivable and current contract assets

resulting from transactions arising from contracts with

customers. The amendments in ASU 2025-05 are effective for

fiscal years beginning after December 15, 2025, and interim

reporting periods, with early adoption permitted. We are

evaluating the impact of the standard on our financial

statements.

Internal-Use Software. In September 2025, the FASB issued ASU

No. 2025-06 (“ASU 2025-06”), Intangibles–Goodwill and Other–

Internal-Use Software. The guidance modernizes and clarifies the

threshold for when an entity is required to start capitalizing

software costs and is based on when (i) management has

authorized and committed to funding the software project and (ii)

it is probable that the project will be completed and the software

will be used to perform the function intended. The amendments

in ASU 2025-06 are effective for fiscal years beginning after

December 15, 2027, and interim reporting periods, with early

adoption permitted. We are evaluating the impact of the standard

on our disclosures.

Derivatives and Hedging and Revenue from Contracts with

Customers. In September 2025, the FASB issued ASU No.

2025-07 (“ASU 2025-07”), Derivatives and Hedging (Topic 815)

and Revenue from Contracts with Customers (Topic 606). The

guidance refines the scope of Topic 815 to clarify which

contracts are subject to derivative accounting. The guidance also

provides clarification under Topic 606 for share-based payments

from a customer in a revenue contract. The amendments in ASU

2025-07 are effective for fiscal years beginning after December

15, 2026, and interim reporting periods, with early adoption

permitted. We are evaluating the impact of the standard on our

disclosures.

Note 4. Business Acquisitions

OpNet

We historically owned 47.4% of the common shares and 50.0% of

the voting rights of OpNet, a fixed wireless broadband service

provider in Italy, and various classes of convertible preferred

stock issued by OpNet (the “preferred shares”). On November 30,

2023, we provided notice of our intent to convert certain classes

of our preferred shares into common shares and, as a result, we

obtained control of OpNet. Upon conversion on May 7, 2024, our

ownership increased to 57.5% of the common shares and our

voting rights increased to 72.5% of the aggregate voting rights of

OpNet.

Upon obtaining control of OpNet on November 30, 2023, the

assets and liabilities of OpNet have been included in our

consolidated financial statements under the acquisition method

of accounting. The initial consolidation of OpNet was accounted

for under the acquisition method of accounting and we

remeasured our previously existing interests at fair value and

recognized a gain of $115.8 million, representing the excess of

the fair value of our previously existing interests over the carrying

value of our investment of $201.6 million.

The fair value of the previously existing interests was measured

based on an estimate of what could be recognized in a sale

transaction for wholesale net operating assets operating assets

of OpNet, which have been classified as held for sale. The

remaining identifiable assets and assumed liabilities of OpNet

represented the assets and liabilities of Tessellis S.p.A.

(“Tessellis”), a telecommunications company publicly listed on

the Italian stock exchange. An enterprise value for Tessellis was

estimated based on its market capitalization at November 30,

2023, which was then allocated to the identifiable assets,

including intangible assets, liabilities, and noncontrolling

interests of Tessellis using an income approach, which

calculates the present value of the estimated economic benefit

of future cash flows, in order to determine the fair value of the

identified customer relationships and Tessellis trade name.

Property and equipment and developed technology assets were

valued using a replacement cost methodology. Critical estimates

included future expected cash flows, including forecasted

revenues and expenses, and applicable discount rates. Discount

rates used to compute the present value of expected net cash

flows were based upon estimated weighted average cost of

capital. The initial allocation of the purchase price resulted in the

recognition of goodwill relating to Tessellis of $127.1 million. No

consideration was transferred in connection with the

consolidation.

August 2025 Form 10-Q	11

Notes to Consolidated Financial Statements

(Unaudited)

The initial estimated purchase price allocation as of November

30, 2023 for Tessellis was revised during the first quarter of 2024

as new information was received and analyzed resulting in an

increase in intangible assets of $39.3 million, a decrease in

property and equipment of $12.3 million, and a decrease in

goodwill of $27.0 million.

In February 2024, OpNet agreed to sell substantially all of its

wholesale operating assets to Wind Tre S.p.A., a subsidiary of CK

Hutchison Group Telecom Holdings Ltd. The sale closed in

August 2024 and we received net cash proceeds of

$322.8 million and recognized a pre-tax gain on sale of

$3.5 million. The sale of OpNet’s operating assets did not include

our interest in Tessellis.

During 2024, Tessellis executed various acquisitions and, as a

result, recognized assets and liabilities of $27.9 million and

$20.2 million, respectively, on the acquisition dates. Total assets

primarily relate to goodwill, property and equipment, intangible

assets, and short-term trade receivables. Total liabilities primarily

relate to financial debt assumed and trade payables. The primary

acquisition executed during 2024 was the acquisition of a 97.2%

ownership interest in Go Internet S.p.A. (“Go Internet”) for a total

consideration of €4.2 million. During the second quarter of 2025,

purchase price allocation adjustments were finalized.

Note 5. Assets Held for Sale and Discontinued Operations

Foursight

During the second quarter of 2024, we closed the sale of

Foursight and recognized a gain on sale of $24.2 million, which is

included within Other revenues.

OpNet

In August 2024, we substantially sold all of OpNet’s wholesale

operating assets and recognized a pre-tax gain on sale of

$3.5 million. For the year ended November 30, 2024, the activities

of OpNet’s wholesale operations have been classified as

discontinued operations and OpNet’s results are presented in Net

losses from discontinued operations, net of income tax benefit.

Airplanes

During 2024, we classified certain airplanes related to a sale

leaseback transaction executed with a client by our subsidiary,

Aircadia Leasing II LLC as held for sale. Effective with the

designation of the airplanes as held for sale, we suspended

recording depreciation on these assets. The airplanes are

included within Assets held for sale on our Consolidated

Statements of Financial Condition and had a carrying amount of

$51.9 million at November 30, 2024. During the second quarter of

2025, we agreed to sell the airplanes and we recognized a loss of

$12.8 million during the three months ended May 31, 2025. The

sale closed in the third quarter of 2025.

12	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Note 6. Fair Value Disclosures

	August 31, 2025 (1)
$ in thousands	Level 1	Level 2	Level 3	Counterparty<br><br>and Cash<br><br>Collateral<br><br>Netting (2)	Total
Assets:
Financial instruments owned:
Corporate equity securities ..................................................................................	$5,737,635	$205,768	$272,309	$—	$6,215,712
Corporate debt securities .....................................................................................	—	5,087,057	34,380	—	5,121,437
Collateralized debt obligations and collateralized loan obligations ...............	—	612,592	52,309	—	664,901
U.S. government and federal agency securities ................................................	3,354,090	87,161	—	—	3,441,251
Municipal securities ..............................................................................................	—	518,701	—	—	518,701
Sovereign obligations ............................................................................................	1,043,729	696,809	—	—	1,740,538
Residential mortgage-backed securities ............................................................	—	1,442,778	7,978	—	1,450,756
Commercial mortgage-backed securities ..........................................................	—	83,421	506	—	83,927
Other asset-backed securities .............................................................................	—	688,579	126,175	—	814,754
Loans and other receivables ................................................................................	—	2,531,881	139,922	—	2,671,803
Derivatives ..............................................................................................................	620	4,516,818	7,787	(2,792,740)	1,732,485
Investments at fair value ......................................................................................	—	7	161,500	—	161,507
Total financial instruments owned, excluding Investments at fair value<br><br>based on NAV ....................................................................................................	$10,136,074	$16,471,572	$802,866	$(2,792,740)	$24,617,772
Securities received as collateral ..........................................................................	$54,155	$—	$—	$—	$54,155
Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities ..................................................................................	$4,432,279	$43,021	$796	$—	$4,476,096
Corporate debt securities .....................................................................................	—	3,274,453	488	—	3,274,941
U.S. government and federal agency securities ................................................	1,788,871	30	—	—	1,788,901
Sovereign obligations ............................................................................................	835,790	653,079	—	—	1,488,869
Commercial mortgage-backed securities ..........................................................	—	1	1,188	—	1,189
Loans .......................................................................................................................	—	71,614	1,966	—	73,580
Derivatives ..............................................................................................................	189	4,359,613	44,683	(3,151,209)	1,253,276
Total financial instruments sold, not yet purchased .......................................	$7,057,129	$8,401,811	$49,121	$(3,151,209)	$12,356,852
Other secured financings ......................................................................................	$—	$595,789	$16,114	$—	$611,903
Obligation to return securities received as collateral .......................................	54,155	—	—	—	54,155
Long-term debt .......................................................................................................	—	2,493,370	1,071,164	—	3,564,534

(1)Excludes investments at fair value based on net asset value (“NAV”) of $1.50 billion at August 31, 2025 by level within the fair value hierarchy.

(2)Represents counterparty and cash collateral netting across the levels of the fair value hierarchy for positions with the same counterparty.

August 2025 Form 10-Q	13

Notes to Consolidated Financial Statements

(Unaudited)

	November 30, 2024 (1)
$ in thousands	Level 1	Level 2	Level 3	Counterparty<br><br>and Cash<br><br>Collateral<br><br>Netting (2)	Total
Assets:
Financial instruments owned:
Corporate equity securities ..................................................................................	$5,238,058	$302,051	$239,364	$—	$5,779,473
Corporate debt securities .....................................................................................	—	5,310,815	24,931	—	5,335,746
Collateralized debt obligations and collateralized loan obligations ...............	—	1,029,662	63,976	—	1,093,638
U.S. government and federal agency securities ................................................	3,583,139	160,227	—	—	3,743,366
Municipal securities ..............................................................................................	—	320,507	—	—	320,507
Sovereign obligations ............................................................................................	749,912	630,681	172	—	1,380,765
Residential mortgage-backed securities ............................................................	—	2,348,862	7,714	—	2,356,576
Commercial mortgage-backed securities ..........................................................	—	146,752	477	—	147,229
Other asset-backed securities .............................................................................	—	110,687	103,214	—	213,901
Loans and other receivables ................................................................................	—	1,706,152	152,586	—	1,858,738
Derivatives ..............................................................................................................	146	3,181,454	3,926	(2,667,751)	517,775
Investments at fair value ......................................................................................	—	6	137,865	—	137,871
Total financial instruments owned, excluding Investments at fair value<br><br>based on NAV ....................................................................................................	$9,571,255	$15,247,856	$734,225	$(2,667,751)	$22,885,585
Securities segregated and on deposit for regulatory purposes or<br><br>deposited with clearing and depository organizations ................................	$120,414	$—	$—	$—	$120,414
Securities received as collateral ..........................................................................	185,588	—	—	—	185,588
Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities ..................................................................................	$3,013,877	$73,240	$208	$—	$3,087,325
Corporate debt securities .....................................................................................	—	3,105,010	165	—	3,105,175
U.S. government and federal agency securities ................................................	2,904,379	26	—	—	2,904,405
Sovereign obligations ............................................................................................	667,647	422,124	—	—	1,089,771
Commercial mortgage-backed securities .........................................................	—	—	1,153	—	1,153
Loans .......................................................................................................................	—	92,321	16,864	—	109,185
Derivatives ..............................................................................................................	13	3,477,802	26,212	(2,793,713)	710,314
Total financial instruments sold, not yet purchased .......................................	$6,585,916	$7,170,523	$44,602	$(2,793,713)	$11,007,328
Other secured financings ......................................................................................	$—	$9,964	$14,884	$—	$24,848
Obligation to return securities received as collateral ......................................	185,588	—	—	—	185,588
Long-term debt .......................................................................................................	—	1,529,443	821,903	—	2,351,346

(1)Excludes investments at fair value based on NAV of $1.25 billion at November 30, 2024 by level within the fair value hierarchy.

(2)Represents counterparty and cash collateral netting across the levels of the fair value hierarchy for positions with the same counterparty.

14	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

There have been no significant changes in valuation techniques

and inputs used in measuring our financial assets and liabilities

that are accounted for at fair value on a recurring basis. Refer to

our consolidated financial statements included in Part II, Item 8

of our Annual Report on Form 10-K for the year ended

November 30, 2024.

Investments at Fair Value

Investments at fair value includes investments in hedge funds,

private equity funds, credit funds, real estate funds and other

funds, which are measured at the NAV of the funds, provided by

the fund managers and are excluded from the fair value

hierarchy. Investments at fair value also include direct equity

investments in private companies, which are measured at fair

value using valuation techniques involving quoted prices of or

market data for comparable companies, similar company ratios

and multiples (e.g., price/EBITDA, price/book value), discounted

cash flow analyses and transaction prices observed for

subsequent financing or capital issuance by the company. Direct

equity investments in private companies are categorized within

Level 2 or Level 3 of the fair value hierarchy.

Information about our investments in entities that have the

characteristics of an investment company:

	August 31, 2025
$ in thousands	Fair Value<br><br>(1)	Unfunded Commitments	Redemption<br><br>Notice Period
Hedge<br><br>Funds (2) ..............	$704,965	—	45 - 90 days<br><br>45 - 60 days
Private Equity<br><br>Funds (3) ..............	71,189	27,069	N/R
Credit<br><br>Funds (4) ..............	511,884	23,856	90 days<br><br>30 days<br><br>N/R
Real Estate and<br><br>Other Funds (5) ....	211,254	151,128	90 days<br><br>N/R
Total ......................	$1,499,292	202,053

All values are in US Dollars.

	November 30, 2024
$ in thousands	Fair Value<br><br>(1)	Unfunded Commitments	Redemption<br><br>Notice Period
Hedge<br><br>Funds (2) ............	$660,720	—	45 - 90 days<br><br>45 - 60 days
Private Equity<br><br>Funds (3) ............	60,215	30,530	N/R
Credit Funds (4)	430,429	30,554	90 days<br><br>30 days<br><br>N/R
Real Estate and<br><br>Other Funds (5) .	101,325	232,696	N/R
Total ...................	$1,252,689	293,780

All values are in US Dollars.

N/R - Not redeemable

(1)Where fair value is calculated based on NAV, fair value has been derived from

each of the funds’ capital statements.

(2)Includes investments in hedge funds that invest, long and short, primarily in

both public and private equity securities in domestic and international

markets, commodities and multi-asset securities.

(3)Includes investments in equity funds that invest in the equity of various U.S.

and foreign private companies in a broad range of industries. These

investments cannot be redeemed; instead, distributions are received through

the liquidation of the underlying assets of the funds which are primarily

expected to be liquidated in approximately one to nine years.

(4)Primarily includes investments in funds that invest in:

•distressed and special situations long/short credit strategies across

sectors and asset types;

•short-term trade receivables and payables that are expected to generally

be outstanding between 90 to 120 days; and

•distressed and event-driven opportunities across structured credit,

opportunistic credit, and private credit.

(5)Primarily includes investments in corporate real estate strategies focused on

buying or building real estate businesses.

August 2025 Form 10-Q	15

Notes to Consolidated Financial Statements

(Unaudited)

Level 3 Rollforwards

	Three Months Ended August 31, 2025
$ in thousands	Balance at<br><br>May 31,<br><br>2025	Total<br><br>gains/<br><br>losses<br><br>(realized<br><br>and<br><br>unrealized)<br><br>(1)	Purchases	Sales	Settlements	Issuances	Net<br><br>transfers<br><br>into/<br><br>(out of)<br><br>Level 3	Balance at<br><br>August 31,<br><br>2025	For instruments still held at<br><br>August 31, 2025, changes in<br><br>unrealized gains (losses)<br><br>included in:
									Earnings (1)	Other<br><br>comprehensive<br><br>income<br><br>(loss) (1)
Level 3 assets:
Financial instruments owned:
Corporate equity securities ....................	$231,160	$21,824	$20,785	$(1,487)	$(788)	$—	$815	$272,309	$21,916	$—
Corporate debt securities ......................	44,682	872	1,221	(788)	—	—	(11,607)	34,380	860	—
CDOs and CLOs .......................................	70,948	(3,654)	20,718	(17,731)	(3,463)	—	(14,509)	52,309	(4,188)	—
RMBS ........................................................	7,947	46	—	—	(15)	—	—	7,978	50	—
CMBS ........................................................	505	1	—	—	—	—	—	506	1	—
Other ABS .................................................	153,681	(2,589)	23,586	(1,579)	(2,888)	—	(44,036)	126,175	(732)	—
Loans and other receivables .................	92,168	3,213	65,988	(44,566)	(16,129)	—	39,248	139,922	4,862	—
Investments at fair value ........................	153,379	10,308	1,000	(2,446)	(741)	—	—	161,500	9,502	—
Level 3 liabilities:
Financial instruments sold, not yet<br><br>purchased:
Corporate equity securities ....................	$161	$(312)	$(1)	$426	$—	$—	$522	$796	$309	$—
Corporate debt securities ......................	644	126	(119)	—	(270)	—	107	488	(117)	—
CMBS ........................................................	1,153	—	—	35	—	—	—	1,188	—	—
Loans ........................................................	313	1,691	—	—	—	—	(38)	1,966	(1,101)	—
Net derivatives (2) ...................................	33,288	9,477	(533)	719	(748)	—	(5,307)	36,896	(9,313)	—
Other secured financings .......................	18,876	143	—	—	(2,905)	—	—	16,114	(255)	—
Long-term debt ........................................	991,156	54,332	—	—	(2,050)	29,155	(1,429)	1,071,164	(7,342)	(44,940)			Nine Months Ended August 31, 2025
---	---	---	---	---	---	---	---	---	---	---
$ in thousands	Balance at<br><br>November 30,<br><br>2024	Total<br><br>gains/<br><br>losses<br><br>(realized<br><br>and<br><br>unrealized)<br><br>(1)	Purchases	Sales	Settlements	Issuances	Net<br><br>transfers<br><br>into/<br><br>(out of)<br><br>Level 3	Balance at<br><br>August 31,<br><br>2025	For instruments still held at<br><br>August 31, 2025, changes in<br><br>unrealized gains (losses)<br><br>included in:
									Earnings (1)	Other<br><br>comprehensive<br><br>income<br><br>(loss) (1)
Assets:
Financial instruments owned:
Corporate equity securities ................	$239,364	$31,303	$28,748	$(8,940)	$494	$—	$(18,660)	$272,309	$29,840	$—
Corporate debt securities ...................	24,931	2,385	12,455	(1,168)	(2,197)	—	(2,026)	34,380	1,472	—
CDOs and CLOs ...................................	63,976	(14,474)	69,479	(39,811)	(10,013)	—	(16,848)	52,309	(15,237)	—
Sovereign obligations .........................	172	2	—	(174)	—	—	—	—	—	—
RMBS .....................................................	7,714	315	—	—	(51)	—	—	7,978	331	—
CMBS ....................................................	477	29	—	—	—	—	—	506	29	—
Other ABS .............................................	103,214	(2,792)	60,151	(31,920)	(8,089)	—	5,611	126,175	(1,256)	—
Loans and other receivables ..............	152,586	(8,455)	213,419	(196,921)	(38,621)	—	17,914	139,922	10,777	—
Investments at fair value ....................	137,865	16,742	22,549	(2,446)	(3,210)	—	(10,000)	161,500	13,540	—
Liabilities:
Financial instruments sold, not yet<br><br>purchased:
Corporate equity securities ................	$208	$(864)	$(72,161)	$73,148	$—	$—	$465	$796	$999	$—
Corporate debt securities ...................	165	60	(280)	351	192	—	—	488	(90)	—
CMBS ....................................................	1,153	—	—	105	—	—	(70)	1,188	—	—
Loans ....................................................	16,864	(14,097)	(875)	74	—	—	—	1,966	(1,790)	—
Net derivatives (2) ...............................	22,286	(11,263)	(533)	23,307	(1,166)	—	4,265	36,896	2,447	—
Other secured financings ...................	14,884	346	—	—	(7,647)	8,531	—	16,114	(1,366)	—
Long-term debt ....................................	821,903	32,255	—	—	(4,849)	247,279	(25,424)	1,071,164	(28,330)	(3,925)

(1)Realized and unrealized gains/losses are primarily reported in Principal transactions revenues. Changes in instrument-specific credit risk related to structured notes

within Long-term debt are presented net of tax in our Consolidated Statements of Comprehensive Income.

(2)Net derivatives represent Financial instruments owned—Derivatives and Financial instruments sold, not yet purchased—Derivatives.

16	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Analysis of Level 3 Assets and Liabilities for the Three Months

Ended August 31, 2025

Transfers of assets of $64.4 million from Level 2 to Level 3 of the

fair value hierarchy are primarily attributed to:

•Loan and other receivables of $43.5 million, CDOs and CLOs of

$12.6 million and Other ABS of $6.7 million due to reduced

pricing transparency.

Transfers of assets of $94.5 million from Level 3 to Level 2 of the

fair value hierarchy are primarily attributed to:

•Other ABS of $50.7 million, CDOs and CLOs of $27.1 million,

Corporate debt securities of $12.3 million and Loans and other

receivables of $4.3 million due to greater pricing transparency

supporting classification into Level 2.

Transfers of liabilities of $16.0 million from Level 2 to Level 3 of

the fair value hierarchy are primarily attributed to:

•Structured notes within Long-term debt of $13.1 million,

partially offset by net derivatives transfers into Level 3 of $2.4

million due to reduced market and pricing transparency.

Transfers of liabilities of $22.2 million from Level 3 to Level 2 of

the fair value hierarchy are primarily attributed to:

•Structured notes within Long-term debt of $14.5 million and

Net derivatives of $7.7 million due to greater pricing and

market transparency.

Net gains on Level 3 assets were $30.0 million and net losses on

Level 3 liabilities were $65.5 million for the three months ended

August 31, 2025. Net gains on Level 3 assets were primarily due to

increased market values across Corporate equity securities,

Investments at fair value, Loans and other receivables and Other

ABS, partially offset by decreased market values of CDOs and

CLOs. Net losses on Level 3 liabilities were primarily due to

increased valuations of structured notes within Long-term debt,

certain derivatives and Loans.

Analysis of Level 3 Assets and Liabilities for the Nine Months

Ended August 31, 2025

Transfers of assets of $99.5 million from Level 2 to Level 3 of the

fair value hierarchy are primarily attributed to:

•Loan and other receivables of $38.2 million, Corporate equity

securities of $32.2 million, CDOs and CLOs of $18.6 million and

Other ABS of $10.0 million due to reduced pricing

transparency.

Transfers of assets of $123.5 million from Level 3 to Level 2 of

the fair value hierarchy are primarily attributed to:

•Corporate equity securities of $50.8 million, CDOs and CLOs of

$35.4 million, Loans and other receivables of $20.3 million,

Investments at fair value of $10.0 million, Other ABS of

$4.4 million and Corporate debt securities of $2.5 million due

to greater pricing transparency supporting classification into

Level 2.

Transfers of liabilities of $21.3 million from Level 2 to Level 3 of

the fair value hierarchy are primarily attributed to:

•Net derivatives of $13.4 million and structured notes within

Long-term debt of $7.4 million due to reduced market and

pricing transparency.

Transfers of liabilities of $42.1 million from Level 3 to Level 2 of

the fair value hierarchy are primarily attributed to:

•Structured notes within Long-term debt of $32.8 million and

certain Derivatives of $9.2 million due to greater pricing and

market transparency.

Net gains on Level 3 assets were $25.1 million and net losses on

Level 3 liabilities were $6.4 million for the nine months ended

August 31, 2025. Net gains on Level 3 assets were primarily due

to increased market values across Corporate equity securities

and Investments at fair value, partially offset by decreased

valuations of CDOs and CLOs and Loans and other receivables.

Net losses on Level 3 liabilities were primarily due to increased

valuations of structured notes within Long-term debt, partially

offset by decreased market values of certain Derivatives and

Loans.

August 2025 Form 10-Q	17

Notes to Consolidated Financial Statements

(Unaudited)

	Three Months Ended August 31, 2024
$ in thousands	Balance at<br><br>May 31,<br><br>2024	Total<br><br>gains/<br><br>losses<br><br>(realized<br><br>and<br><br>unrealized)<br><br>(1)	Purchases	Sales	Settlements	Issuances	Net<br><br>transfers<br><br>into/<br><br>(out of)<br><br>Level 3	Balance at<br><br>August 31,<br><br>2024	For instruments still held at<br><br>August 31, 2024, changes in<br><br>unrealized gains (losses)<br><br>included in:
									Earnings (1)	Other<br><br>comprehensive<br><br>income<br><br>(loss) (1)
Assets:
Financial instruments owned:
Corporate equity securities .................	$178,755	$9,887	$12,874	$(1,035)	$(198)	$—	$360	$200,643	$10,184	$—
Corporate debt securities ...................	38,717	93	—	(1,753)	—	—	(5,879)	31,178	1,181	—
CDOs and CLOs ....................................	68,626	1,477	17,704	(1,147)	(1,323)	—	(3,256)	82,081	649	—
Sovereign obligations ..........................	—	—	—	—	—	—	106	106	—	—
RMBS .....................................................	644	24	—	—	(12)	—	(32)	624	34	—
CMBS .....................................................	477	15	—	—	—	—	—	492	—	—
Other ABS ..............................................	168,736	(966)	29,502	(27,528)	(3,608)	—	(20,733)	145,403	(1,988)	—
Loans and other receivables ..............	92,546	(18,742)	10,138	(4,489)	(2,258)	—	9,929	87,124	(5,863)	—
Investments at fair value .....................	138,057	952	371	—	—	—	—	139,380	952	—
Liabilities:
Financial instruments sold, not yet<br><br>purchased:
Corporate equity securities .................	$708	$4	$—	$2,264	$—	$—	$(6)	$2,970	$(4)	$—
Corporate debt securities ...................	506	—	(246)	—	—	—	—	260	—	—
CMBS .....................................................	1,049	—	—	—	70	—	—	1,119	—	—
Loans .....................................................	1,584	(1,000)	—	964	12	—	—	1,560	1	—
Net derivatives (2) ................................	34,877	(7,588)	—	—	734	—	477	28,500	4,363	—
Other secured financings ....................	3,965	—	—	—	—	—	—	3,965	—	—
Long-term debt .....................................	784,212	25,080	—	—	—	542	(20,688)	789,146	(37,145)	12,065			Nine Months Ended August 31, 2024
---	---	---	---	---	---	---	---	---	---	---
$ in thousands	Balance at<br><br>November 30,<br><br>2023	Total<br><br>gains/<br><br>losses<br><br>(realized<br><br>and<br><br>unrealized)<br><br>(1)	Purchases	Sales	Settlements	Issuances	Net<br><br>transfers<br><br>into/<br><br>(out of)<br><br>Level 3	Balance at<br><br>August 31,<br><br>2024	For instruments still held at<br><br>August 31, 2024, changes in<br><br>unrealized gains (losses)<br><br>included in:
									Earnings (1)	Other<br><br>comprehensive<br><br>income<br><br>(loss) (1)
Assets:
Financial instruments owned:
Corporate equity securities ................	$181,294	$(3,969)	$28,576	$(2,480)	$—	$—	$(2,778)	$200,643	$(3,179)	$—
Corporate debt securities ...................	26,112	3,060	14,894	(6,735)	(200)	—	(5,953)	31,178	7,309	—
CDOs and CLOs ...................................	64,862	8,771	41,690	(22,797)	(5,214)	—	(5,231)	82,081	4,351	—
Sovereign obligations .........................	—	(16)	11,147	(11,025)	—	—	—	106	3	—
RMBS .....................................................	20,871	(185)	—	(5,374)	(63)	—	(14,625)	624	33	—
CMBS ....................................................	508	(16)	—	—	—	—	—	492	(64)	—
Other ABS .............................................	117,661	(7,724)	94,754	(68,622)	(19,929)	—	29,263	145,403	(5,778)	—
Loans and other receivables ..............	130,101	(43,105)	20,220	(4,856)	(19,523)	—	4,287	87,124	(17,949)	—
Investments at fair value ....................	130,835	(10,626)	19,725	—	(547)	—	(7)	139,380	(10,626)	—
Liabilities:
Financial instruments sold, not yet<br><br>purchased:
Corporate equity securities	$676	$5	$—	$2,289	$—	$—	$—	$2,970	$(5)	$—
Corporate debt securities ...................	124	(23)	—	—	—	—	159	260	23	—
CMBS ....................................................	840	—	(245)	—	525	—	(1)	1,119	(2)	—
Loans ....................................................	1,521	1,879	(180)	1,367	152	—	(3,179)	1,560	(26)	—
Net derivatives (2) ...............................	50,955	(17,212)	(3,236)	2,471	(9,504)	—	5,026	28,500	5,659	—
Other secured financings ...................	3,898	4,482	—	—	(4,415)	—	—	3,965	(4,482)	—
Long-term debt ....................................	744,597	34,157	—	—	(2,109)	28,614	(16,113)	789,146	(41,836)	7,679

(1)Realized and unrealized gains/losses are primarily reported in Principal transactions revenues. Changes in instrument-specific credit risk related to structured notes

within Long-term debt are presented net of tax in our Consolidated Statements of Comprehensive Income.

(2)Net derivatives represent Financial instruments owned—Derivatives and Financial instruments sold, not yet purchased—Derivatives.

18	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Analysis of Level 3 Assets and Liabilities for the Three Months

Ended August 31, 2024

Transfers of assets of $31.3 million from Level 2 to Level 3 of the

fair value hierarchy are primarily attributed to:

•Loan and other receivables of $15.9 million, CDOs and CLOs of

$10.1 million and Other ABS of $3.3 million due to reduced

pricing transparency.

Transfers of assets of $50.8 million from Level 3 to Level 2 of the

fair value hierarchy are primarily attributed to:

•Oher ABS of $24.0 million, CDOs and CLOs of $13.4 million,

Corporate debt securities of $7.1 and Loans and other

receivables of $5.9 million due to greater pricing transparency

supporting classification into Level 2.

Transfers of liabilities of $18.8 million from Level 2 to Level 3 of

the fair value hierarchy are primarily attributed to:

•Structured notes within Long-term debt of $9.6 million and Net

derivatives of $9.3 million due to reduced market and pricing

transparency.

Transfers of liabilities of $39.0 million from Level 3 to Level 2 of

the fair value hierarchy are primarily attributed to:

•Structured notes within Long-term debt of $30.2 million and

Net derivatives of $8.8 million due to greater pricing and

market transparency.

Net losses on Level 3 assets were $7.3 million and net losses on

Level 3 liabilities were $16.5 million for the three months ended

August 31, 2024. Net losses on Level 3 assets were primarily due

to decreased market values across Loans and other receivables,

partially offset by increased market values of Corporate equity

securities and CDOs and CLOs. Net losses on Level 3 liabilities

were primarily due to increased valuations of structured notes

within Long-term debt, partially offset by decreased valuations of

certain derivatives.

Analysis of Level 3 Assets and Liabilities for the Nine Months

Ended August 31, 2024

Transfers of assets of $61.0 million from Level 2 to Level 3 of the

fair value hierarchy are primarily attributed to:

•Other ABS of $47.6 million and Loan and other receivables of

$11.3 million due to reduced pricing transparency.

Transfers of assets of $56.0 million from Level 3 to Level 2 of the

fair value hierarchy are primarily attributed to:

•Other ABS of $18.3 million, RMBS of $14.6 million, Corporate

debt securities of $7.5 million, Loans and other receivables of

$7.0 million, CDOs and CLOs of $5.2 million and Corporate

equity securities of $3.3 million due to greater pricing

transparency supporting classification into Level 2.

Transfers of liabilities of $39.4 million from Level 2 to Level 3 of

the fair value hierarchy are primarily attributed to:

•Net derivatives of $23.2 million and structured notes within

Long-term debt of $18.8 million due to reduced market and

pricing transparency.

Transfers of liabilities of $53.1 million from Level 3 to Level 2 of

the fair value hierarchy are primarily attributed to:

•Structured notes within Long-term debt of $34.9 million and

Net derivatives of $18.2 million due to greater pricing and

market transparency.

Net losses on Level 3 assets were $53.8 million and net losses

on Level 3 liabilities were $23.3 million for the nine months ended

August 31, 2024. Net losses on Level 3 assets were primarily due

to decreased market values across Loans and other receivables,

Investments at fair value, Other ABS and Corporate equity

securities, partially offset by increased valuations of CDOs and

CLOs and Corporate debt securities. Net losses on Level 3

liabilities were primarily due to increased valuations of structured

notes within Long-term debt and Other secured financings,

partially offset by decreased valuations of certain derivatives.

Significant Unobservable Inputs used in Level 3 Fair Value

Measurements

The tables below present information on the valuation

techniques, significant unobservable inputs and their ranges for

our financial assets and liabilities, subject to threshold levels

related to the market value of the positions held, measured at fair

value on a recurring basis with a significant Level 3 balance. The

range of unobservable inputs could differ significantly across

different firms given the range of products across different firms

in the financial services sector. The inputs are not representative

of the inputs that could have been used in the valuation of any

one financial instrument (i.e., the input used for valuing one

financial instrument within a particular class of financial

instruments may not be appropriate for valuing other financial

instruments within that given class). Additionally, the ranges of

inputs presented below should not be construed to represent

uncertainty regarding the fair values of our financial instruments;

rather, the range of inputs is reflective of the differences in the

underlying characteristics of the financial instruments in each

category.

For certain categories, we have provided a weighted average of

the inputs allocated based on the fair values of the financial

instruments comprising the category. We do not believe that the

range or weighted average of the inputs is indicative of the

reasonableness of uncertainty of our Level 3 fair values. The

range and weighted average are driven by the individual financial

instruments within each category and their relative distribution in

the population. The disclosed inputs when compared to the

inputs as disclosed in other periods should not be expected to

necessarily be indicative of changes in our estimates of

unobservable inputs for a particular financial instrument as the

population of financial instruments comprising the category will

vary from period to period based on purchases and sales of

financial instruments during the period as well as transfers into

and out of Level 3 each period.

August 2025 Form 10-Q	19

Notes to Consolidated Financial Statements

(Unaudited)

August 31, 2025
Financial Instruments Owned	Fair Value(in thousands)	Significant Unobservable Input(s)	Input / Range		Weighted<br><br>Average
Corporate equity securities .....................	272,309
Non-exchange-traded securities		Price	0	$486	$71
		Volatility	30%	34%	33%
Corporate debt securities ........................	34,380	Price	49	$119	$71
		Discount rate/yield	17%	20%	18%
CDOs and CLOs ..........................................	34,377	Constant prepayment rate	20%		—
		Constant default rate	2%		—
		Loss severity	30%		—
		Discount rate/yield	13%	17%	16%
		Price	98	$100	$99
RMBS ...........................................................	7,978	Constant prepayment rate	12%		—
		Constant default rate	0.3%		—
		Loss severity	20%		—
		Discount rate/yield	14%		—
Other ABS ...................................................	122,633	Discount rate/yield	14%	28%	16%
		Cumulative loss rate	13%	15%	14%
		Duration (years)	0.6	1.2	1.1
		Price	117	$135	$132
		Estimated recovery percentage	79%		—
Loans and other receivables ...................	139,922	Price	6	$117	$101
		Estimated recovery percentage	8%	256%	50%
Derivatives ..................................................	4,323
Embedded options		Basis points upfront	0.0	0.4	0.4
Equity options		Volatility	34%		—
Investments at fair value ..........................	155,554
Private equity securities		Price	0	$10,956	$1,641
		Discount rate/yield	16%	28%	28%
		Estimated revenue	29,763,576		—
Financial Instruments Sold, Not Yet Purchased:
Loans ..........................................................	1,966	Price	100		—
Derivatives ..................................................	44,683
Equity options		Volatility	28%	72%	61%
Embedded options		Basis points upfront	0.0	22.6	14.5
Other secured financings .........................	16,114	Estimated recovery percentage	76%	100%	96%
		Price	114	$118	$116
Long-term debt ..........................................	1,071,164
Structured notes		Price	70	$122	$102

All values are in US Dollars.

20	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

November 30, 2024
Financial Instruments Owned	Fair Value(in thousands)	Significant Unobservable Input(s)	Input / Range		Weighted<br><br>Average
Corporate equity securities .....................	239,364
Non-exchange-traded securities		Price	0	$486	$68
Corporate debt securities ........................	24,931	Price	28	$105	$74
CDOs and CLOs ..........................................	53,388	Constant prepayment rate	20%		—
		Constant default rate	2%		—
		Loss severity	30%		—
		Discount rate/yield	14%	32%	26%
		Price	70	$106	$94
RMBS ...........................................................	7,714	Constant prepayment rate	20%		—
		Loss severity	10%		—
		Discount rate/yield	12%		—
Other ABS ...................................................	98,172	Discount rate/yield	19%	30%	25%
		Cumulative loss rate	17%	34%	24%
		Duration (years)	0.9	1.0	0.9
		Price	106	$127	$121
		Estimated recovery percentage	92%		—
Loans and other receivables ...................	152,586	Price	17	$106	$75
		Estimated recovery percentage	3%	252%	50%
Derivatives ..................................................	1,396
Embedded options		Basis points upfront	0.3		—
Investments at fair value ..........................	132,769
Private equity securities		Price	1	$8,506	$501
		Discount rate/yield	28%		—
		Estimated revenue	29,908,372		—
Financial Instruments Sold, Not Yet Purchased:
Loans ..........................................................	16,864	Price	17	$100	$75
		Estimated recovery percentage	0%	205%	50%
Derivatives ..................................................	25,045
Equity options		Volatility	28%	102%	49%
Options		Basis points upfront	8.0	22.3	14.9
Other secured financings .........................	14,884	Estimated recovery percentage	60%	100%	93%
		Price	117		—
Long-term debt ..........................................	821,903
Structured notes		Price	61	$122	$96

All values are in US Dollars.

The fair values of certain Level 3 assets and liabilities that were

determined based on third-party pricing information, unadjusted

past transaction prices or a percentage of the reported enterprise

fair value are excluded from the above tables. At August 31, 2025

and November 30, 2024, asset exclusions consisted of $31.4

million and $23.9 million, respectively, primarily composed of

CDOs and CLOs, Investments at fair value, certain derivatives,

Other ABS and CMBS. At August 31, 2025 and November 30,

2024, liability exclusions consisted of $2.5 million and $2.7

million, respectively, primarily composed of CMBS, certain

derivatives, corporate equity securities and corporate debt

securities.

Uncertainty of Fair Value Measurement from Use of Significant

Unobservable Inputs

For recurring fair value measurements categorized within Level 3

of the fair value hierarchy, the uncertainty of the fair value

measurement due to the use of significant unobservable inputs

and interrelationships between those unobservable inputs (if any)

are described below:

•Non-exchange-traded securities, corporate debt securities,

CDOs and CLOs, loans and other receivables, other ABS, private

equity securities, certain derivatives, other secured financings

and structured notes using a market approach valuation

technique. A significant increase (decrease) in the price of the

private equity securities, nonexchange-traded securities,

corporate debt securities, CDOs and CLOs, other ABS, loans

and other receivables, other secured financings and structured

notes would result in a significantly higher (lower) fair value

August 2025 Form 10-Q	21

Notes to Consolidated Financial Statements

(Unaudited)

measurement. A significant increase (decrease) in the revenue

or revenue multiple related to private equity securities would

result in a significantly higher (lower) fair value measurement.

A significant increase (decrease) in the discount rate/security

yield related to private equity securities would result in a

significantly lower (higher) fair value measurement. Depending

on whether we are a receiver or (payer) of basis points upfront,

a significant increase in basis points would result in a

significant increase (decrease) in the fair value measurement

of options.

•Loans and other receivables, other ABS and other secured

financings using a scenario analysis valuation technique. A

significant increase (decrease) in the possible recovery rates

underlying the financial instrument would result in a

significantly higher (lower) fair value measurement for the

financial instrument.

•CDOs and CLOs, corporate debt securities, RMBS and other

ABS using a discounted cash flows valuation technique. A

significant increase (decrease) in isolation in the constant

default rate, loss severity or cumulative loss rate would result

in a significantly lower (higher) fair value measurement. The

impact of changes in the constant prepayment rate and

duration would have differing impacts depending on the capital

structure and type of security. A significant increase

(decrease) in the discount rate/security yield would result in a

significantly lower (higher) fair value measurement.

•Corporate equity securities and derivative equity options using

volatility benchmarking. A significant increase (decrease) in

volatility would result in a significantly higher (lower) fair value

measurement.

Fair Value Option Election

For a description of our financial assets and liabilities for which

we have elected the fair value option, refer to our consolidated

financial statements included in Part II, Item 8 of our Annual

Report on Form 10-K for the year ended November 30, 2024.

Fair value option gains (losses):

	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
$ in thousands	2025	2024	2025	2024
Financial instruments owned:
Loans and other receivables (1) .	$(62,934)	$(690)	$(35,557)	$(39,664)
Other secured financings:
Other changes in fair value (1) ...	$(2,908)	$—	$(4,566)	$(4,482)
Long-term debt:
Changes in instrument-specific<br><br>credit risk (2) ............................	$(59,163)	$23,779	$7,356	$6,009
Other changes in fair value (1) ...	(58,429)	(84,266)	(27,159)	(111,716)

(1)Other changes in fair value are included in Principal transactions revenues.

(2)Changes in fair value of structured notes related to instrument-specific credit

risk are presented net of tax in our Consolidated Statements of

Comprehensive Income.

Fair value option amounts by which contractual principal is

greater than (less than) fair value:

$ in thousands	August 31,<br><br>2025	November 30,<br><br>2024
Financial instruments owned:
Loans and other receivables (1) ...............................	$1,766,934	$1,603,512
Loans and other receivables on nonaccrual<br><br>status and/or 90 days or greater past<br><br>due (1) (2) ...............................................................	181,250	132,838
Long-term debt ...........................................................	170,430	131,107
Other secured financings .........................................	(4,107)	459

(1)Interest income is recognized separately from other changes in fair value and

is included in Interest revenues.

(2)Amounts include loans and other receivables 90 days or greater past due by

which contractual principal exceeds fair value of $64.0 million and $48.8

million at August 31, 2025 and November 30, 2024, respectively.

The aggregate fair value of loans and other receivables on

nonaccrual status and/or 90 days or greater past due was $129.1

million and $126.9 million at August 31, 2025 and November 30,

2024, respectively, which includes loans and other receivables 90

days or greater past due of $94.3 million and $120.0 million at

August 31, 2025 and November 30, 2024, respectively.

Assets Measured at Fair Value on a Non-recurring Basis

Our shares in Monashee, an equity method investment, were

measured at fair value on a nonrecurring basis during the nine

months ended August 31, 2024 and are not included in the tables

above. During the nine months ended August 31, 2024, we

converted our shares in Monashee to a newly created class of

nonmarketable preferred shares and remeasured our equity

method investment to a fair value of $21.9 million in connection

with the nonmonetary exchange and the preferred shares are

subsequently accounted for at cost pursuant to the

measurement alternative.

Financial Instruments Not Measured at Fair Value

Certain of our financial instruments are not carried at fair value

but are recorded at amounts that approximate fair value due to

their liquid or short-term nature and generally negligible credit

risk. These financial assets include Cash and cash equivalents

and Cash and securities segregated and on deposit for regulatory

purposes or deposited with clearing and depository organizations

and would generally be presented within Level 1 of the fair value

hierarchy.

We have equity securities without readily determinable fair

values, which we account for at cost, minus impairment, which

are presented within Other assets and were $21.9 million at both

August 31, 2025 and November 30, 2024. There were no

impairments and downward adjustments on these investments

during the three and nine months ended August 31, 2025 and

2024.

22	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Note 7. Derivative Financial Instruments

Our derivative activities are recorded at fair value in Financial

instruments owned and Financial instruments sold, not yet

purchased, net of cash paid or received under credit support

agreements and on a net counterparty basis when a legally

enforceable right to offset exists under a master netting

agreement. We enter into derivative transactions to satisfy the

needs of our clients and to manage our own exposure to market

and credit risks. In addition, we apply hedge accounting to: (1)

interest rate swaps that have been designated as fair value

hedges of the changes in fair value due to the benchmark interest

rate for certain fixed rate senior long-term debt, and (2) forward

foreign exchange contracts designated as hedges to offset the

change in the value of certain net investments in foreign

operations.

Derivatives are subject to various risks similar to other financial

instruments, including market, credit and operational risk. The

risks of derivatives should not be viewed in isolation, but rather

should be considered on an aggregate basis along with our other

trading-related activities. We manage the risks associated with

derivatives on an aggregate basis along with the risks associated

with proprietary trading as part of our firm wide risk management

policies.

In connection with our derivative activities, we may enter into

International Swaps and Derivatives Association, Inc. master

netting agreements or similar agreements with counterparties.

	August 31, 2025 (1)
	Assets	Liabilities
$ in thousands	Fair Value	Fair Value
Derivatives designated as<br><br>accounting hedges:
Interest rate contracts:
Cleared OTC ........................................	57	1,131
Foreign exchange contracts:
Bilateral OTC .......................................	1,846	61,729
Total derivatives designated as<br><br>accounting hedges ............................	1,903	62,860
Derivatives not designated as<br><br>accounting hedges:
Interest rate contracts:
Exchange-traded ................................	562	113
Cleared OTC ........................................	508,861	523,997
Bilateral OTC .......................................	316,345	630,797
Foreign exchange contracts:
Exchange-traded ................................	215	76
Bilateral OTC .......................................	106,449	84,671
Equity contracts:
Exchange-traded ................................	2,602,854	2,037,083
Bilateral OTC .......................................	918,891	1,008,462
Commodity contracts:
Exchange-traded ................................	273	50
Bilateral OTC .......................................	4,606	3,127
Credit contracts:
Cleared OTC ........................................	1,721	10,212
Bilateral OTC .......................................	62,545	43,037
Total derivatives not designated<br><br>as accounting hedges .......................	4,523,322	4,341,625
Total gross derivative assets/<br><br>liabilities:
Exchange-traded ................................	2,603,904	2,037,322
Cleared OTC ........................................	510,639	535,340
Bilateral OTC .......................................	1,410,682	1,831,823
Amounts offset in our<br><br>Consolidated Statements of<br><br>Financial Condition (3):
Exchange-traded ................................	(1,445,932)	(1,445,932)
Cleared OTC ........................................	(509,365)	(517,824)
Bilateral OTC .......................................	(837,443)	(1,187,453)
Net amounts per Consolidated<br><br>Statements of Financial<br><br>Condition (4) .................................	1,732,485	1,253,276

All values are in US Dollars.

(1)Exchange-traded derivatives include derivatives executed on an organized

exchange. Cleared OTC derivatives include derivatives executed bilaterally and

subsequently novated to and cleared through central clearing counterparties.

Bilateral OTC derivatives include derivatives executed and settled bilaterally

without the use of an organized exchange or central clearing counterparty.

(2)The number of exchange-traded contracts may include open futures

contracts. The unsettled fair value of these futures contracts is included in

Receivables from/Payables to brokers, dealers and clearing organizations.

(3)Amounts netted include both netting by counterparty and for cash collateral

paid or received.

(4)We have not received or pledged additional collateral under master netting

agreements and/or other credit support agreements that is eligible to be

offset beyond what has been offset in our Consolidated Statements of

Financial Condition.

August 2025 Form 10-Q	23

Notes to Consolidated Financial Statements

(Unaudited)

	November 30, 2024 (1)
	Assets	Liabilities
$ in thousands	Fair Value	Fair Value
Derivatives designated as<br><br>accounting hedges:
Interest rate contracts:
Cleared OTC .........................................	3,396	—
Foreign exchange contracts:
Bilateral OTC ........................................	41,903	—
Total derivatives designated as<br><br>accounting hedges .............................	45,299	—
Derivatives not designated as<br><br>accounting hedges:
Interest rate contracts:
Exchange-traded .................................	273	13
Cleared OTC .........................................	1,030,842	1,030,671
Bilateral OTC ........................................	365,678	717,255
Foreign exchange contracts:
Bilateral OTC ........................................	132,240	138,608
Equity contracts:
Exchange-traded .................................	682,327	521,889
Bilateral OTC ........................................	855,169	1,024,129
Commodity contracts:
Exchange-traded .................................	22	17
Bilateral OTC .......................................	4,570	1,381
Credit contracts:
Cleared OTC .........................................	31,488	38,711
Bilateral OTC ........................................	37,618	31,353
Total derivatives not designated as<br><br>accounting hedges .............................	3,140,227	3,504,027
Total gross derivative assets/<br><br>liabilities:
Exchange-traded .................................	682,622	521,919
Cleared OTC .........................................	1,065,726	1,069,382
Bilateral OTC ........................................	1,437,178	1,912,726
Amounts offset in our<br><br>Consolidated Statements of<br><br>Financial Condition (3):
Exchange-traded .................................	(476,364)	(476,364)
Cleared OTC .........................................	(1,058,995)	(1,066,232)
Bilateral OTC ........................................	(1,132,392)	(1,251,117)
Net amounts per Consolidated<br><br>Statements of Financial<br><br>Condition (4) ..................................	517,775	710,314

All values are in US Dollars.

(1)Exchange-traded derivatives include derivatives executed on an organized

exchange. Cleared OTC derivatives include derivatives executed bilaterally and

subsequently novated to and cleared through central clearing counterparties.

Bilateral OTC derivatives include derivatives executed and settled bilaterally

without the use of an organized exchange or central clearing counterparty.

(2)The number of exchange-traded contracts may include open futures

contracts. The unsettled fair value of these futures contracts is included in

Receivables from/Payables to brokers, dealers and clearing organizations.

(3)Amounts netted include both netting by counterparty and for cash collateral

paid or received.

(4)We have not received or pledged additional collateral under master netting

agreements and/or other credit support agreements that is eligible to be

offset beyond what has been offset in our Consolidated Statements of

Financial Condition.

Gains (losses) recognized in Interest expense related to fair value

hedges:

$ in thousands	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
Gains (Losses)	2025	2024	2025	2024
Interest rate swaps (1) ..................	$8,902	$43,765	$2,859	$12,954
Long-term debt ...............................	(21,388)	(61,068)	(40,047)	(62,053)
Total .................................................	$(12,486)	$(17,303)	$(37,188)	$(49,099)

(1)Includes net settlements of $12.3 million and $36.4 million for the three and

nine months ended August 31, 2025, respectively, and $16.2 million and $48.2

million for the three and nine months ended August 31, 2024, respectively.

Gains (losses) on our net investment hedges recognized in

Currency translation and other adjustments, a component of

Other comprehensive income (loss):

$ in thousands	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
Gains (Losses)	2025	2024	2025	2024
Foreign exchange contracts .........	$(3,238)	$(38,878)	$(77,370)	$(47,686)
Total .................................................	$(3,238)	$(38,878)	$(77,370)	$(47,686)

Unrealized and realized gains (losses) on derivative contracts

recognized primarily in Principal transactions revenues, which are

utilized in connection with our client activities and our economic

risk management activities:

$ in thousands	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
Gains (Losses)	2025	2024	2025	2024
Interest rate contracts ...................	$242	$72,271	$(30,970)	$107,103
Foreign exchange contracts .........	(15,402)	15,760	1,309	48,289
Equity contracts ..............................	444,317	72,741	1,762,483	(186,617)
Commodity contracts ....................	3,476	6,270	16,932	24,702
Credit contracts ..............................	(9,105)	(222)	(7,401)	(13,592)
Total .................................................	$423,528	$166,820	$1,742,353	$(20,115)

The net gains (losses) on derivative contracts in the table above

are one of a number of activities comprising our business

activities and are before consideration of economic hedging

transactions, which generally offset the net gains (losses)

included above. We substantially mitigate our exposure to market

risk on our cash instruments through derivative contracts, which

generally provide offsetting revenues, and we manage the risk

associated with these contracts in the context of our overall risk

management framework.

24	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

OTC Derivatives

Remaining contract maturities at August 31, 2025:

	OTC Derivative Assets (1) (2) (3)
$ in thousands	0 – 12<br><br>Months	1 – 5<br><br>Years	Greater<br><br>Than 5<br><br>Years	Cross-<br><br>Maturity<br><br>Netting<br><br>(4)	Total
Commodity swaps, options and<br><br>forwards ......................................	$4,308	$—	$—	$—	$4,308
Equity options and forwards ..........	297,427	7,350	—	(220)	304,557
Credit default swaps .......................	—	24,840	—	—	24,840
Total return swaps ...........................	137,965	113,782	—	(15,878)	235,869
Foreign currency forwards, swaps<br><br>and options .................................	51,979	863	—	(555)	52,287
Fixed income forwards ...................	39,641	—	—	—	39,641
Interest rate swaps, options and<br><br>forwards ......................................	53,565	157,406	28,366	(16,967)	222,370
Total ...................................................	$584,885	$304,241	$28,366	$(33,620)	883,872
Cross-product counterparty<br><br>netting ..........................................					(35,717)
Total OTC derivative assets<br><br>included in Financial<br><br>instruments owned ....................					$848,155			OTC Derivative Liabilities (1) (2) (3)
---	---	---	---	---	---
$ in thousands	0 – 12<br><br>Months	1 – 5<br><br>Years	Greater<br><br>Than 5<br><br>Years	Cross-<br><br>Maturity<br><br>Netting<br><br>(4)	Total
Commodity swaps, options and<br><br>forwards ......................................	$2,829	$—	$—	$—	$2,829
Equity options and forwards ..........	104,168	323,381	—	(220)	427,329
Credit default swaps ........................	251	9,583	—	—	9,834
Total return swaps ...........................	161,468	90,507	37	(15,878)	236,134
Foreign currency forwards, swaps<br><br>and options .................................	90,526	420	—	(555)	90,391
Fixed income forwards ...................	5,839	—	—	—	5,839
Interest rate swaps, options and<br><br>forwards ......................................	33,944	86,299	454,080	(16,967)	557,356
Total ...................................................	$399,025	$510,190	$454,117	$(33,620)	1,329,712
Cross-product counterparty<br><br>netting ..........................................					(35,717)
Total OTC derivative liabilities<br><br>included in Financial<br><br>instruments sold, not yet<br><br>purchased ...................................					$1,293,995

(1)At August 31, 2025, we held net exchange-traded derivative assets and

liabilities with a fair value of $1.16 billion and $591.4 million, respectively,

which are not included in these tables.

(2)OTC derivative assets and liabilities in the tables above are gross of collateral

pledged. OTC derivative assets and liabilities are recorded net of collateral

pledged in our Consolidated Statements of Financial Condition. At August 31,

2025, cash collateral received and pledged was $273.6 million and $632.1

million, respectively.

(3)Derivative fair values include counterparty netting within product category.

(4)Amounts represent the netting of receivable balances with payable balances

for the same counterparty within product category across maturity categories.

OTC derivative assets at August 31, 2025:

Counterparty credit quality (1):	$ in thousands
A- or higher ...............................................................................................	$156,293
BBB- to BBB+ ...........................................................................................	44,065
BB+ or lower .............................................................................................	305,776
Unrated .....................................................................................................	342,021
Total ..........................................................................................................	$848,155

(1)We utilize internal credit ratings determined by our Risk Management

department. Credit ratings determined by Risk Management use

methodologies that produce ratings generally consistent with those produced

by external rating agencies.

Credit Related Derivative Contracts

External credit ratings of the underlyings or referenced assets for

our written credit related derivative contracts:

	August 31, 2025
	External Credit Rating
$ in millions	Investment<br><br>Grade	Non-<br><br>investment<br><br>Grade	Total<br><br>Notional
Credit protection sold:
Index credit default swaps .....................	$31.1	$364.1	$395.2			November 30, 2024
---	---	---	---
	External Credit Rating
$ in millions	Investment<br><br>Grade	Non-<br><br>investment<br><br>Grade	Total<br><br>Notional
Credit protection sold:
Index credit default swaps .....................	$395.2	$553.4	$948.6

Contingent Features

Certain of our derivative instruments contain provisions that

require our debt to maintain an investment grade credit rating

from each of the major credit rating agencies. If our debt were to

fall below investment grade, it would be in violation of these

provisions and the counterparties to the derivative instruments

could request immediate payment or demand immediate and

ongoing full overnight collateralization on our derivative

instruments in liability positions. The following table presents the

aggregate fair value of all derivative instruments with such credit-

risk-related contingent features that are in a liability position, the

collateral amounts we have posted or received in the normal

course of business and the potential collateral we would have

been required to return and/or post additionally to our

counterparties if the credit-risk-related contingent features

underlying these agreements were triggered:

$ in millions	August 31,<br><br>2025	November 30,<br><br>2024
Derivative instrument liabilities with credit-risk-<br><br>related contingent features ....................................	$139.5	$102.3
Collateral posted ...........................................................	(87.9)	(50.6)
Collateral received ........................................................	285.8	296.1
Return of and additional collateral required in the<br><br>event of a credit rating downgrade below<br><br>investment grade (1) ...............................................	337.4	347.8

(1)These potential outflows include initial margin received from counterparties at

the execution of the derivative contract. The initial margin will be returned if

counterparties elect to terminate the contract after a downgrade.

August 2025 Form 10-Q	25

Notes to Consolidated Financial Statements

(Unaudited)

Note 8. Collateralized Transactions

	August 31, 2025
$ in millions	Securities<br><br>Lending<br><br>Arrangements	Repurchase<br><br>Agreements	Obligation to<br><br>Return<br><br>Securities<br><br>Received as<br><br>Collateral, at<br><br>Fair Value	Total
Collateral Pledged:
Corporate equity<br><br>securities .....................	$1,982.5	$1,643.2	$—	$3,625.7
Corporate debt<br><br>securities .....................	448.9	3,252.0	—	3,700.9
Mortgage-backed and<br><br>asset-backed<br><br>securities .....................	—	1,455.0	—	1,455.0
U.S. government and<br><br>federal agency<br><br>securities .....................	36.7	8,764.4	—	8,801.1
Municipal securities ........	1.1	493.8	—	494.9
Sovereign obligations .....	28.8	1,857.6	54.2	1,940.6
Loans and other<br><br>receivables ..................	—	545.7	—	545.7
Total ..................................	$2,498.0	$18,011.7	$54.2	$20,563.9			November 30, 2024
---	---	---	---	---
$ in millions	Securities<br><br>Lending<br><br>Arrangements	Repurchase<br><br>Agreements	Obligation to<br><br>Return<br><br>Securities<br><br>Received as<br><br>Collateral, at<br><br>Fair Value	Total
Collateral Pledged:
Corporate equity<br><br>securities .....................	$2,059.8	$1,394.2	$3.9	$3,457.8
Corporate debt<br><br>securities .....................	416.4	4,522.5	—	4,938.9
Mortgage-backed and<br><br>asset-backed<br><br>securities .....................	—	2,384.8	—	2,384.8
U.S. government and<br><br>federal agency<br><br>securities .....................	30.9	6,837.1	—	6,868.0
Municipal securities ........	—	212.1	—	212.1
Sovereign obligations .....	33.7	1,981.0	181.7	2,196.4
Loans and other<br><br>receivables ..................	—	757.4	—	757.4
Total ..................................	$2,540.9	$18,088.9	$185.6	$20,815.4			August 31, 2025
---	---	---	---	---	---
$ in millions	Overnight<br><br>and<br><br>Continuous	Up to 30<br><br>Days	31-90<br><br>Days	Greater<br><br>than 90<br><br>Days	Total
Securities lending<br><br>arrangements ..............	$1,788.8	$70.8	$135.7	$502.7	$2,498.0
Repurchase agreements .	2,083.7	8,998.9	3,485.2	3,443.9	18,011.7
Obligation to return<br><br>securities received as<br><br>collateral, at fair<br><br>value .............................	54.2	—	—	—	54.2
Total ...................................	$3,926.7	$9,069.7	$3,620.9	$3,946.6	$20,563.9			November 30, 2024
---	---	---	---	---	---
$ in millions	Overnight<br><br>and<br><br>Continuous	Up to 30<br><br>Days	31-90<br><br>Days	Greater<br><br>than 90<br><br>Days	Total
Securities lending<br><br>arrangements ..............	$1,617.8	$154.3	$250.4	$518.4	$2,540.9
Repurchase agreements .	2,258.1	7,055.1	4,182.8	4,592.9	18,088.9
Obligation to return<br><br>securities received as<br><br>collateral, at fair<br><br>value .............................	185.6	—	—	—	185.6
Total ...................................	$4,061.5	$7,209.4	$4,433.2	$5,111.2	$20,815.4

We receive securities as collateral under resale agreements,

securities borrowing transactions, customer margin loans, and in

connection with securities-for-securities transactions in which we

are the lender of securities. We also receive securities as initial

margin on certain derivative transactions. In many instances, we

are permitted by contract to rehypothecate the securities

received as collateral. These securities may be used to secure

repurchase agreements, enter into securities lending

transactions, satisfy margin requirements on derivative

transactions or cover short positions. At August 31, 2025 and

November 30, 2024, the approximate fair value of securities

received as collateral by us that may be sold or repledged was

$45.77 billion and $37.63 billion, respectively. At August 31, 2025

and November 30, 2024, a substantial portion of the securities

received by us had been sold or repledged.

26	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Securities Financing Agreements

To manage our exposure to credit risk associated with securities financing transactions, we may enter into master netting agreements

and collateral arrangements with counterparties. Generally, transactions are executed under standard industry agreements, including,

but not limited to, master securities lending agreements (securities lending transactions) and master repurchase agreements

(repurchase transactions).

	August 31, 2025
$ in millions	Gross<br><br>Amounts	Netting in<br><br>Consolidated<br><br>Statements<br><br>of Financial<br><br>Condition	Net Amounts in<br><br>Consolidated<br><br>Statements of<br><br>Financial<br><br>Condition	Additional<br><br>Amounts<br><br>Available for<br><br>Setoff (1)	Available<br><br>Collateral (2)	Net<br><br>Amount (3)
Assets:
Securities borrowing arrangements ...................................	$8,175.1	$—	$8,175.1	$(359.8)	$(1,807.9)	$6,007.4
Reverse repurchase agreements .........................................	13,838.6	(5,921.1)	7,917.5	(2,007.4)	(5,809.4)	100.7
Securities received as collateral, at fair value ...................	54.2	—	54.2	—	(54.2)	—
Liabilities:
Securities lending arrangements ........................................	$2,498.0	$—	$2,498.0	$(359.8)	$(2,088.4)	$49.8
Repurchase agreements .......................................................	18,011.7	(5,921.1)	12,090.6	(2,007.4)	(9,471.1)	612.1
Obligation to return securities received as collateral, at<br><br>fair value .............................................................................	54.2	—	54.2	—	(54.2)	—			November 30, 2024
---	---	---	---	---	---	---
$ in millions	Gross<br><br>Amounts	Netting in<br><br>Consolidated<br><br>Statements<br><br>of Financial<br><br>Condition	Net Amounts in<br><br>Consolidated<br><br>Statements of<br><br>Financial<br><br>Condition	Additional<br><br>Amounts<br><br>Available for<br><br>Setoff (1)	Available<br><br>Collateral (2)	Net<br><br>Amount (4)
Assets:
Securities borrowing arrangements ...................................	$7,213.4	$—	$7,213.4	$(325.4)	$(1,537.3)	$5,350.7
Reverse repurchase agreements .........................................	11,930.7	(5,751.0)	6,179.7	(1,475.9)	(4,574.0)	129.8
Securities received as collateral, at fair value ...................	185.6	—	185.6	—	(185.6)	—
Liabilities:
Securities lending arrangements ........................................	$2,540.9	$—	$2,540.9	$(325.4)	$(2,091.4)	$124.1
Repurchase agreements .......................................................	18,088.9	(5,751.0)	12,337.9	(1,475.9)	(10,274.6)	587.4
Obligation to return securities received as collateral, at<br><br>fair value .............................................................................	185.6	—	185.6	—	(185.6)	—

(1)Under master netting agreements with our counterparties, we have the legal right of offset with a counterparty, which incorporates all of the counterparty’s outstanding

rights and obligations under the arrangement. These balances reflect additional credit risk mitigation that is available by a counterparty in the event of a counterparty’s

default, but which are not netted in our Consolidated Statements of Financial Condition because other netting provisions of U.S. GAAP are not met.

(2)Includes securities received or paid under collateral arrangements with counterparties that could be liquidated in the event of a counterparty default and thus offset

against a counterparty’s rights and obligations under the respective repurchase agreements or securities borrowing or lending arrangements.

(3)Includes $5.94 billion of securities borrowing arrangements, for which we have received securities collateral of $5.77 billion, and $520.0 million of repurchase

agreements, for which we have pledged securities collateral of $529.5 million, which are subject to master netting agreements, but we have not determined the

agreements to be legally enforceable.

(4)Includes $5.31 billion of securities borrowing arrangements, for which we have received securities collateral of $5.19 billion, and $645.0 million of repurchase

agreements, for which we have pledged securities collateral of $656.9 million, which are subject to master netting agreements, but we have not determined the

agreements to be legally enforceable.

August 2025 Form 10-Q	27

Notes to Consolidated Financial Statements

(Unaudited)

Cash and Securities Segregated and on Deposit for Regulatory

Purposes or Deposited with Clearing and Depository

Organizations

Cash and securities segregated in accordance with regulatory

regulations and deposited with clearing and depository

organizations primarily consist of deposits in accordance with

Rule 15c3-3 of the Securities Exchange Act of 1934, which

subjects Jefferies LLC as a broker-dealer carrying customer

accounts to requirements related to maintaining cash or qualified

securities in segregated special reserve bank accounts for the

exclusive benefit of its customers.

$ in millions	August 31,<br><br>2025	November 30,<br><br>2024
Cash and securities segregated and on<br><br>deposit for regulatory purposes or<br><br>deposited with clearing and depository<br><br>organizations ..................................................	$1,111.6	$1,132.6

Note 9. Securitization Activities

We engage in securitization activities related to corporate loans,

mortgage loans, consumer loans and mortgage-backed and other

asset-backed securities. In our securitization transactions, we

transfer these assets to special purpose entities (“SPEs”) and act

as the placement or structuring agent for the beneficial interests

sold to investors by the SPE. A portion of our securitization

transactions are the securitization of assets issued or

guaranteed by U.S. government agencies. These SPEs generally

meet the criteria of VIEs; however, we generally do not

consolidate the SPEs as we are not considered the primary

beneficiary for these SPEs. Refer to Note 10, Variable Interest

Entities for further discussion on VIEs and our determination of

the primary beneficiary.

We account for our securitization transactions as sales, provided

we have relinquished control over the transferred assets.

Transferred assets are carried at fair value with unrealized gains

and losses reflected in Principal transactions revenues prior to

the identification and isolation for securitization. Subsequently,

revenues recognized upon securitization are reflected as net

underwriting revenues. We generally receive cash proceeds in

connection with the transfer of assets to an SPE. We may,

however, have continuing involvement with the transferred

assets, which is limited to retaining one or more tranches of the

securitization (primarily senior and subordinated debt securities

in the form of mortgage-backed and other-asset backed

securities or CLOs). These securities are included in Financial

instruments owned, at fair value and are generally initially

categorized as Level 2 within the fair value hierarchy.

Securitizations that were accounted for as sales in which we had

continuing involvement:

	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
$ in millions	2025	2024	2025	2024
Transferred assets .....................	$1,451.8	$878.0	$4,085.3	$3,446.7
Proceeds on new<br><br>securitizations .......................	1,451.8	878.0	4,085.3	3,446.7
Cash flows received on<br><br>retained interests ..................	6.7	9.5	18.1	28.8

We have no explicit or implicit arrangements to provide additional

financial support to these SPEs, have no liabilities related to

these SPEs and do not have any outstanding derivative contracts

executed in connection with these securitization activities at

August 31, 2025 and November 30, 2024.

Our retained interests in SPEs where we transferred assets and

have continuing involvement and received sale accounting

treatment:

$ in millions	August 31, 2025		November 30, 2024
Securitization Type	Total<br><br>Assets	Retained<br><br>Interests	Total<br><br>Assets	Retained<br><br>Interests
U.S. government agency RMBS ...	$461.8	$12.6	$3,956.8	$105.7
U.S. government agency CMBS ...	919.9	24.9	1,817.1	91.8
CLOs .................................................	10,238.3	48.4	9,001.9	37.2
Consumer and other loans ...........	2,138.2	80.1	1,424.4	52.1

Total assets represent the unpaid principal amount of assets in

the SPEs in which we have continuing involvement and are

presented solely to provide information regarding the size of the

transactions and the size of the underlying assets supporting our

retained interests and are not considered representative of the

risk of potential loss. Assets retained in connection with a

securitization transaction represent the fair value of the

securities of one or more tranches issued by an SPE, including

senior and subordinated tranches. Our risk of loss is limited to

this fair value amount which is included in total Financial

instruments owned in our Consolidated Statements of Financial

Condition.

Although not obligated, in connection with secondary market-

making activities we may make a market in the securities issued

by these SPEs. In these market-making transactions, we buy

these securities from and sell these securities to investors.

Securities purchased through these market-making activities are

not considered to be continuing involvement in these SPEs. To

the extent we purchased securities through these market-making

activities, and we are not deemed to be the primary beneficiary of

the VIE, these securities are included in agency and non-agency

mortgage-backed and asset-backed securitizations in the

nonconsolidated VIEs section presented in Note 10, Variable

Interest Entities.

Note 10. Variable Interest Entities

VIEs are entities in which equity investors lack the characteristics

of a controlling financial interest. VIEs are consolidated by the

primary beneficiary. The primary beneficiary is the party who has

both (1) the power to direct the activities of a VIE that most

significantly impact the entity’s economic performance and (2)

an obligation to absorb losses of the entity or a right to receive

benefits from the entity that could potentially be significant to the

entity.

Our variable interests in VIEs include debt and equity interests,

commitments, guarantees and certain fees. Our involvement with

VIEs arises primarily from:

•Purchases of securities in connection with our trading and

secondary market making activities;

•Retained interests held as a result of securitization activities;

•Acting as placement agent and/or underwriter in connection

with client-sponsored securitizations;

•Financing of agency and non-agency mortgage-backed and

other asset-backed securities;

•Acting as servicer for a fee to automobile loan financing

vehicles;

28	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

•Warehouse funding arrangements for client-sponsored

consumer and mortgage loan vehicles and CLOs through

participation agreements, forward sale agreements, reverse

repurchase agreements, and revolving loan and note

commitments; and

•Loans to, investments in and fees from various investment

vehicles.

We determine whether we are the primary beneficiary of a VIE

upon our initial involvement with the VIE and we reassess

whether we are the primary beneficiary of a VIE on an ongoing

basis. Our determination of whether we are the primary

beneficiary of a VIE is based upon the facts and circumstances

for each VIE and requires judgment. Our considerations in

determining the VIE’s most significant activities and whether we

have power to direct those activities include, but are not limited

to, the VIE’s purpose and design and the risks passed through to

investors, the voting interests of the VIE, management, service

and/or other agreements of the VIE, involvement in the VIE’s

initial design and the existence of explicit or implicit financial

guarantees. In situations where we have determined that the

power over the VIE’s significant activities is shared, we assess

whether we are the party with the power over the most significant

activities. If we are the party with the power over the most

significant activities, we meet the “power” criteria of the primary

beneficiary. If we do not have the power over the most significant

activities or we determine that decisions require consent of each

sharing party, we do not meet the “power” criteria of the primary

beneficiary.

We assess our variable interests in a VIE both individually and in

aggregate to determine whether we have an obligation to absorb

losses of or a right to receive benefits from the VIE that could

potentially be significant to the VIE. The determination of whether

our variable interest is significant to the VIE requires judgment. In

determining the significance of our variable interest, we consider

the terms, characteristics and size of the variable interests, the

design and characteristics of the VIE, our involvement in the VIE

and our market-making activities related to the variable interests.

Consolidated VIEs:

	August 31, 2025 (1)
$ in millions	Secured<br><br>Funding<br><br>Vehicles	Other
Cash ...................................................................................	$—	$2.1
Financial instruments owned ........................................	—	64.5
Securities purchased under agreements to resell (2)	3,196.0	—
Receivables from brokers (3) .........................................	—	22.2
Other receivables .............................................................	1.7	3.0
Other assets (4) ...............................................................	—	87.6
Total assets ......................................................................	$3,197.7	$179.4
Financial instruments sold, not yet purchased ...........	$—	$6.5
Other secured financings (5) .........................................	3,195.8	25.7
Other liabilities (6) ...........................................................	6.2	28.9
Long-term debt ................................................................	—	70.1
Total liabilities .................................................................	$3,202.0	$131.2			November 30, 2024 (1)
---	---	---
$ in millions	Secured<br><br>Funding<br><br>Vehicles	Other
Cash ...................................................................................	$—	$1.6
Financial instruments owned .........................................	—	40.0
Securities purchased under agreements to resell (2)	2,829.7	—
Receivables from brokers (3) .........................................	—	23.5
Other receivables .............................................................	—	3.0
Other assets (4) ...............................................................	—	90.3
Total assets ......................................................................	$2,829.7	$158.4
Financial instruments sold, not yet purchased ...........	$—	$7.6
Other secured financings (5) .........................................	2,823.0	26.1
Other liabilities (6) ...........................................................	6.7	23.1
Long-term debt ................................................................	—	70.1
Total liabilities .................................................................	$2,829.7	$126.9

(1)Assets and liabilities are presented prior to consolidation and thus a portion of

these assets and liabilities are eliminated in consolidation.

(2)Securities purchased under agreements to resell primarily represent amounts

due under collateralized transactions from related consolidated entities, which

are all eliminated in consolidation.

(3)$0.5 million and $1.5 million of receivables from brokers at August 31, 2025

and November 30, 2024, respectively, are with related consolidated entities,

which are eliminated in consolidation.

(4)$3.3 million and $3.4 million of the other assets at August 31, 2025 and

November 30, 2024, respectively, represent intercompany receivables with

related consolidated entities, which are eliminated in consolidation.

(5)$713.5 million and $719.0 million of the other secured financings at

August 31, 2025 and November 30, 2024, respectively, are with related

consolidated entities and are eliminated in consolidation.

(6)$27.6 million and $22.0 million of the other liabilities amounts at August 31,

2025 and November 30, 2024, respectively, are with related consolidated

entities, which are eliminated in consolidation.

Secured Funding Vehicles. We are the primary beneficiary of

asset-backed financing vehicles to which we sell agency and non-

agency residential and commercial mortgage loans, and asset-

backed securities pursuant to the terms of a master repurchase

agreement. Our variable interests in these vehicles consist of our

collateral margin maintenance obligations under the master

repurchase agreement, which we manage, and retained interests

in securities issued. The assets of these VIEs consist of reverse

repurchase agreements, which are available for the benefit of the

vehicle’s debt holders. In addition, we also from time to time

securitize other financial instruments and own variable interests

in the securitization vehicles to the extent that we consolidate

such vehicles.

Other. We are the primary beneficiary of certain investment

vehicles that we manage for external investors and certain

investment vehicles set up for the benefit of our employees as

well as investment vehicles managed by third parties where we

have a controlling financial interest. The assets of these VIEs

consist primarily of equity securities and broker receivables. Our

variable interests in these vehicles consist of equity securities,

management and performance fees and revenue share. The

creditors of these VIEs do not have recourse to our general credit

and each such VIE’s assets are not available to satisfy any other

debt.

We are the primary beneficiary of a real estate syndication entity

that develops multi-family residential property and manages the

property. The assets of the VIE consist primarily of real estate

and its liabilities primarily consist of accrued expenses and long-

term debt secured by the real estate property. Our variable

interest in the VIE primarily consists of our limited liability

company interest, a sponsor promote and development and

asset management fees for managing the project.

August 2025 Form 10-Q	29

Notes to Consolidated Financial Statements

(Unaudited)

We are the primary beneficiary of special purpose vehicles that

hold risk retention notes issued as part of unsecured loan asset-

backed transactions. Our variable interest in the VIEs primarily

consists of our ownership of certificates issued by the VIEs.

Nonconsolidated VIEs

	August 31, 2025
	Carrying Amount		Maximum<br><br>Exposure to<br><br>Loss	VIE Assets
$ in millions	Assets	Liabilities
CLOs ......................................	$716.9	$41.3	$7,295.8	$15,893.2
Asset-backed vehicles ........	987.4	—	1,249.7	4,917.3
Related party private equity<br><br>vehicles ............................	3.9	—	15.0	51.0
Other investment vehicles ..	1,468.4	—	1,850.2	28,117.2
Total .......................................	$3,176.6	$41.3	$10,410.7	$48,978.7			November 30, 2024
---	---	---	---	---
	Carrying Amount		Maximum<br><br>Exposure to<br><br>Loss	VIE Assets
$ in millions	Assets	Liabilities
CLOs ......................................	$951.8	$26.5	$6,511.1	$14,872.4
Asset-backed vehicles ........	827.4	—	946.3	4,266.7
Related party private equity<br><br>vehicles ............................	3.7	—	14.0	34.4
Other investment vehicles ..	1,107.8	—	1,365.8	19,064.1
Total .......................................	$2,890.7	$26.5	$8,837.2	$38,237.6

Our maximum exposure to loss often differs from the carrying

value of the variable interests. The maximum exposure to loss is

dependent on the nature of our variable interests in the VIEs and

is limited to the notional amounts of certain loan and equity

commitments and guarantees. Our maximum exposure to loss

does not include the offsetting benefit of any financial

instruments that may be utilized to hedge the risks associated

with our variable interests and is not reduced by the amount of

collateral held as part of a transaction with a VIE.

Collateralized Loan Obligations. Assets collateralizing the CLOs

include bank loans, participation interests, sub-investment grade

and senior secured U.S. loans, and senior secured Euro-

denominated corporate leveraged loans and bonds. We

underwrite securities issued in CLO transactions on behalf of

sponsors and provide advisory services to the sponsors. We may

also sell corporate loans to the CLOs. Our variable interests in

connection with CLOs where we have been involved in providing

underwriting and/or advisory services consist of the following:

•Forward sale agreements whereby we commit to sell, at a fixed

price, corporate loans and ownership interests in an entity

holding such corporate loans to CLOs;

•Warehouse funding arrangements in the form of:

◦Participation interests in corporate loans held by CLOs and

commitments to fund such participation interests;

◦Reverse repurchase agreements with collateral margin

maintenance obligations and commitments to fund such

reverse repurchase agreements; and

◦Senior and subordinated notes issued in connection with

CLO warehousing activities.

•Trading positions in securities issued in CLO transactions; and

•Investments in variable funding notes issued by CLOs.

Asset-Backed Vehicles. We provide financing and lending related

services to certain client-sponsored VIEs in the form of revolving

funding note agreements, revolving credit facilities, forward

purchase agreements and reverse repurchase agreements. We

also may transfer originated corporate loans to certain VIEs and

hold subordinated interests issued by the vehicle. The underlying

assets, which are collateralizing the vehicles, are primarily

composed of unsecured consumer loans, mortgage loans and

corporate loans. In addition, we may provide structuring and

advisory services and act as an underwriter or placement agent

for securities issued by the vehicles. We do not control the

activities of these entities.

Related Party Private Equity Vehicles. We have committed to

invest in private equity funds, which are in the process of being

fully liquidated (the “JCP Funds”, including JCP Fund V (refer to

Note 11, Investments for further information)), managed by

Jefferies Capital Partners, LLC (the “JCP Manager”). Additionally,

we have committed to invest in the general partners of the JCP

Funds (the “JCP General Partners”) and the JCP Manager. Our

variable interests in the JCP Funds, JCP General Partners and

JCP Manager (collectively, the “JCP Entities”) consist of equity

interests that, in total, provide us with limited and general partner

investment returns of the JCP Funds, a portion of the carried

interest earned by the JCP General Partners and a portion of the

management fees earned by the JCP Manager. At both

August 31, 2025 and November 30, 2024, our total equity

commitment in the JCP Entities was $133.0 million, of which

$123.2 million had been funded. The carrying value of our equity

investments in the JCP Entities was $3.3 million and $3.2 million

at August 31, 2025 and November 30, 2024, respectively. Our

exposure to loss is limited to the total of our carrying value and

unfunded equity commitment. The assets of the JCP Entities

primarily consist of private equity and equity related investments.

At both August 31, 2025 and November 30, 2024, we had also

committed to invest $1.0 million, of which $0.6 million was

funded in a private equity fund managed by us for the benefit of

our employees. The carrying value of our equity was $0.6 million

and $0.5 million at August 31, 2025 and November 30, 2024,

respectively.

Other Investment Vehicles. At August 31, 2025 and November 30,

2024, we had equity commitments to invest $1.77 billion and

$1.43 billion, respectively, in various other investment vehicles, of

which $1.39 billion and $1.17 billion was funded, respectively.

The carrying value of our equity investments was $1.47 billion

and $1.11 billion at August 31, 2025 and November 30, 2024,

respectively. Our exposure to loss is limited to the total of our

carrying value and unfunded equity commitment. These

investment vehicles have assets primarily consisting of private

and public equity investments, debt instruments, trade and

insurance claims and various oil and gas assets.

Mortgage-Backed and Other Asset-Backed Secured Funding

Vehicles. In connection with our secondary trading and market-

making activities, we buy and sell agency and non-agency

mortgage-backed securities and other asset-backed securities,

which are issued by third-party securitization SPEs and are

generally considered variable interests in VIEs. Securities issued

by securitization SPEs are backed by residential mortgage loans,

U.S. agency collateralized mortgage obligations, commercial

mortgage loans, CDOs and CLOs and other consumer loans, such

as installment receivables, automobile loans and student loans.

These securities are accounted for at fair value and included in

Financial instruments owned. We have no other involvement with

the related SPEs and therefore do not consolidate these entities.

30	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

We also engage in underwriting, placement and structuring

activities for third-party-sponsored securitization trusts generally

through agency (Fannie Mae, Federal Home Loan Mortgage

Corporation (“Freddie Mac”) or Ginnie Mae) or non-agency-

sponsored SPEs and may purchase loans or mortgage-backed

securities from third-parties that are subsequently transferred

into the securitization trusts. The securitizations are backed by

residential and commercial mortgage, home equity and

automobile loans. We do not consolidate agency-sponsored

securitizations as we do not have the power to direct the

activities of the SPEs that most significantly impact their

economic performance. Further, we are not the servicer of non-

agency-sponsored securitizations and therefore do not have

power to direct the most significant activities of the SPEs and

accordingly, do not consolidate these entities. We may retain

unsold senior and/or subordinated interests at the time of

securitization in the form of securities issued by the SPEs.

At August 31, 2025 and November 30, 2024, we held $1.16 billion

and $1.84 billion of agency mortgage-backed securities,

respectively, and $189.8 million and $201.1 million of non-agency

mortgage-backed and other asset-backed securities, respectively,

as a result of our secondary trading and market-making activities,

and underwriting, placement and structuring activities. Our

maximum exposure to loss on these securities is limited to the

carrying value of our investments in these securities. These

mortgage-backed and other asset-backed secured funding

vehicles discussed are not included in the above table containing

information about our variable interests in nonconsolidated VIEs.

Note 11. Investments

Investments for which we exercise significant influence over the

investee are accounted for under the equity method of

accounting with our shares of the investees’ earnings recognized

in Other revenues. Equity method investments, including any

loans to the investees, are reported within Investments in and

loans to related parties.

$ in millions	August 31,<br><br>2025	November 30,<br><br>2024
Total Investments in and loans to related<br><br>parties ........................................................	$1,458.3	$1,385.7			Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
---	---	---	---	---
$ in millions	2025	2024	2025	2024
Total equity method pickup<br><br>earnings recognized in Other<br><br>revenues ...................................	$39.1	$25.0	$54.3	$62.2

The following presents summarized financial information about

our significant equity method investees. For certain investees, we

receive financial information on a lag and the summarized

information provided for these investees is based on the latest

financial information available as of August 31, 2025,

November 30, 2024 and August 31, 2024.

Jefferies Finance

Jefferies Finance, our 50/50 joint venture with Massachusetts

Mutual Life Insurance Company (“MassMutual”) structures,

underwrites and syndicates primarily senior secured loans to

corporate borrowers; and manages proprietary and third-party

investments in both broadly syndicated and direct lending loans.

In connection with its Leveraged Finance business, loans are

originated primarily through our investment banking efforts and

Jefferies Finance typically syndicates to third-party investors

substantially all of its arranged volume through us. The Asset

Management business is a multi-strategy private credit platform

that manages proprietary and third-party capital across

commingled funds, funds-of-one, separately managed accounts,

business development companies, CLOs and levered balance

sheet funds. Broadly syndicated loan investments are sourced

through transactions arranged by Jefferies Finance and third-

party arrangers and managed through its subsidiary, Apex Credit

Partners LLC. Direct lending investments are primarily sourced

through us. Jefferies Finance and its subsidiaries that are

involved in investment management are registered investment

advisers with the SEC.

At August 31, 2025, we and MassMutual each had equity

commitments to Jefferies Finance of $750.0 million, for a

combined total commitment of $1.5 billion. The equity

commitment is reduced quarterly based on our share of any

undistributed earnings from Jefferies Finance and the

commitment is increased only to the extent the share of such

earnings are distributed. At August 31, 2025, our unfunded

commitment to Jefferies Finance was $15.4 million. The

investment commitment is scheduled to expire on March 1, 2026

with automatic one year extensions absent a 60 day termination

notice by either party.

Jefferies Finance has executed a Secured Revolving Credit

Facility with us and MassMutual, to be funded equally, to support

loan underwritings by Jefferies Finance, which bears interest

based on the interest rates of the related Jefferies Finance

underwritten loans and is secured by the underlying loans funded

by the proceeds of the facility. The total Secured Revolving Credit

Facility is a committed amount of $500.0 million at August 31,

2025. Advances are shared equally between us and MassMutual.

The facility is scheduled to mature on March 1, 2026 with

automatic one year extensions absent a 60 day termination

notice by either party. At August 31, 2025, our $250.0 million

commitment was undrawn.

Activity related to the facility:

	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
$ in millions	2025	2024	2025	2024
Unfunded commitment fees .........	$0.3	$0.3	$0.9	$0.9

Selected financial information for Jefferies Finance:

$ in millions	August 31,<br><br>2025	November 30,<br><br>2024
Total assets ....................................................	$7,239.5	$5,762.6
Total liabilities ................................................	5,867.5	4,415.6
Total mezzanine equity .................................	14.3	14.4		$ in millions	August 31,<br><br>2025	November 30,<br><br>2024
---	---	---
Our total investment balance .......................	$678.8	$666.3			Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
---	---	---	---	---
$ in millions	2025	2024	2025	2024
Net earnings attributable to<br><br>members ....................................	$27.0	$28.8	$25.4	$68.1
August 2025 Form 10-Q	31
---	---

Notes to Consolidated Financial Statements

(Unaudited)

Activity related to our other transactions with Jefferies Finance:

	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
$ in millions	2025	2024	2025	2024
Origination and syndication fee<br><br>revenues (1) ............................	$73.3	$72.9	$191.9	$200.2
Origination fee expenses (1) .....	18.3	16.2	50.7	40.8
CLO placement and structuring<br><br>fee revenues (2) ....................	0.8	0.8	2.3	1.1
Placement and referral fees (3)	6.1	2.4	16.1	3.3
Asset management fee<br><br>revenues (4) .............................	—	—	7.5	—
Underwriting fees (5) ..................	0.5	—	0.5	—
Service fee revenues (6) .............	24.0	15.3	101.0	81.0

(1)We engage in the origination and syndication of loans underwritten by

Jefferies Finance. In connection with such services, we earned fees, which are

recognized in Investment banking revenues. In addition, we paid fees to

Jefferies Finance in respect of certain loans originated by Jefferies Finance,

which are recognized as Business development expenses.

(2)We act as a placement and/or structuring agent for CLOs managed by

Jefferies Finance, for which we recognized fees and are included in

Investment banking revenues.

(3)We receive fees from Jefferies Finance, which are recognized in Commissions

and other fees, in connection with placement and referral activities.

(4)Under a fee and revenue sharing agreement with Jefferies Finance, we receive

fees which are included in Asset management fees and revenues.

(5)We act as an underwriter in connection with term loans issued by Jefferies

Finance.

(6)Under a service agreement, we charge Jefferies Finance for various

administrative services provided.

Additional balances with Jefferies Finance as reported in our

Consolidated Statements of Financial Condition.

$ in millions	August 31,<br><br>2025	November 30,<br><br>2024
Assets
Financial instruments owned, at fair value (1) .........	$4.6	$—
Other assets (2) ............................................................	5.3	1.9
Liabilities
Financial instruments sold, not yet purchased, at<br><br>fair value (1) .............................................................	$0.4	$—
Payables:
Brokers, dealers and clearing organizations (3) .	15.7	—
Customers (4) ..........................................................	2.2	13.7

(1)In connection with our capital markets activities, from time to time we make a

market in long-term debt securities of Jefferies Finance (i.e., we buy and sell

debt securities issued by Jefferies Finance).

(2)Receivable from Jefferies Finance pending settlement.

(3)Cash collateral, net, received from Jefferies Finance on OTC foreign currency

trading.

(4)Payable to Jefferies Finance in connection with loans originated by Jefferies

Finance to borrowers who are investment banking clients of ours. We have

also entered into an agreement to indemnify Jefferies Finance with respect to

any foreign currency exposure on these loans.

Berkadia

Berkadia is a commercial real estate finance and investment

sales joint venture that was formed by us and Berkshire

Hathaway Inc. We are entitled to receive 45.0% of the profits of

Berkadia. Berkadia originates commercial and multifamily real

estate loans that are sold to U.S. government agencies or other

investors with Berkadia retaining the servicing rights. Berkadia

also provides advisory services in connection with sales of

multifamily assets. Berkadia is a servicer of commercial real

estate loans in the U.S., performing primary, master and special

servicing functions for U.S. government agency programs and

financial services companies.

Commercial paper issued by Berkadia is supported by a

$1.50 billion surety policy issued by a Berkshire Hathaway

insurance subsidiary, for which we receive a surety fee,  and a

corporate guaranty, and we have agreed to reimburse Berkshire

Hathaway for one-half of any losses incurred thereunder. At

August 31, 2025, the aggregate amount of commercial paper

outstanding was $1.47 billion.

Selected financial information for Berkadia:

$ in millions	August 31,<br><br>2025	November 30,<br><br>2024
Total assets ...................................................	$5,579.9	$4,963.2
Total liabilities ...............................................	4,247.2	3,515.6
Total noncontrolling interest .......................	390.5	502.1		$ in millions	August 31,<br><br>2025	November 30,<br><br>2024
---	---	---
Our total investment balance .......................	$427.1	$427.7			Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
---	---	---	---	---
$ in millions	2025	2024	2025	2024
Net earnings attributable to<br><br>members ....................................	$70.9	$41.4	$152.9	$119.6			Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
---	---	---	---	---
$ in millions	2025	2024	2025	2024
Distributions ....................................	$42.3	$28.0	$69.3	$34.7

At August 31, 2025 and November 30, 2024, we had

commitments to purchase $13.7 million and $21.8 million,

respectively, of agency CMBS from Berkadia.

Revenues from other transactions with Berkadia for the nine

months ending August 31, 2025 were $0.1 million. Revenues and

expenses from other transactions with Berkadia for the nine

months ended August 31, 2024 were $0.3 million and

$0.4 million, respectively.

Real Estate Investments

Our real estate equity method investments primarily consist of

our equity interests in Brooklyn Renaissance Plaza and Hotel and

54 Madison. Brooklyn Renaissance Plaza is composed of a hotel,

office building complex and parking garage located in Brooklyn,

New York. We have a 25.4% equity interest in the hotel and a

61.3% equity interest in the office building and garage. Although

we have a majority interest in the office building and garage, we

do not have control, but only have the ability to exercise

significant influence on this investment. We are amortizing our

basis difference between the estimated fair value and the

underlying book value of Brooklyn Renaissance office building

and garage over the respective useful lives (weighted average life

of 39 years).

32	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

We own a 48.1% equity interest in 54 Madison, a fund that most

recently owned an interest in one real estate project and the fund

is in the process of being liquidated.

Selected financial information for our significant real estate

investments:

$ in millions	August 31,<br><br>2025	November 30,<br><br>2024
Total assets ....................................................	$313.4	$326.0
Total liabilities ................................................	473.3	484.7
	August 31,<br><br>2025	November 30,<br><br>2024
Our total investment balance .......................	$98.2	$97.8			Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
---	---	---	---	---
$ in millions	2025	2024	2025	2024
Net earnings (losses) ....................	$0.4	$2.9	$1.7	$3.0			Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
---	---	---	---	---
$ in millions	2025	2024	2025	2024
Distributions we received<br><br>from Brooklyn Renaissance<br><br>Office .......................................	$—	$—	$1.2	$—

JCP Fund V

We have limited partnership interests of 11% and 50% in Jefferies

Capital Partners V L.P. and Jefferies SBI USA Fund L.P. (together,

“JCP Fund V”), respectively, which are private equity funds

managed by a team led by our President and which are in the

process of being fully liquidated. The amount of our investments

in JCP Fund V included in Financial instruments owned, at fair

value was $3.3 million and $2.9 million at August 31, 2025 and

November 30, 2024, respectively. We account for these

investments at fair value based on the NAV of the funds provided

by the fund managers. The following summarizes the results

from these investments which are included in Principal

transactions revenues:

	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
$ in millions	2025	2024	2025	2024
Net gains (losses) from our<br><br>investments in JCP Fund V .....	$0.6	$(0.1)	$0.4	$(0.3)

At both August 31, 2025 and November 30, 2024, we were

committed to invest equity of up to $85.0 million in JCP Fund V.

At both August 31, 2025 and November 30, 2024, our unfunded

commitment relating to JCP Fund V was $8.7 million. We do not

expect any further capital to be called by JCP Fund V.

The following is a summary of the Net change in net assets

resulting from operations for 100.0% of JCP Fund V, in which we

owned effectively 35.1% at August 31, 2025 of the combined

equity interests:

	Three Months Ended
$ in millions	June 30,<br><br>2025	March 31,<br><br>2025	December 31,<br><br>2024	June 30,<br><br>2024	March 31,<br><br>2024	December 31,<br><br>2023
Net increase<br><br>(decrease) in net<br><br>assets resulting<br><br>from operations (1)	$1.7	$0.1	$(0.6)	$(0.3)	$0.1	$(0.9)

(1)Financial information for JCP Fund V within our results of operations for the

three and nine months ended August 31, 2025 and 2024 is included based on

the periods presented.

Hildene

In July 2024, we invested $25.0 million in the Class A Common

Equity Units of Hildene Insurance Holdings, LLC (“Hildene

Insurance”), an investment fund with insurance exposures. On

March 1, 2025, we made an additional investment of

$75.0 million in Hildene Insurance, which resulted in an increase

of our effective ownership from 8.83% to 23.5%. The investment

is accounted for under the equity method with a carrying amount

of $108.0 million and $27.5 million at August 31, 2025 and

November 30, 2024, respectively.

Selected financial information for Hildene Insurance:

$ in millions	June 30,<br><br>2025 (1)	September 30,<br><br>2024 (1)
Total assets ...............................................................	$466.3	$304.2
Total liabilities ...........................................................	0.7	0.2
Total members’ equity .............................................	465.6	304.0			Three Months Ended (1)
---	---	---	---
$ in millions	June 30,<br><br>2025	March 31,<br><br>2025	December 31,<br><br>2024
Net increase in members’ equity resulting from<br><br>operations ..........................................................................	$44.9	$27.5	$8.4

(1)Financial information for Hildene Insurance Holdings, LLC included in our

financial position at August 31, 2025 and November 30, 2024 is based on the

dates presented, and in our results of operations for the three and nine

months ended August 31, 2025 is based on the periods presented.

ApiJect

We own shares that represent a 33.6% economic interest in

ApiJect at both August 31, 2025 and at November 30, 2024,

which are accounted for at fair value by electing the fair value

option available under U.S. GAAP, and are included within

corporate equity securities in Financial instruments owned, at fair

value. At both August 31, 2025 and November 30, 2024, the total

fair value of our total equity investment in common shares of

ApiJect was $116.1 million, which is classified within Level 3 of

the fair value hierarchy.

Additionally, we own warrants to purchase up to 950,000 shares

of common stock at any time or from time to time on or before

April 15, 2032, and we have a right to 1.125% of ApiJect’s future

revenues.

We also have a term loan agreement with a principal of ApiJect

for $23.3 million, which matures on October 31, 2025. The loan is

accounted for at amortized cost and is reported within Other

assets. The loan has a fair value of $23.3 million at both

August 31, 2025 and November 30, 2024, which would be

classified as Level 3 in the fair value hierarchy.

Aircadia

In December 2023, Aircadia Leasing II LLC (“Aircadia”), a wholly

owned subsidiary, purchased airplanes from one of our clients

and simultaneously entered into a lease with the seller to lease

the airplanes for a term of 42 months. The transaction was

accounted for as a sale leaseback and the airplanes were

recorded within Premises and equipment at $57.7 million.

	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
$ in millions	2025	2024	2025	2024
Operating lease income ................	$—	$5.6	$6.9	$15.0
August 2025 Form 10-Q	33
---	---

Notes to Consolidated Financial Statements

(Unaudited)

Also in December 2023, we provided a loan to the seller for

$30.0 million, which was paid off on April 1, 2025. The loan was

accounted for at amortized cost and included within Investments

in and loans to related parties. We recognized interest income of

$1.0 million on the loan during the nine months ended August 31,

2025, and $0.8 million and $2.2 million during the three and nine

months ended August 31, 2024, respectively. We also hold

preferred shares in the seller, which are accounted for at fair

value in Financial instruments owned with a fair value of $43.7

million and $37.1 million at August 31, 2025 and November 30,

2024, respectively, and are classified within Level 3 of the fair

value hierarchy.

In September 2024, we provided a €15.0 million loan, maturing in

November 2025, to an individual related to the seller, secured by

a privately owned aircraft and guaranteed by the individual. We

recognized interest income of $0.5 million and $1.5 million for

the three months and nine months ended August 31, 2025,

respectively.

During 2024, we classified the airplanes related to the sale

leaseback transaction as held for sale. Effective with the

designation of the airplanes as held for sale, we suspended

recording depreciation on these assets. The airplanes were

included within Assets held for sale on our Consolidated

Statements of Financial Condition and had a carrying amount of

$51.9 million at November 30, 2024. During the second quarter of

2025, we agreed to sell the airplanes and we recognized a loss of

$12.8 million during the three months ended May 31, 2025. The

sale closed in the third quarter of 2025.

Note 12. Credit Losses on Financial Assets Measured at

Amortized Cost

Secured Financing Receivables. In evaluating secured financing

receivables (reverse repurchases agreements, securities

borrowing arrangements, and margin loans), the underlying

collateral maintenance provisions are taken into consideration.

The underlying contractual collateral maintenance for

significantly all of our secured financing receivables requires that

the counterparty continually adjust the collateralization amount,

securing the credit exposure on these contracts. Collateralization

levels for our secured financing receivables are initially

established based upon the counterparty, the type of acceptable

collateral that is monitored daily and adjusted to mitigate the

potential of any credit losses. Credit losses are not recognized

for secured financing receivables where the underlying

collateral’s fair value is equal to or exceeds the asset’s amortized

cost basis. In cases where the collateral’s fair value does not

equal or exceed the amortized cost basis, the allowance for

credit losses, if any, is limited to the difference between the fair

value of the collateral at the reporting date and the amortized

cost basis of the financial assets.

Broker Receivables. Our receivables from brokers, dealers, and

clearing organizations include deposits of cash with exchange

clearing organizations to meet margin requirements, amounts

due from clearing organizations for daily variation settlements,

securities failed-to-deliver or receive and receivables and

payables for fees and commissions. These receivables generally

do not give rise to material credit risk and have a remote

probability of default either because of their short-term nature or

due to the credit protection framework inherent in the design and

operations of brokers, dealers and clearing organizations. As

such, generally, no allowance for credit losses is held against

these receivables.

Investment Banking Fee Receivables. Our allowance for credit

losses on our investment banking fee receivables uses a

provisioning matrix based on the shared risk characteristics and

historical loss experience for such receivables. In some

instances, we may adjust the allowance calculated based on the

provision matrix to incorporate a specific allowance based on the

unique credit risk profile of a receivable. The provisioning matrix

is periodically updated to reflect changes in the underlying

portfolio’s credit characteristics and most recent historical loss

data.

Allowance for credit losses for investment banking receivables:

	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
$ in thousands	2025	2024	2025	2024
Beginning balance ...............	$2,315	$2,868	$5,277	$6,306
Bad debt expense ................	2,156	1,059	4,974	3,146
Charge-offs ...........................	—	(1)	(3,076)	(2,720)
Recoveries collected ...........	(1,274)	(197)	(3,978)	(3,003)
Ending balance (1) ..................	$3,197	$3,729	$3,197	$3,729

(1)Substantially all of the allowance for doubtful accounts relate to mergers and

acquisitions and restructuring fee receivables, which include recoverable

expense receivables.

Other Financial Assets. For all other financial assets measured at

amortized cost, we estimate expected credit losses over the

financial assets’ life as of the reporting date based on relevant

information about past events, current conditions, and

reasonable and supportable forecasts. During the nine months

ended August 31, 2024, we recognized bad debt expense of

$26.2 million related to receivables associated with our asset

management arrangements with Weiss Multi-Strategy Advisers.

Note 13. Goodwill and Intangible Assets

Goodwill

	Nine Months Ended August 31, 2025
$ in thousands	Investment<br><br>Banking and<br><br>Capital<br><br>Markets	Asset<br><br>Management	Total
Balance, at beginning of period ...................	$1,533,013	$294,925	$1,827,938
Currency translation and other<br><br>adjustments ..............................................	4,866	11,389	16,255
Measurement period adjustments (1) ........	—	1,802	1,802
Write-off related to disposals .......................	—	(5,563)	(5,563)
Balance, at end of period .............................	$1,537,879	$302,553	$1,840,432

(1)Relates to a measurement period adjustment recorded during the second

quarter of 2025 attributable to the Go Internet acquisition. Refer to Note 4,

Business Acquisitions for further discussion.

	Nine Months Ended August 31, 2024
$ in thousands	Investment<br><br>Banking and<br><br>Capital<br><br>Markets	Asset<br><br>Management	Total
Balance, at beginning of period ...................	$1,532,172	$315,684	$1,847,856
Currency translation and other<br><br>adjustments ..............................................	3,335	1,535	4,870
Measurement period adjustments (1) ........	—	(28,346)	(28,346)
Goodwill relating to acquisitions by<br><br>Tessellis .....................................................	—	8,578	8,578
Balance, at end of period .............................	$1,535,507	$297,451	$1,832,958

(1)Includes a $27.0 million measurement period adjustment recorded during the

first quarter of 2024 related to the OpNet acquisition. Refer to Note 4,

Business Acquisitions for further discussion.

34	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Carrying values of goodwill by reporting unit:

$ in millions	August 31,<br><br>2025	November 30,<br><br>2024
Investment banking ..............................................................	$702.9	$700.7
Equities and wealth management ......................................	256.2	255.4
Fixed income .........................................................................	578.7	576.9
Asset management ..............................................................	143.0	143.0
Other investments .................................................................	159.6	151.9
Total ........................................................................................	$1,840.4	$1,827.9

Goodwill Impairment Testing

The quantitative goodwill impairment test is performed at the

level of the reporting unit. A reporting unit is an operating

segment or one level below an operating segment. The fair value

of each reporting unit is compared with its carrying value,

including goodwill and allocated intangible assets. If the fair

value is in excess of the carrying value, the goodwill for the

reporting unit is considered not to be impaired. If the fair value is

less than the carrying value, then an impairment loss is

recognized for the amount by which the carrying value of the

reporting unit exceeds the reporting unit's fair value. Allocated

tangible equity plus allocated goodwill and intangible assets are

used for the carrying amount of each reporting unit.

We test goodwill allocated to our Investment Banking, Equities,

Fixed Income and Asset Management reporting units annually on

August 1 and test goodwill allocated to other individual

investments annually on November 30. Our annual goodwill

impairment testing at August 1, 2025 did not indicate any

goodwill impairment in any of our Investment Banking, Equities

and Fixed Income reporting units, which are part of our

Investment Banking and Capital Markets reportable segment and

did not indicate any goodwill impairment in our Asset

Management reporting unit. The results of our assessment

indicated that each of these reporting units had a fair value in

excess of their carrying amounts based on current projections.

Estimating the fair value of a reporting unit requires management

judgment. Estimated fair values for our reporting units were

determined using methodologies that include a market valuation

method that incorporated price-toearnings and price-to-book

multiples of comparable public companies and/or projected cash

flows. Under the market valuation approach, the key assumptions

are the selected multiples and our internally developed

projections of future profitability, growth and return on equity for

each reporting unit. The weight assigned to the multiples requires

judgment in qualitatively and quantitatively evaluating the size,

profitability and the nature of the business activities of the

reporting units as compared to the comparable publicly-traded

companies. In addition, as the fair values determined under the

market valuation approach represent a noncontrolling interest,

we applied a control premium to arrive at the estimated fair value

of each reporting unit on a controlling basis. We engaged an

independent valuation specialist to assist us in our valuation

process at August 1.

Intangible Assets

	August 31, 2025
$ in thousands	Gross<br><br>Cost	Assets<br><br>Acquired	Accumulated<br><br>Amortization	Net Carrying Amount
Customer relationships .......................	$166,958	$622	$(114,341)	53,239
Trademarks and trade names ............	161,280	—	(54,358)	106,922
Exchange and clearing organization<br><br>membership interests and<br><br>registrations ..........................................	8,781	—	—	8,781
Other ......................................................	87,469	99	(44,202)	43,366
Total .......................................................	$424,488	$721	$(212,901)	212,308

All values are in US Dollars.

	November 30, 2024
$ in thousands	Gross<br><br>Cost	Assets<br><br>Acquired<br><br>(1)	Impairment<br><br>Losses	Accumulated<br><br>Amortization	Net Carrying Amount
Customer relationships	$136,049	$26,450	$—	$(104,539)	57,960
Trademarks and trade<br><br>names ..............................	146,032	8,533	—	(45,412)	109,153
Exchange and clearing<br><br>organization<br><br>membership interests<br><br>and registrations ............	8,715	—	(10)	—	8,705
Other ................................	50,930	26,316	—	(26,693)	50,553
Total ................................	$341,726	$61,299	$(10)	$(176,644)	226,371

All values are in US Dollars.

(1)Includes a $39.3 million measurement period adjustment recorded during the

first quarter of 2024 related to the OpNet acquisition. Refer to Note 4,

Business Acquisitions for further information.

At August 1, 2025 we performed our annual impairment testing

of intangible assets with an indefinite useful life consisting of

exchange and clearing organization membership interests and

registrations. We utilized quantitative assessments of

membership interests and registrations that have available

quoted sales prices as well as certain other membership

interests and registrations that have declined in utilization and

qualitative assessments were performed on the remainder of our

indefinite-life intangible assets. With regard to our qualitative

assessments of the remaining indefinite life intangible assets,

based on our assessments of market conditions, the utilization of

the assets and the replacement costs associated with the assets,

we have concluded that it is not more likely than not that the

intangible assets are impaired.

Amortization Expense

For finite life intangible assets, we recognized aggregate

amortization expense of $8.6 million and $25.0 million for the

three and nine months ended August 31, 2025, respectively, and

$8.2 million and $22.3 million for the three and nine months

ended August 31, 2024, respectively. These expenses are

included in Depreciation and amortization.

Estimated future amortization expense for the next five fiscal

years (in thousands):

Remainder of fiscal year 2025 ................................................................	$12,953
Year ending November 30, 2026 ............................................................	33,652
Year ending November 30, 2027 ............................................................	29,988
Year ending November 30, 2028 ............................................................	28,672
Year ending November 30, 2029 ............................................................	16,280
August 2025 Form 10-Q	35
---	---

Notes to Consolidated Financial Statements

(Unaudited)

Note 14. Revenues from Contracts with Customers

	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
$ in thousands	2025	2024	2025	2024
Revenues from<br><br>contracts with<br><br>customers:
Investment banking ..........	$1,086,307	$925,635	$2,597,559	$2,343,284
Commissions and other<br><br>fees ....................................	319,784	270,643	951,933	787,968
Asset management fees .	8,236	7,189	61,539	43,539
Real estate revenues ........	16,621	4,038	43,913	10,727
Internet connection and<br><br>broadband revenues<br><br>(1) ..................................	56,598	61,268	171,069	183,537
Other contracts with<br><br>customers ..........................	16,616	15,140	49,515	43,890
Total revenue from<br><br>contracts with<br><br>customers ....................	1,504,162	1,283,913	3,875,528	3,412,945
Other sources of<br><br>revenue:
Principal transactions ......	486,893	324,501	1,232,630	1,381,432
Revenues from strategic<br><br>affiliates ........................	11,933	6,256	76,582	32,046
Interest ...............................	846,894	936,786	2,570,090	2,636,002
Other (1) .............................	57,792	44,133	120,023	201,402
Total revenues ..................	$2,907,674	$2,595,589	$7,874,853	$7,663,827

(1)There was an immaterial correction associated with classification of certain

revenue as revenue from contracts with customers, which resulted in

decreases of $61.3 million and $183.5 million in other revenue and increases

of $61.3 million and $183.5 million in internet connection and broadband

revenues for the three and nine months ended August 31, 2024, respectively.

Disaggregation of Revenue

	Three Months Ended August 31, 2025
$ in thousands	Investment<br><br>Banking and<br><br>Capital Markets	Asset<br><br>Management	Total
Major business activity:
Investment banking - Advisory ................	$655,578	$—	$655,578
Investment banking - Underwriting .........	430,730	—	430,730
Equities (1) .................................................	318,319	—	318,319
Fixed income (1) ........................................	1,464	—	1,464
Asset management ...................................	—	8,236	8,236
Other investments .....................................	—	89,835	89,835
Total ............................................................	$1,406,091	$98,071	$1,504,162
Primary geographic region:
Americas .....................................................	$1,038,469	$39,591	$1,078,060
Europe and the Middle East .....................	252,336	57,591	309,927
Asia-Pacific ................................................	115,286	889	116,175
Total ............................................................	$1,406,091	$98,071	$1,504,162			Three Months Ended August 31, 2024
---	---	---	---
$ in thousands	Investment<br><br>Banking and<br><br>Capital Markets	Asset<br><br>Management	Total
Major business activity:
Investment banking - Advisory ................	$592,462	$—	$592,462
Investment banking - Underwriting .........	333,173	—	333,173
Equities (1) .................................................	267,697	—	267,697
Fixed income (1) ........................................	2,486	—	2,486
Asset management ...................................	—	7,189	7,189
Other investments (2) ...............................	—	80,906	80,906
Total ............................................................	$1,195,818	$88,095	$1,283,913
Primary geographic region:
Americas .....................................................	$885,377	$24,858	$910,235
Europe and the Middle East (2) ...............	223,570	62,308	285,878
Asia-Pacific ................................................	86,871	929	87,800
Total ............................................................	$1,195,818	$88,095	$1,283,913			Nine Months Ended August 31, 2025
---	---	---	---
$ in thousands	Investment<br><br>Banking and<br><br>Capital Markets	Asset<br><br>Management	Total
Major business activity:
Investment banking - Advisory ................	$1,511,218	$—	$1,511,218
Investment banking - Underwriting .........	1,086,341	—	1,086,341
Equities (1) .................................................	946,549	—	946,549
Fixed income (1) ........................................	5,384	—	5,384
Asset management ...................................	—	61,539	61,539
Other investments .....................................	—	264,497	264,497
Total ............................................................	$3,549,492	$326,036	$3,875,528
Primary geographic region:
Americas .....................................................	$2,575,418	$149,184	$2,724,602
Europe and the Middle East .....................	663,986	174,079	838,065
Asia-Pacific ................................................	310,088	2,773	312,861
Total ............................................................	$3,549,492	$326,036	$3,875,528			Nine Months Ended August 31, 2024
---	---	---	---
$ in thousands	Investment<br><br>Banking and<br><br>Capital Markets	Asset<br><br>Management	Total
Major business activity:
Investment banking - Advisory ................	$1,214,927	$—	$1,214,927
Investment banking - Underwriting .........	1,128,356	—	1,128,356
Equities (1) .................................................	779,462	—	779,462
Fixed income (1) ........................................	7,036	—	7,036
Asset management ...................................	—	43,539	43,539
Other investments (2) ...............................	—	239,625	239,625
Total ............................................................	$3,129,781	$283,164	$3,412,945
Primary geographic region:
Americas .....................................................	$2,351,130	$93,626	$2,444,756
Europe and the Middle East (2) ...............	518,916	186,729	705,645
Asia-Pacific ................................................	259,735	2,809	262,544
Total ............................................................	$3,129,781	$283,164	$3,412,945

(1)Revenues from contracts with customers associated with the equities and

fixed income businesses primarily represent commissions and other fee

revenue.

(2)There was an immaterial correction associated with classification of certain

revenue as revenue from contracts with customers, which resulted in

increases of $61.3 million and $183.5 million in Other Investments within

major business activities and increases of $61.3 million and $183.5 million in

Europe and the Middle East under primary geographic regions for the three

and nine months ended August 31, 2024, respectively.

36	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Information on Remaining Performance Obligations and Revenue

Recognized from Past Performance

We do not disclose information about remaining performance

obligations pertaining to contracts that have an original expected

duration of one year or less. The transaction price allocated to

remaining unsatisfied or partially unsatisfied performance

obligations with an original expected duration exceeding one year

was not material at August 31, 2025. Investment banking

advisory fees that are contingent upon completion of a specific

milestone and fees associated with certain distribution services

are also excluded as the fees are considered variable and not

included in the transaction price.

During the three and nine months ended August 31, 2025, we

recognized $36.1 million and $83.8 million, respectively,

compared with $39.2 million and $39.7 million during the three

and nine months ended August 31, 2024, respectively, of revenue

related to performance obligations satisfied (or partially

satisfied) in previous periods, mainly due to resolving

uncertainties in variable consideration that was constrained in

prior periods. In addition, three and nine months ended August

31, 2025, we recognized $8.5 million and $24.0 million,

respectively, compared with $8.6 million and $23.8 million during

the three and nine months ended August 31, 2024, respectively,

of revenues primarily associated with distribution services, a

portion of which relates to prior periods.

Contract Balances

The timing of our revenue recognition may differ from the timing

of payment by our customers. We record a receivable when

revenue is recognized prior to payment and we have an

unconditional right to payment. Alternatively, when payment

precedes the provision of the related services, we record deferred

revenue until the performance obligations are satisfied.

Our deferred revenue primarily relates to retainer and milestone

fees received in investment banking advisory engagements

where the performance obligation has not yet been satisfied.

Deferred revenue at August 31, 2025 and November 30, 2024

was $84.8 million and $79.1 million, respectively, which is

recorded in Accrued expenses and other liabilities. During the

three and nine months ended August 31, 2025, we recognized

revenues of $44.8 million and $52.8 million, respectively,

compared with $35.0 million and $33.2 million for the three and

nine months ended August 31, 2024, respectively, that were

recorded as deferred revenue at the beginning of the periods.

We had receivables related to revenues from contracts with

customers of $324.4 million and $275.9 million at August 31,

2025 and November 30, 2024, respectively.

Contract Costs

We capitalize costs to fulfill contracts associated with

investment banking advisory engagements where the revenue is

recognized at a point in time and the costs are determined to be

recoverable. Capitalized costs to fulfill a contract are recognized

at the point in time that the related revenue is recognized.

At August 31, 2025 and November 30, 2024, capitalized costs to

fulfill a contract were $7.7 million and $5.8 million, respectively,

which are recorded in Receivables – Fees, interest and other.

During the three and nine months ended August 31, 2025, we

recognized expenses of $1.3 million and $1.9 million, compared

with $1.2 million and $1.9 million during the three and nine

months ended August 31, 2024, related to costs to fulfill a

contract that were capitalized as of the beginning of the period.

There were no significant impairment charges recognized in

relation to these capitalized costs during the three and nine

months ended August 31, 2025 and August 31, 2024.

Note 15. Compensation Plans

For a description of Restricted Stock, Restricted Stock Units, the

Senior Executive Compensation Plan and other compensation

plans refer to Note 15. Compensation Plans in our consolidated

financial statements included in Part II, Item 8 of our Annual

Report on Form 10-K for the year ended November 30, 2024.

At August 31, 2025, there were approximately 2.2 million shares

of restricted stock outstanding with future service required,

4.5 million RSUs outstanding with future service required

(including target RSUs that may be issued under the senior

executive compensation plan), 9.7 million RSUs outstanding with

no future service required, and 5.1 million stock options

outstanding. The maximum potential increase to common shares

outstanding resulting from these outstanding awards is

19.3 million at August 31, 2025.

In December 2024, the Compensation Committee of our Board of

Directors granted RSUs and performance stock units (“PSUs”) to

each of our senior executives as follows:

$ in millions	Grant Terms
RSUs
Aggregate grant date fair value ......................................	$18.0
Vesting period ...................................................................	3-year cliff
PSUs
Aggregate target fair value ..............................................	$18.0
Service period ....................................................................	3 years
Performance period ..........................................................	Fiscal 2024 to Fiscal 2026
Performance target (1) ....................................................	10% ROTE
Performance range (2) .....................................................	7.5% - 15% ROTE

(1)ROTE is defined as return on tangible equity measured over three years.

(2)Performance below an ROTE of 7.5% results in forfeiture of all PSUs. An ROTE

of 15% or greater results in earning 150% of target PSUs and between 7.5% to

15%, the level of earning PSUs is linearly interpolated.

In addition, we sponsor non-share-based compensation plans.

Non-share-based compensation plans sponsored by us include a

profit sharing plan and other forms of restricted cash awards.

Restricted cash awards are subject to ratable vesting terms with

service requirements. These awards are amortized as

compensation expense over the relevant service period, which is

generally considered to start at the beginning of the annual

compensation year.

August 2025 Form 10-Q	37

Notes to Consolidated Financial Statements

(Unaudited)

Components of total compensation cost associated with certain

of our compensation plans:

	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
$ in millions	2025	2024	2025	2024
Restricted cash awards	$126.3	$103.7	$372.9	$315.8
Restricted stock and<br><br>RSUs (1) .....................	14.0	13.4	67.8	47.9
Profit sharing plan .........	2.2	2.1	11.4	11.2
Total compensation<br><br>cost .............................	$142.5	$119.2	$452.1	$374.9

(1)Total compensation cost associated with restricted stock and RSUs includes

the amortization of sign-on, retention and senior executive awards, less

forfeitures and clawbacks.

Remaining unamortized amounts related to certain

compensation plans at August 31, 2025:

$ in millions	Remaining Unamortized Amounts
Non-vested share-based awards ..............	112.3
Restricted cash awards (1) ........................	977.4
Total ..............................................................	1,089.7

All values are in US Dollars.

(1)The remaining unamortized amount is included within Other assets.

Note 16. Borrowings

Short-Term Borrowings

$ in thousands	August 31,<br><br>2025	November 30,<br><br>2024
Bank loans and other credit facilities ........................	$532,232	$443,160
Fixed rate callable note ...............................................	699,096	—
Total short-term borrowings (1) ...............................	$1,231,328	$443,160

(1)Short-term borrowings mature in one year or less and are recorded at cost,

which is a reasonable approximation of their fair values due to their liquid and

short-term nature.

At August 31, 2025 and November 30, 2024, the weighted

average interest rate on bank loans outstanding is 5.18% and

6.25% per annum, respectively.

Our borrowings include credit facilities that contain certain

covenants that, among other things, require us to maintain a

specified level of tangible net worth, require a minimum

regulatory net capital requirement for our U.S. broker-dealer,

Jefferies LLC, and impose certain restrictions on the future

indebtedness of certain of our subsidiaries that are borrowers.

Interest is based on rates at spreads over the federal funds rate

or other adjusted rates, as defined in the various credit

agreements, or at a rate as agreed between the bank and us in

reference to the bank’s cost of funding. At August 31, 2025, we

were in compliance with all covenants under these credit

facilities.

38	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Long-Term Debt

$ in thousands	Maturity (Fiscal Years)	August 31, 2025	November 30, 2024
Parent Co. unsecured borrowings
Fixed rate	2025	$—	$519,738
	2026	1,330,604	818,819
	2027	1,144,352	587,631
	2028	1,099,206	1,031,076
	2029	643,614	742,427
	2030 and Later	5,804,542	4,561,814
Variable rate	2026	45,608	41,230
	2027	350,000	570,432
	2029	1,312	1,311
	2030 and Later	71,920	850,273
Structured notes (1)	2025	59,372	157,638
	2026	128,932	114,308
	2027	99,231	97,758
	2028	168,411	77,781
	2029	203,443	316,139
	2030 and Later	2,317,735	1,587,721
Total Parent Co. unsecured borrowings (2) ..........................................................................................................................................		13,468,282	12,076,096
Subsidiaries secured borrowings
Fixed rate (3)	2025	159,099	160,384
	2026	26,255	42,643
	2027	625,215	13,077
	2028	714,562	35,135
	2029	161,710	104,912
Variable rate	2026	525,000	792,400
	2027	274,356	274,026
Total Subsidiaries secured borrowings .................................................................................................................................................		2,486,197	1,422,577
Subsidiaries unsecured borrowings
Fixed rate	2029	4,048	4,310
	2030 and Later	1,542	1,347
Variable rate	2026	—	26,235
	2027	53,565	—
Total Subsidiaries unsecured borrowings .............................................................................................................................................		59,155	31,892
Total long-term debt (4) ..........................................................................................................................................................................		$16,013,634	$13,530,565
Fair value ....................................................................................................................................................................................................		$16,220,465	$13,734,421
Weighted-average interest rate (5) .......................................................................................................................................................		5.47%	5.30%
Interest rate range (5) ..............................................................................................................................................................................		0.00% - 7.52%	0.00% - 7.66%

(1)Structured notes have various interest rate payment terms and are accounted for at fair value, with changes in fair value resulting from non-credit components

recognized in Principal transactions revenues. The structured notes are classified as Level 2 or Level 3 in the fair value hierarchy. All of our long-term debt with exception

of certain of the structured notes would be classified as Level 2 in the fair value hierarchy.

(2)Carrying values of certain borrowings, totaling $2.67 billion and $2.04 billion for August 31, 2025 and November 30, 2024, respectively, include cumulative hedging

adjustments of $153.5 million and $193.7 million at August 31, 2025 and November 30, 2024, respectively, associated with interest rate swaps based on designation as

fair value hedges. Refer to Note 7, Derivative Financial Instruments for further information.

(3)Includes $65.5 million maturing on August 31, 2025 which has subsequently been extended.

(4)Carrying values include unamortized discounts and premiums, valuation adjustments and debt issuance costs. At August 31, 2025 and November 30, 2024, our

borrowings under several credit facilities classified within Long-term debt amounted to $1.20 billion and $775.3 million, respectively. Interest on these credit facilities is

based on an adjusted Secured Overnight Financing Rate (“SOFR”) plus a spread or other adjusted rates, as defined in the various credit agreements. Additionally, certain

of our borrowings are under agreements containing covenants that, among other things, require us to maintain specified levels of tangible net worth and liquidity

amounts, certain credit and rating levels and impose certain restrictions on future indebtedness of and require specified levels of regulated capital and cash reserves for

certain of our subsidiaries. At August 31, 2025, we were in compliance with all covenants under theses credit agreements.

(5)Interest rates exclude structured notes.

August 2025 Form 10-Q	39

Notes to Consolidated Financial Statements

(Unaudited)

During the nine months ended August 31, 2025, long-term debt

increased by $2.48 billion to $16.01 billion at August 31, 2025

primarily due to proceeds of $350.0 million from the drawdown

of an unsecured credit facility, $1.00 billion from the issuances of

unsecured senior notes, $527.2 million from net issuances of

structured notes, $1.01 billion from increased subsidiaries

borrowings and $326.4 million from currency losses on foreign

currency borrowings. These increases were partially offset by

repayments of $775.4 million on unsecured senior notes.

Note 17. Total Equity

Common Stock

At August 31, 2025 and November 30, 2024, we had 565,000,000

authorized shares of voting common stock with a par value of

$1.00 per share. At August 31, 2025 and November 30, 2024, we

had outstanding 206,280,296 and 205,504,272 common shares

outstanding, respectively.

The Board of Directors has authorized the repurchase of

common stock up to $250.0 million under a share repurchase

program. Treasury stock repurchases during the three and nine

months ended August 31, 2025 represent repurchases of

common stock for net-share tax withholding under our equity

compensation plan.

Non-Voting Convertible Preferred Shares

On April 27, 2023, we established Series B Non-Voting

Convertible Preferred Shares with a par value of $1.00 per share

(“Series B Preferred Stock”) and designated 70,000 shares as

Series B Preferred Stock. The Series B Preferred Stock has a

liquidation preference of $17,500 per share and rank senior to our

voting common stock upon dissolution, liquidation or winding up

of Jefferies Financial Group Inc. Each share of Series B Preferred

Stock is automatically convertible into 500 shares of non-voting

common stock, subject to certain anti-dilution adjustments, three

years after issuance. The Series B Preferred Stock participates in

cash dividends and distributions alongside our voting common

stock on an as-converted basis.

Additionally, on April 27, 2023, we entered into an Exchange

Agreement with Sumitomo Mitsui Banking Corporation (“SMBC”),

which entitles SMBC to exchange shares of our voting common

stock for shares of the Series B Preferred Stock at a rate of 500

shares of voting common stock for one share of Series B

Preferred Stock. The Exchange Agreement is limited to 55,125

shares of Preferred Stock and SMBC will pay $1.50 per share of

voting common stock so exchanged. As of November 30, 2024,

SMBC had cumulatively exchanged approximately 27.6 million

shares of voting common stock for 55,125 shares of Series B

Preferred Stock. Following this exchange, SMBC increased its

ownership of our common stock on an as-converted basis and

fully-diluted, as-converted basis. As a result, the CEO of

Sumitomo Mitsui Financial Group, Inc. was elected and now

serves on our Board of Directors. On September 19, 2024, SMBC

purchased 9.2 million shares of our common stock. At August 31,

2025, SMBC owns approximately 15.7% of our common stock on

an as-converted basis and 14.5% on a fully-diluted, as-converted

basis. Refer to Note 22, Related Party Transactions for further

information regarding transactions with SMBC.

On September 19, 2025, our Board of Directors established Series

B-1 Non-Voting Convertible Preferred Shares with a par value of

$1.00 per share (“Series B-1 Preferred Stock”) and designated

17,500 shares as Series B-1 Preferred Stock. The Series B-1

Preferred Stock has a liquidation preference of $500 per share

and ranks senior to our voting common stock and equal to the

Series B Preferred Stock upon dissolution, liquidation or winding

up of Jefferies Financial Group Inc. Each share of Series B-1

Preferred Stock is automatically convertible into 500 shares of

non-voting common stock as soon as such non-voting common

stock exists, subject to certain anti-dilution adjustments. The

Series B-1 Preferred Stock also participates in cash dividends

and distributions alongside our voting common stock on an as-

converted basis.

Additionally, on September 19, 2025, we entered into an amended

and restated Exchange Agreement (the “Amended and Restated

Exchange Agreement”) with SMBC, which entitles SMBC to

exchange shares of our voting common stock for shares of the

Series B-1 Preferred Stock at a rate of 500 shares of voting

common stock for one share of Series B-1 Preferred Stock. The

Amended and Restated Exchange Agreement is limited to 17,500

shares of Series B-1 Preferred Stock. Under the Amended and

Restated Exchange Agreement, SMBC is permitted to increase its

economic ownership in the Company to up to 20% on an as-

converted and fully diluted basis, while continuing to own less

than 5% of a voting interest in the Company.

40	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Earnings Per Common Share

Basic and diluted earnings per common share amounts were calculated by dividing net earnings by the weighted-average number of

common shares outstanding. The numerators and denominators used to calculate basic and diluted earnings per common share are as

follows:

	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
In thousands, except per share amounts	2025	2024	2025	2024
Numerator for earnings per common share from continuing operations:
Net earnings from continuing operations ...........................................................................................	$242,504	$174,676	$470,748	$493,606
Less: Net losses attributable to noncontrolling interests .................................................................	(10,041)	(6,304)	(24,692)	(16,541)
Allocation of earnings to participating securities (1) ........................................................................	(28,559)	(20,785)	(55,528)	(48,501)
Net earnings from continuing operations attributable to common shareholders for basic<br><br>earnings per share .............................................................................................................................	$223,986	$160,195	$439,912	$461,646
Net earnings from continuing operations attributable to common shareholders for diluted<br><br>earnings per share .............................................................................................................................	$223,986	$160,195	$439,912	$461,646
Numerator for earnings per common share from discontinued operations:
Net earnings (losses) from discontinued operations, net of taxes .................................................	—	6,363	—	(1,488)
Less: Net losses attributable to noncontrolling interests .................................................................	—	(570)	—	(2,561)
Net earnings (losses) from discontinued operations attributable to common shareholders<br><br>for basic and diluted earnings per share .......................................................................................	$—	$6,933	$—	$1,073
Net earnings attributable to common shareholders for basic earnings per share .....................	$223,986	$167,128	$439,912	$462,719
Net earnings attributable to common shareholders for diluted earnings per share ..................	$223,986	$167,128	$439,912	$462,719
Denominator for earnings per common share:
Weighted average common shares outstanding ...............................................................................	206,272	206,418	206,191	209,997
Weighted average shares of restricted stock outstanding with future service required .............	(2,224)	(2,305)	(2,259)	(2,346)
Weighted average RSUs outstanding with no future service required ............................................	11,245	10,339	11,045	10,455
Weighted average basic common shares ..........................................................................................	215,293	214,452	214,977	218,106
Stock options and other share-based awards ...................................................................................	4,643	4,189	4,915	3,369
Senior executive compensation plan RSU awards ............................................................................	2,779	3,058	2,647	2,705
Weighted average diluted common shares (2) .................................................................................	222,715	221,699	222,539	224,180
Earnings per common share:
Basic from continuing operations ........................................................................................................	$1.04	$0.75	$2.05	$2.12
Basic from discontinued operations ....................................................................................................	—	0.03	—	—
Basic .........................................................................................................................................................	$1.04	$0.78	$2.05	$2.12
Diluted from continuing operations ......................................................................................................	$1.01	$0.72	$1.98	$2.06
Diluted from discontinued operations ..................................................................................................	—	0.03	—	—
Diluted ......................................................................................................................................................	$1.01	$0.75	$1.98	$2.06

(1)Represents dividends declared during the period on participating securities plus an allocation of undistributed earnings to participating securities.

Net losses are not allocated to participating securities. Participating securities represent certain preferred stock, restricted stock and RSUs for

which requisite service has not yet been rendered and amounted to weighted average shares of 27.6 million for both the three and nine months

ended August 31, 2025, respectively, compared with 26.3 million and 22.9 million for the three and nine months ended August 31, 2024,

respectively. Undistributed earnings are allocated to participating securities based upon their right to share in earnings if all earnings for the period

had been distributed.

(2)Certain securities have been excluded as they would be antidilutive. However, these securities could potentially dilute earnings per share in the

future. Antidilutive shares at August 31, 2025 and was 13.4% of the weighted average common shares outstanding for both the three and nine

months ended August 31, 2025.

August 2025 Form 10-Q	41

Notes to Consolidated Financial Statements

(Unaudited)

Dividends

Nine Months Ended August 31, 2025
Declaration Date	Record Date	Payment Date	Per Common<br><br>Share Amount
January 8, 2025	February 14, 2025	February 27, 2025	$0.40
March 26, 2025	May 19, 2025	May 29, 2025	$0.40
June 25, 2025	August 18, 2025	August 29, 2025	$0.40
Nine Months Ended August 31, 2024
Declaration Date	Record Date	Payment Date	Per Common<br><br>Share Amount
January 8, 2024	February 16, 2024	February 27, 2024	$0.30
March 27, 2024	May 20, 2024	May 30, 2024	$0.30
June 26, 2024	August 19, 2024	August 30, 2024	$0.35

On January 8, 2025, the Board of Directors increased our

quarterly dividend from $0.35 to $0.40 per common share. On

September 29, 2025, the Board of Directors declared a dividend

of $0.40 per common share to be paid on November 26, 2025 to

common shareholders of record at November 17, 2025.

During the three and nine months ended August 31, 2025, we

paid cash dividends of $11.0 million and $33.1 million, compared

to $9.6 million and $22.2 million for the three and nine months

ended August 31, 2024, respectively, to the Series B Preferred

stockholder. The payment of dividends is subject to the

discretion of our Board of Directors and depends upon general

business conditions and other factors that our Board of Directors

may deem to be relevant.

Accumulated Other Comprehensive Income (Loss)

$ in thousands	August 31,<br><br>2025	November 30,<br><br>2024
Net unrealized losses on available-for-sale<br><br>securities .......................................................................	$(2,145)	$(2,406)
Net currency translation adjustments and other .....	(134,748)	(173,841)
Net unrealized losses related to instrument-<br><br>specific credit risk .......................................................	(198,719)	(206,664)
Net minimum pension liability ....................................	(39,315)	(40,220)
Total accumulated other comprehensive loss, net<br><br>of tax ..............................................................................	$(374,927)	$(423,131)

Amounts reclassified out of accumulated other comprehensive

income (loss) to net earnings:

	Three Months<br><br>Ended<br><br>August 31,		Nine Months<br><br>Ended<br><br>August 31,
$ in thousands	2025	2024	2025	2024
Net unrealized gains on instrument-<br><br>specific credit risk at fair value (1) ............	$2,304	$150	$9,962	$2,783
Amortization of defined benefit pension<br><br>plan actuarial losses (2) ..............................	(124)	(67)	(950)	(247)
Total reclassifications for the period,<br><br>net of tax .......................................................	$2,180	$83	$9,012	$2,536

(1)The amounts include income tax expense of $0.8 million and $3.4 million for

the three and nine months ended August 31, 2025, respectively, compared

with income tax expense of $0.1 million and $1.0 million for the three and nine

months ended August 31, 2024, respectively, which were reclassified to

Principal transactions revenues.

(2)The amounts include income tax benefit of $0.3 million for nine months ended

August 31, 2025, compared with an income tax benefit of $0.1 million for the

nine months ended August 31, 2024, which were reclassified to Compensation

and benefits expenses.

Note 18. Income Taxes

At August 31, 2025 and November 30, 2024, our total gross

unrecognized tax benefits were $324.1 million and

$346.4 million, respectively.

At August 31, 2025 and November 30, 2024, we had interest

accrued of $186.8 million and $176.6 million, respectively,

included in Accrued expenses and other liabilities.

The total amount of unrecognized tax benefits that, if recognized,

would favorably affect the effective tax rate was $256.1 million

and $273.8 million (net of Federal benefit) at August 31, 2025

and November 30, 2024, respectively.

We recognize interest and penalties, if any, related to

unrecognized tax benefits in income tax expense.

We are currently under examination by a number of taxing

jurisdictions. Though we do not expect that resolution of these

examinations will have a material effect on our consolidated

financial position, they may have a material impact on our

consolidated results of operations for the period in which

resolution occurs.

Earliest tax years that remain subject to examination in the major

tax jurisdictions in which we operate:

Jurisdiction	Tax Year
United States ...........................................................................................	2021
New York State ........................................................................................	2001
New York City ..........................................................................................	2006
United Kingdom .......................................................................................	2022
Germany ...................................................................................................	2019
Hong Kong ...............................................................................................	2019
India ...........................................................................................................	2010			Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
---	---	---	---	---
$ in millions	2025	2024	2025	2024
Income tax expense ..............	$89.3	$78.0	$147.0	$207.1
Effective tax rate ....................	26.9%	30.9%	23.8%	29.6%

Note 19. Commitments, Contingencies and Guarantees

Commitments

	Expected Maturity Date (Fiscal Years)
$ in millions	2025	2026	2027<br><br>and<br><br>2028	2029<br><br>and<br><br>2030	2031<br><br>and<br><br>Later	Maximum<br><br>Payout
Equity commitments (1) .....	$19.5	$26.7	$100.2	$0.1	$151.5	$298.0
Loan commitments (1) .......	1.9	340.5	9.0	3.3	4.3	359.0
Loan purchase<br><br>commitments (2) .................	2,870.0	—	—	—	—	2,870.0
Forward starting reverse<br><br>repos (3) ...............................	3,834.4	—	—	—	—	3,834.4
Forward starting repos (3) .	2,312.5	—	—	—	—	2,312.5
Other unfunded<br><br>commitments (1) .................	70.4	1,397.8	1,217.7	8.9	16.5	2,711.3
Total commitments ............	$9,108.7	$1,765.0	$1,326.9	$12.3	$172.3	$12,385.2

(1)Equity, loan and other unfunded commitments are presented by contractual

maturity date. The amounts, however, are available on demand.

(2)Loan purchase commitments consist of unfunded commitments to acquire

secondary market loans. For the population of loans to be acquired under the

loan purchase commitments, at August 31, 2025, Jefferies had also entered

into back-to-back committed sale contracts aggregating to $2.73 billion.

(3)At August 31, 2025, all of the of the forward starting securities purchased

under agreements to resell and all of the forward starting securities sold under

agreements to repurchase settled within three business days.

42	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Equity Commitments. Includes commitments to invest in our joint

venture, Jefferies Finance, asset management funds and in

Jefferies Capital Partners, LLC, a manager of private equity funds,

which consists of a team led by our President and a director. At

August 31, 2025, our outstanding commitments relating to

Jefferies Capital Partners, LLC and its private equity funds were

$9.8 million.

Additionally, at August 31, 2025, we had other outstanding equity

commitments to invest up to $232.1 million with strategic

affiliates and $40.7 million to various other investments.

Loan Commitments. From time to time, we make commitments

to extend credit to clients and to strategic affiliates. These

commitments and any related drawdowns of these facilities

typically have fixed maturity dates and are contingent on certain

representations, warranties and contractual conditions applicable

to the borrower. At August 31, 2025, we had outstanding loan

commitments of $99.4 million to clients and $9.6 million to a

strategic affiliate.

Loan commitments outstanding at August 31, 2025 also include

our portion of the outstanding secured revolving credit facility

provided to Jefferies Finance, to support loan underwritings by

Jefferies Finance.

Underwriting Commitments. In connection with investment

banking activities, we may from time to time provide underwriting

commitments to our clients in connection with capital raising

transactions.

Forward Starting Reverse Repos and Repos. We enter into

commitments to take possession of securities with agreements

to resell on a forward starting basis and to sell securities with

agreements to repurchase on a forward starting basis that are

primarily secured by U.S. government and agency securities.

Other Unfunded Commitments. Other unfunded commitments

include obligations in the form of revolving notes, warehouse

financings and debt securities to provide financing to asset-

backed and CLO vehicles. Upon advancing funds, drawn amounts

are collateralized by the assets of an entity. Other unfunded

commitments also include written put options to certain

bondholders of an equity method investee.

Guarantees

Derivative Contracts. As a dealer, we make markets and trade in a

variety of derivative instruments. Certain derivative contracts that

we have entered into meet the accounting definition of a

guarantee under U.S. GAAP, including credit default swaps,

written foreign currency options and written equity put options.

On certain of these contracts, such as written interest rate caps

and foreign currency options, the maximum payout cannot be

quantified since the increase in interest or foreign exchange rates

are not contractually limited by the terms of the contract. As

such, we have disclosed notional values as a measure of our

maximum potential payout under these contracts.

Notional amounts associated with our derivative contracts

meeting the definition of a guarantee under U.S. GAAP at

August 31, 2025:

	Expected Maturity Date (Fiscal Years)
$ in millions	2025	2026	2027 and<br><br>2028	2029 and<br><br>2030	Notional/<br><br>Maximum<br><br>Payout
Guarantee Type:
Derivative contracts—<br><br>non-credit related .........	$8,100.5	$17,983.3	$18,839.6	$1,615.0	$46,538.4
Total derivative contracts .......	$8,100.5	$17,983.3	$18,839.6	$1,615.0	$46,538.4

The derivative contracts deemed to meet the definition of a

guarantee under U.S. GAAP are before consideration of hedging

transactions and only reflect a partial or “one-sided” component

of any risk exposure. Written equity options and written credit

default swaps are often executed in a strategy that is in tandem

with long cash instruments (e.g., equity and debt securities). We

substantially mitigate our exposure to market risk on these

contracts through hedges, such as other derivative contracts

and/or cash instruments, and we manage the risk associated

with these contracts in the context of our overall risk

management framework. We believe notional amounts overstate

our expected payout and that fair value of these contracts is a

more relevant measure of our obligations. At August 31, 2025,

the fair value of derivative contracts meeting the definition of a

guarantee is approximately $382.4 million.

HomeFed. For real estate development projects, we are generally

required to obtain infrastructure improvement bonds at the

beginning of construction work and warranty bonds upon

completion of such improvements. These bonds are issued by

surety companies to guarantee a municipality satisfactory

completion of a project. As the planned area is developed and the

municipality accepts the improvements, the bonds are released.

At August 31, 2025, the aggregate amount of infrastructure

improvement bonds outstanding was $68.2 million.

Standby Letters of Credit. At August 31, 2025, we provided

guarantees to certain counterparties in the form of standby

letters of credit in the amount of $345.6 million, with a weighted

average maturity of less than one year. Standby letters of credit

commit us to make payment to the beneficiary if the guaranteed

party fails to fulfill its obligation under a contractual arrangement

with that beneficiary. Since commitments associated with these

collateral instruments may expire unused, the amount shown

does not necessarily reflect the actual future cash funding

requirement.

August 2025 Form 10-Q	43

Notes to Consolidated Financial Statements

(Unaudited)

Other Guarantees. We are members of various exchanges and

clearing houses. In the normal course of business, we provide

guarantees to securities clearing houses and exchanges. These

guarantees generally are required under the standard

membership agreements, such that members are required to

guarantee the performance of other members. Additionally, if a

member becomes unable to satisfy its obligations to the clearing

house, other members would be required to meet these

shortfalls. To mitigate these performance risks, the exchanges

and clearing houses often require members to post collateral.

Our obligations under such guarantees could exceed the

collateral amounts posted. Our maximum potential liability under

these arrangements cannot be quantified; however, the potential

for us to be required to make payments under such guarantees is

deemed remote. Accordingly, no liability has been recognized for

these arrangements. Additionally, we provide certain

indemnifications in connection with third-party clearing and

execution arrangements whereby a third-party may clear and

settle transactions on behalf of our clients. These

indemnifications generally have standard contractual terms and

are entered into in the ordinary course of business. Our

obligations in respect of such transactions are secured by the

assets in our client’s account, as well as any proceeds received

from the transactions cleared and settled on behalf of our client.

However, we believe that it is unlikely we would have to make any

material payments under these arrangements and no material

liabilities related to these indemnifications have been recognized.

Note 20. Regulatory Requirements

Net Capital

Jefferies LLC is a broker-dealer registered with the SEC and a

member firm of the Financial Industry Regulatory Authority

(“FINRA”) and is subject to the SEC Uniform Net Capital Rule

(“Rule 15c3-1”), which requires the maintenance of minimum net

capital, and has elected to calculate minimum capital

requirements using the alternative method permitted by Rule

15c3-1 in calculating net capital. Jefferies LLC, as a dually-

registered U.S. broker-dealer and futures commission merchant

(“FCM”), is also subject to Regulation 1.17 of the Commodity

Futures Trading Commission (“CFTC”) under the Commodity

Exchange Act (“CEA”), which sets forth minimum financial

requirements. The minimum net capital requirement in

determining excess net capital for a dually registered U.S. broker-

dealer and FCM is equal to the greater of the requirement under

SEA Rule 15c3-1 or CFTC Regulation 1.17. Accordingly, FINRA is

the designated examining authority for Jefferies LLC and the

National Futures Association (“NFA”) is the designated self-

regulatory organization (“DSRO”) for Jefferies LLC as an FCM.

Jefferies Financial Services, Inc. (“JFSI”) is registered with the

SEC as a Security-Based Swap Dealer (“SBS Dealer”) and an OTC

Derivatives Dealer (“OTCDD”) subject to the SEC’s SBS dealer

regulatory rules and the SEC’s net capital requirements pursuant

to Rule 18a-1. JFSI is also registered as a swap dealer with the

CFTC and is subject to the CFTC’s regulatory capital

requirements pursuant to the minimum financial requirements for

swap dealers under CFTC Regulation 23.101. Additionally, as a

registered member firm, JFSI is subject to the net capital

requirements of the NFA. Accordingly, the SEC is the designated

examining authority for JFSI in its capacity as an SBS Dealer and

OTCDD, while the NFA is the DSRO for JFSI, as a CFTC registered

swap dealer.

Certain non-U.S. subsidiaries are subject to capital adequacy

requirements as prescribed by the regulatory authorities in their

respective jurisdictions. This includes Jefferies International

Limited which is subject to the regulatory supervision and

requirements of the Financial Conduct Authority (“FCA”) in the

U.K. Jefferies International Limited’s’ own funds requirement

represents the highest of the permanent minimum capital

requirement, fixed overheads requirement and k-factor

requirements set out in the Investment Firms Prudential Regime

(“IFPR”) under the FCA’s MIFIDPRU sourcebook.

At August 31, 2025, Jefferies LLC’s and JFSI’s net capital and

excess net capital were as follows:

$ in thousands	Net<br><br>Capital	Excess Net<br><br>Capital
Jefferies LLC .................................................................	$2,204,515	$2,061,318
JFSI - SEC ......................................................................	310,701	290,345
JFSI - CFTC ...................................................................	310,701	283,646

In addition, the equivalent capital requirement for Jefferies

International Limited, on a consolidated basis, is a total capital of

$2.02 billion and an excess capital of $1.15 billion at August 31,

2025.

At August 31, 2025, Jefferies LLC, JFSI and JIL are in compliance

with their applicable requirements.

The regulatory capital requirements referred to above may

restrict our ability to withdraw capital from our regulated

subsidiaries.

Customer Protection and Segregation Requirement

As a registered broker dealer that clears and carries customer

accounts, Jefferies LLC is subject to the customer protection

provisions under SEC Rule 15c3-3 and is required to compute a

reserve formula requirement for customer accounts and deposit

cash or qualified securities into a special reserve bank account

for the exclusive benefit of customers. At August 31, 2025,

Jefferies LLC had $875.6 million in cash and qualified U.S.

Government securities on deposit in special reserve bank

accounts for the exclusive benefit of customers.

As a registered broker dealer that clears and carries proprietary

accounts of brokers or dealers (commonly referred to as “PAB”),

Jefferies LLC is also required to compute a reserve requirement

for PABs pursuant to SEC Rule 15c3-3. At August 31, 2025,

Jefferies LLC had $437.8 million in cash and qualified U.S.

Government securities in special reserve bank accounts for the

exclusive benefit of PABs.

The qualified securities meeting the 15c3-3 customer and PAB

requirements are included in Cash and securities segregated and

Securities purchased under agreements to resell.

44	Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

(Unaudited)

Note 21. Segment Reporting

We operate in two reportable business segments: (1) Investment

Banking and Capital Markets and (2) Asset Management. The

Investment Banking and Capital Markets reportable business

segment includes our capital markets activities and our

investment banking business, which provides underwriting and

financial advisory services to our clients. We operate in the

Americas; Europe and the Middle East; and Asia-Pacific.

Investment Banking and Capital Markets also includes our

corporate lending joint venture Jefferies Finance, our commercial

real estate joint venture Berkadia and historically our automobile

lending and servicing activities. The Asset Management

reportable business segment provides alternative investment

management services to investors in the U.S. and overseas and

generates investment income from capital invested in and

managed by us or our affiliated asset managers, and includes

certain remaining businesses and assets of our legacy merchant

banking portfolio.

Our reportable business segment information is prepared using

the following methodologies:

•Net revenues and non-interest expenses directly associated

with each reportable business segment are included in

determining earnings from continuing operations before

income taxes.

•Net revenues and non-interest expenses not directly

associated with specific reportable business segments are

allocated based on the most relevant measures applicable,

including each reportable business segment’s net revenues,

headcount and other factors.

•Reportable business segment assets include an allocation of

indirect corporate assets that have been fully allocated to our

reportable business segments, generally based on each

reportable business segment’s capital utilization.

Net revenues presented for our Investment Banking and Capital

Markets reportable segment include allocations of interest

income and interest expense as we assess the profitability of

these businesses inclusive of the net interest revenue or expense

associated with the respective activities, including the net

interest cost of allocated long-term debt, which is a function of

the mix of each business's associated assets and liabilities and

the related funding costs.

	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
$ in millions	2025	2024	2025	2024
Investment Banking and Capital<br><br>Markets:
Net revenues	$1,858.7	$1,620.1	$4,728.2	$4,565.8
Non-interest expenses	1,522.4	1,251.6	4,036.6	3,791.0
Earnings from continuing operations<br><br>before income taxes	336.3	368.5	691.6	774.8
Asset Management:
Net revenues	176.9	59.0	523.2	488.9
Non-interest expenses	193.2	179.3	620.5	586.5
Losses from continuing operations<br><br>before income taxes	(16.3)	(120.3)	(97.3)	(97.6)
Total of Reportable Business<br><br>Segments:
Net revenues	2,035.6	1,679.1	5,251.4	5,054.7
Non-interest expenses	1,715.6	1,430.9	4,657.1	4,377.5
Earnings from continuing operations<br><br>before income taxes	320.0	248.2	594.3	677.2
Reconciliation to consolidated<br><br>amounts:
Net revenues	11.8	4.5	23.5	23.5
Earnings from continuing operations<br><br>before income taxes (1)	11.8	4.5	23.5	23.5
Total:
Net revenues	2,047.4	1,683.6	5,274.9	5,078.2
Non-interest expenses	1,715.6	1,430.9	4,657.1	4,377.5
Earnings from continuing operations<br><br>before income taxes	$331.8	$252.7	$617.8	$700.7

(1)Management does not consider debt valuation adjustments on derivative

contracts, gains and losses on investments held in deferred compensation

plans, foreign currency transaction gains or losses or certain other corporate

income and expense items in assessing the financial performance of

operating businesses. Collectively, these items are included in the

reconciliation of reportable business segment amounts to consolidated

amounts.

$ in millions	August 31,<br><br>2025	November 30,<br><br>2024
Investment Banking and Capital Markets .................	$63,722.7	$59,142.9
Asset Management ......................................................	5,597.0	5,217.4
Total assets ..................................................................	$69,319.7	$64,360.3

Net Revenues by Geographic Region

Net revenues for the Investment Banking and Capital Markets

reportable business segment are recorded in the geographic

region in which the position was risk-managed or, in the case of

investment banking, in which the senior coverage banker is

located. For the Asset Management reportable business

segment, net revenues are allocated according to the location of

the investment advisor or the location of the invested capital.

	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
$ in millions	2025	2024	2025	2024
Americas (1) ..........................................	$1,448.0	$1,159.3	$3,545.3	$3,612.2
Europe and the Middle East (2) ...........	453.8	404.3	1,312.9	1,106.5
Asia-Pacific ............................................	145.6	120.0	416.7	359.5
Net revenues .........................................	$2,047.4	$1,683.6	$5,274.9	$5,078.2

(1)Primarily relates to U.S. results.

(2)Primarily relates to U.K. results.

August 2025 Form 10-Q	45

Notes to Consolidated Financial Statements

(Unaudited)

Note 22. Related Party Transactions

Officers, Directors and Employees

The following sets forth information regarding related party

transactions with our officers, directors and employees:

•At August 31, 2025 and November 30, 2024, we had $19.7

million and $29.4 million, respectively, of loans, net of

allowance, outstanding to certain of our officers and

employees (none of whom are executive officers or directors)

that are included in Other assets.

•Receivables from and payables to customers include balances

arising from officers’, directors’ and employees’ individual

security transactions. These transactions are subject to the

same regulations as all customer transactions and are

provided on substantially the same terms.

•Two of our directors and certain of our officers have total

investments in entities managed by us of approximately

$9.2 million and $5.0 million at August 31, 2025 and

November 30, 2024, respectively.

SMBC

We have a strategic alliance with Sumitomo Mitsui Financial

Group, Inc., Sumitomo Mitsui Banking Corporation (“SMBC”) and

SMBC Nikko Securities Inc. (together referred to as “SMBC

Group”) to collaborate on corporate and investment banking

business opportunities as well as equity sales, trading and

research.

On September 19, 2025, we and the SMBC Group announced a

significant expansion of our global strategic alliance. Key

developments include:

•A planned formation of a joint venture in Japan to integrate our

Japanese equities platform with SMBC Group’s domestic

equity research, sales, trading, and equity capital markets

businesses, expected to launch in January 2027;

•Expansion of joint sponsor coverage in EMEA, targeting larger

sponsors with our combined investment banking and

corporate banking capabilities;

•SMBC Group’s intent to increase its economic ownership from

14.5% to 20% (on an as-converted and fully diluted basis), while

maintaining less than 5% voting interest; and

•SMBC Group’s commitment to provide approximately

$2.5 billion in new credit facilities to us and Jefferies Finance.

These initiatives are designed to deepen the partnership, leverage

complementary strengths, and deliver enhanced services to

clients

The following tables summarize balances with SMBC as reported

in our Consolidated Statements of Financial Condition and

Consolidated Statements of Earnings. In addition, the synergies

and value creation resulting from our strategic alliance with

SMBC generate additive benefits for us, which are not necessarily

reflected by the activity presented in the following tables.

$ in thousands	August 31,<br><br>2025	November 30,<br><br>2024
Assets
Cash and cash equivalents .........................................	$352,693	$542,212
Cash and securities segregated and on deposit<br><br>for regulatory purposes or deposited with<br><br>clearing and depository organizations ................	28,263	—
Financial instruments owned, at fair value ...............	348	1,539
Securities borrowed .....................................................	1,309	20,403
Securities purchased under agreements to resell ...	380,697	381,568
Receivables:
Brokers, dealers and clearing organizations ........	—	3,012
Fees, interest and other ...........................................	4,548	7,851
Other assets ..................................................................	763	175
Total assets ..................................................................	$768,621	$956,760
Liabilities
Financial instruments sold, not yet purchased, at<br><br>fair value ...................................................................	$3,882	$1,830
Securities loaned ..........................................................	3,380	187
Securities sold under agreements to repurchase ...	468,072	631,390
Payables:
Brokers, dealers and clearing organizations .......	40,353	18,701
Accrued expenses and other liabilities .....................	11,090	6,767
Long-term debt (1) .......................................................	350,000	—
Total liabilities ..............................................................	$876,777	$658,875

(1)Interest on this credit facility is based on an adjusted SOFR plus a spread. On

September 19, 2025, we entered into an amendment to increase the amount

drawable on the credit facility to $700.0 million.

	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
$ in thousands	2025	2024	2025	2024
Revenues
Investment banking ...............	$3,114	$455	$11,912	$455
Principal transactions (1) .....	(13,306)	(38,301)	(14,301)	(38,301)
Commissions and other<br><br>fees .....................................	754	180	2,155	180
Interest ....................................	7,222	4,116	21,956	4,116
Total revenues .......................	(2,216)	(33,550)	21,722	(33,550)
Interest expense ....................	10,811	2,411	32,527	2,411
Net revenues ..........................	$(13,027)	$(35,961)	$(10,805)	$(35,961)
Non-interest expenses
Business development .........	$11,108	$4,570	$22,913	$4,570
Other expenses ......................	1	—	6	—
Total non-interest<br><br>expenses ...........................	$11,109	$4,570	$22,919	$4,570

(1)Primarily represents net gains (losses) on interest rate derivatives executed

with SMBC.

Other Related Party Transactions

We have other related party transactions with equity method

investees. Refer to Note 11, Investments for further information.

46	Jefferies Financial Group Inc.

Item 2. Management’s Discussion and Analysis of Financial

Condition and Results of Operations

This report may contain or incorporate by reference certain

“forward-looking statements” within the meaning of Section 27A

of the Securities Act of 1933, Section 21E of the Securities

Exchange Act of 1934 and/or the Private Securities Litigation

Reform Act of 1995. Forward-looking statements include

statements about our future and statements that are not

historical or current facts. These forward-looking statements are

often preceded by the words “should,” “expect,” “believe,”

“intend,” “may,” “will,” “would,” “could” or similar expressions.

Forward-looking statements may contain expectations regarding

revenues, earnings, operations and other results, and may include

statements of future performance, plans and objectives. Forward-

looking statements also include statements pertaining to our

strategies for future development of our business and products.

Forward-looking statements represent only our belief regarding

future events, many of which by their nature are inherently

uncertain. It is possible that the actual results may differ, possibly

materially, from the anticipated results indicated in these

forward-looking statements. Information regarding important

factors that could cause actual results to differ, perhaps

materially, from those in our forward-looking statements is

contained in this report and other documents we file. You should

read and interpret any forward-looking statement together with

these documents, including the following:

•the description of our business and risk factors contained in

our Annual Report on Form 10-K for the year ended

November 30, 2024 and filed with the Securities and Exchange

Commission (“SEC”) on January 28, 2025;

•the discussion of our analysis of financial condition and results

of operations contained in this report under the caption

“Management’s Discussion and Analysis of Financial Condition

and Results of Operations” herein;

•the discussion of our risk management policies, procedures

and methodologies contained in this report under the caption

“Management’s Discussion and Analysis of Financial Condition

and Results of Operations—Risk Management” herein;

•the consolidated financial statements and notes to the

consolidated financial statements contained in this report; and

•cautionary statements we make in our public documents,

reports and announcements.

Any forward-looking statement speaks only as of the date on

which that statement is made. We undertake no obligation to

update any forward-looking statement to reflect events or

circumstances that occur after the date on which the statement

is made, except as required by applicable law.

Our business, by its nature, does not produce predictable or

necessarily recurring earnings. Our results in any given period

can be materially affected by conditions in global financial

markets, economic conditions generally and our own activities

and positions.

Consolidated Results of Operations

Overview

	Three Months Ended<br><br>August 31,
$ in thousands	2025	2024	% Change
Net revenues ....................................................	$2,047,432	$1,683,552	21.6%
Non-interest expenses ....................................	1,715,617	1,430,865	19.9%
Earnings from continuing operations<br><br>before income taxes ........................................	331,815	252,687	31.3%
Income tax expense from continuing<br><br>operations ..........................................................	89,311	78,011	14.5%
Net earnings from continuing operations .....	242,504	174,676	38.8%
Net earnings from discontinued operations,<br><br>net of income taxes .........................................	—	6,363	(100.0)%
Net losses attributable to noncontrolling<br><br>interests .............................................................	(10,041)	(6,874)	46.1%
Preferred stock dividends ...............................	28,559	20,785	37.4%
Net earnings attributable to common<br><br>shareholders .....................................................	223,986	167,128	34.0%
Effective tax rate from continuing<br><br>operations ........................................................	26.9%	30.9%
	Nine Months Ended<br><br>August 31,
$ in thousands	2025	2024	% Change
Net revenues ....................................................	$5,274,898	$5,078,200	3.9%
Non-interest expenses ....................................	4,657,117	4,377,517	6.4%
Earnings from continuing operations<br><br>before income taxes ........................................	617,781	700,683	(11.8)%
Income tax expense from continuing<br><br>operations ..........................................................	147,033	207,077	(29.0)%
Net earnings from continuing operations .....	470,748	493,606	(4.6)%
Net losses from discontinued operations,<br><br>net of income taxes .........................................	—	(1,488)	(100.0)%
Net losses attributable to noncontrolling<br><br>interests .............................................................	(24,692)	(19,102)	29.3%
Preferred stock dividends ...............................	55,528	48,501	14.5%
Net earnings attributable to common<br><br>shareholders .....................................................	439,912	462,719	(4.9)%
Effective tax rate from continuing<br><br>operations ........................................................	23.8%	29.6%
August 2025 Form 10-Q	47
---	---

Executive Summary

Three Months Ended August 31, 2025 Versus August 31, 2024

Consolidated Results

•Net revenues were $2.05 billion, up 21.6% compared to $1.68

billion for the prior year quarter and Earnings from continuing

operations before income taxes were $331.8 million, up 31.3%

compared to $252.7 million for the prior year quarter. This is

reflective of solid performance in our Investment Banking and

Equities businesses, along with a meaningful improvement in

investment returns generated by our Asset Management

business, partially offset by a decline in the performance of our

Fixed Income business.

•Non-compensation expenses were higher compared to the

prior year quarter largely associated with growth in business

activity, particularly in Equities. While non-compensation

expenses were higher for the period, our overall net revenues

for the period grew even faster. Non-compensation expenses

as a percentage of Net revenues was therefore 30.9%

compared to 32.2% for the prior year quarter.

Business Results

•Investment banking net revenues from Advisory, Equity

underwriting and Debt underwriting totaling $1.09 billion were

up 17.4% compared to $925.6 million for the prior year quarter.

Advisory had its best quarter ever with net revenues up 10.7%,

driven by an increase in the average fee per deal earned by us

from mergers and acquisitions advisory services. Total

underwriting net revenues were up 29.3% as market conditions

for equity and debt underwriting improved. Other investment

banking net revenues were $49.0 million, compared to

$17.9 million for the prior year quarter. Other investment

banking net revenues include the net returns on our

investments in our Jefferies Finance and Berkadia joint

ventures and net gains or losses on investments.

•Equities net revenues were $486.7 million, up 25.7% compared

to $387.3 million for the prior year quarter, primarily due to

increased global trading volumes, growth in prime brokerage

and corporate derivatives activity and strong results across

most of our equities business lines.

•Fixed income net revenues were $236.7 million, down 18.2%

compared to $289.2 million for the prior year quarter as activity

levels continued to be slow for the asset classes where we are

most active.

•Asset management net revenues were $176.9 million

compared to $59.0 million for the prior year quarter. Asset

management fees and revenues modestly increased driven by

higher management and performance fees realized during the

current quarter. Investment return net revenues meaningfully

increased due to improved returns generated across a number

of strategies.

Non-interest Expenses

•Compensation and benefits expenses were $1.08 billion, an

increase of 21.9%, compared to $889.1 million for the prior

year quarter. Compensation and benefits expense as a

percentage of Net revenues was essentially flat compared to

the prior year quarter percentage.

•Non-compensation expenses were $632.1 million, 16.7% higher

compared to $541.8 million for the prior year quarter and

versus a 21.6% increase in net revenues. Non-compensation

expenses were higher primarily due to increased brokerage and

clearing fees associated with increased global equities trading

volumes, and increased technology and communication and

business development expenses.

Nine Months Ended August 31, 2025 Versus August 31, 2024

Consolidated Results

•Net revenues were $5.27 billion, up 3.9% compared to $5.08

billion for the prior year period. Following a subdued first-half

of 2025 largely due to uncertainty surrounding U.S. policy and

geopolitical tensions, market activity began to accelerate in

June and demand for our services strengthened and we

continued to sustain growth in our market position.

•Despite the increase in net revenues, Earnings from continuing

operations before income taxes declined 11.8% to

$617.8 million, compared to $700.7 million for the prior year

period. This decrease was largely attributable to higher non-

compensation expenses as our revenues were driven more

heavily by our Equities business, which has higher

transactional costs. Operating margins have improved in

August and are expected to improve further as fixed income

market activity normalizes.

Business Results

•Investment banking net revenues from Advisory, Equity

underwriting and Debt underwriting totaling $2.60 billion were

up 10.9% compared to $2.34 billion for the prior year period.

Advisory net revenues were up 24.4% driven by market share

gains and an increase in mergers and acquisitions activity

levels across most sectors. Total underwriting net revenues

were down 3.6% as stronger results in debt underwriting were

offset by lower equity underwriting activity, consistent with the

overall industry slowdown in the first-half of 2025 associated

with the uncertainty related to U.S. policy and geopolitical

events. Other investment banking net revenues were $4.8

million, compared to net revenues of $116.7 million for the

prior year period. Other investment banking net revenues

include the net returns on our investments in our Jefferies

Finance and Berkadia joint ventures and net gains or losses on

investments, and the prior year period includes Foursight

operating revenues as well as the gain on the sale of Foursight

in April 2024.

•Equities net revenues were $1.42 billion, up 20.3% compared to

$1.18 billion for the prior year period, attributable to market

share gains and increased global trading volumes driving

stronger results across most of our equities business lines.

•Fixed income net revenues were $703.8 million, down 24.0%

compared to $925.8 million for the prior year period, as lower

global activity levels and volatility in credit spreads for the first-

half of 2025 meaningfully impacted the overall trading

environment.

•Asset management net revenues were $523.2 million

compared to $488.9 million for the prior year period. Asset

management fees and revenues increased primarily driven by

higher performance fees realized during the current year.

Investment return net revenues were modestly higher.

Non-interest Expenses

•Compensation and benefits expenses were $2.78 billion, an

increase of 3.8%, compared to $2.68 billion for the prior year

period consistent with the increase in net revenues.

Compensation and benefits expense as a percentage of Net

revenues was 52.7%, flat with the prior year period.

•Non-compensation expenses were $1.88 billion, compared to

$1.70 billion for the prior year period. The increase in non-

48	Jefferies Financial Group Inc.

compensation expenses was primarily due to increased

brokerage and clearing fees associated with increased global

equities trading volumes, and increased business development

and technology and communication expenses. The current

year also includes approximately $17.0 million in charitable

donations, including $9.6 million to support Los Angeles

wildfire relief efforts, as well as a $5.7 million land donation by

HomeFed, and a write-down on certain assets held for sale.

Other expenses for the prior year period include bad debt

expenses of $26.2 million largely related to the shutdown of

Weiss Multi-Strategy Advisers (“Weiss”). In addition, non-

compensation expenses for the prior year period include

Foursight activity up through its sale in April 2024. Non-

compensation expenses as a percentage of Net revenues was

35.6% compared to 33.5% for the prior year period.

Headcount

•At August 31, 2025, we had 7,866 employees globally across

all of our consolidated subsidiaries within our Investment

Banking and Capital Markets and Asset Management

reportable segments, an increase of 242 employees from our

headcount of 7,624 at August 31, 2024. Included within our

global headcount are 1,861 employees at August 31, 2025 and

1,907 employees at August 31, 2024 of our Stratos, Tessellis,

HomeFed and M Science subsidiaries.

Revenues by Source

We present our results as two reportable business segments:

Investment Banking and Capital Markets and Asset Management.

Additionally, corporate activities are fully allocated to each of

these reportable business segments.

Net revenues presented for our Investment Banking and Capital

Markets reportable segment include allocations of interest

income and interest expense as we assess the profitability of

these businesses inclusive of the net interest revenue or expense

associated with the respective activities, including the net

interest cost of allocated short- and long-term debt, which is a

function of the mix of each business’s associated assets and

liabilities and the related funding costs.

The remainder of our “Consolidated Results of Operations” is

presented on a detailed product and expense basis. Our

“Revenues by Source” is reported along the following business

lines: Investment Banking, Equities, Fixed Income and Asset

Management.

Debt valuation adjustments on derivative contracts, gains and

losses on investments held in deferred compensation plans,

foreign currency transaction gains or losses or certain other

corporate income items are not considered by management in

assessing the financial performance of our operating businesses

and are, therefore, not reported as part of our business segment

results.

	Three Months Ended August 31,
	2025		2024
$ in thousands	Amount	% of Net<br><br>Revenues	Amount	% of Net<br><br>Revenues	% Change
Advisory ............................	$655,578	32.0%	$592,462	35.2%	10.7%
Equity underwriting ..........	181,205	8.9	150,096	8.9	20.7
Debt underwriting .............	249,525	12.2	183,078	10.9	36.3
Other investment<br><br>banking ........................	49,017	2.4	17,930	1.1	173.4
Total Investment<br><br>Banking ........................	1,135,325	55.5	943,566	56.1	20.3
Equities ..............................	486,695	23.8	387,342	23.0	25.6
Fixed income .....................	236,687	11.6	289,183	17.2	(18.2)
Total Capital Markets ......	723,382	35.4	676,525	40.2	6.9
Total Investment<br><br>Banking and Capital<br><br>Markets (1) ..................	1,858,707	90.9	1,620,091	96.3	14.7
Asset management fees<br><br>and revenues ..............	15,916	0.8	13,261	0.8	20.0
Investment return .............	68,026	3.3	(40,135)	(2.4)	N/M
Allocated net interest (2) .	(18,550)	(0.9)	(16,016)	(1.0)	15.8
Other investments,<br><br>inclusive of net<br><br>interest .........................	111,490	5.4	101,902	6.1	9.4
Total Asset<br><br>Management ...............	176,882	8.6	59,012	3.5	199.7
Other ...................................	11,843	0.5	4,449	0.2	166.2
Net revenues .....................	$2,047,432	100.0%	$1,683,552	100.0%	21.6%			Nine Months Ended August 31,
---	---	---	---	---	---
	2025		2024
$ in thousands	Amount	% of Net<br><br>Revenues	Amount	% of Net<br><br>Revenues	% Change
Advisory ...............................	$1,511,218	28.6%	$1,214,927	23.9%	24.4%
Equity underwriting .............	432,091	8.2	608,586	12.0	(29.0)
Debt underwriting ................	654,250	12.4	517,771	10.2	26.4
Other investment banking ..	4,765	0.1	116,679	2.3	(95.9)
Total Investment Banking .	2,602,324	49.3	2,457,963	48.4	5.9
Equities .................................	1,421,997	27.0	1,182,025	23.3	20.3
Fixed income ........................	703,824	13.3	925,838	18.2	(24.0)
Total Capital Markets .........	2,125,821	40.3	2,107,863	41.5	0.9
Total Investment Banking<br><br>and Capital Markets<br><br>(1) ....................................	4,728,145	89.6	4,565,826	89.9	3.6
Asset management fees<br><br>and revenues .................	125,312	2.4	89,736	1.8	39.6
Investment return ................	112,796	2.1	110,447	2.2	2.1
Allocated net interest (2) ....	(54,915)	(1.0)	(47,031)	(0.9)	16.8
Other investments,<br><br>inclusive of net interest	340,025	6.4	335,767	6.6	1.3
Total Asset Management ..	523,218	9.9	488,919	9.7	7.0
Other ......................................	23,535	0.5	23,455	0.4	0.3
Net revenues ........................	$5,274,898	100.0%	$5,078,200	100.0%	3.9%

N/M — Not Meaningful

(1)Allocated net interest is not separately disaggregated for Investment Banking

and Capital Markets. This presentation is aligned to our Investment Banking

and Capital Markets internal performance measurement.

(2)Allocated net interest represents an allocation to Asset Management of our

long-term debt interest expense, net of interest income on our Cash and cash

equivalents and other sources of liquidity. Allocated net interest has been

disaggregated to increase transparency and to make clearer actual

Investment return. We believe that aggregating Investment return and

Allocated net interest would obscure the Investment return by including an

amount that is unique to our credit spreads, debt maturity profile, capital

structure, liquidity risks and allocation methods.

August 2025 Form 10-Q	49

Beginning in the fourth quarter of 2024, revenues from corporate

equity derivative transactions historically included within Other

investment banking net revenues were reclassified to Equities net

revenues as the underlying business has matured and has

started to generate meaningful revenues. Prior year amounts

have been revised to conform to this reclassification change to

the current year reporting.

Investment Banking Revenues

Investment banking is composed of revenues from:

•advisory services with respect to mergers and acquisitions,

debt financing, restructurings and private capital transactions;

•underwriting services, which include debt underwriting and

placement services related to investment grade debt, high yield

bonds, leveraged loans, emerging market debt, global

structured notes, municipal debt, mortgage-backed and asset-

backed securities; equity underwriting and placement services

related to equity offerings, preferred stock, and equity-linked

securities; and loan syndication;

•our 50% share of net earnings from our corporate lending joint

venture, Jefferies Finance;

•our 45% share of net earnings from our commercial real estate

joint venture, Berkadia (which includes commercial mortgage

origination and servicing);

•Foursight, our wholly-owned subsidiary engaged in the lending

and servicing of automobile loans (until the sale in April 2024);

•securities and loans received or acquired in connection with

our investment banking activities; and

•certain revenue-sharing agreements with SMBC primarily

associated with investment banking transactions.

	Deals Completed
	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
	2025	2024	2025	2024
Advisory transactions ........	104	103	280	255
Public and private equity<br><br>and convertible<br><br>offerings ...........................	52	50	132	172
Public and private debt<br><br>financings ........................	384	324	865	791			Aggregate Value
---	---	---	---	---
	Three Months Ended<br><br>August 31,		Nine Months Ended<br><br>August 31,
$ in billions	2025	2024	2025	2024
Advisory transactions ..........	$128.9	$107.7	$327.9	$238.5
Public and private equity<br><br>and convertible offerings	25.8	14.8	69.8	59.2
Public and private debt<br><br>financings ..........................	154.2	133.3	401.7	401.3

Three Months Ended August 31, 2025 Versus August 31, 2024

Investment banking net revenues were $1.14 billion, up 20.3%

compared to $943.6 million for the prior year quarter.

Advisory net revenues of $655.6 million reflect our best quarter

ever and were up 10.7% compared to $592.5 million for the

strong prior year quarter, driven by increased deal values in

mergers and acquisitions across most sectors.

Total underwriting net revenues were $430.7 million, up 29.3%

from $333.2 million for the prior year quarter, as market

conditions for equity and debt underwriting improved.

Other investment banking net revenues were $49.0 million,

compared to net revenues of $17.9 million for the prior year

quarter and include mark-to-market net gains on certain

investment positions. Performance from our strategic Berkadia

joint venture increased while performance from our strategic

Jefferies Finance joint venture remained flat from the prior year

quarter.

Our investment banking backlog remains strong, although the

extent and timing of its realization is always subject to change.

Backlog snapshots are subject to limitations as the time frame

for the realization of revenues from these expected transactions

varies and is influenced by factors we do not control.

Transactions not included in the estimate may occur, and

expected transactions may be modified or cancelled.

Nine Months Ended August 31, 2025 Versus August 31, 2024

Investment banking net revenues were $2.60 billion, up 5.9%

compared to $2.46 billion for the prior year period.

Advisory net revenues were $1.51 billion, up 24.4% compared to

$1.21 billion for the prior year period, driven by an increase in the

average fee per deal earned by us from mergers and acquisitions

advisory services.

Total underwriting net revenues were $1.09 billion, down 3.6%

compared to $1.13 billion for the prior year period. Solid net

revenues in Debt underwriting were driven by an increase in

mergers and acquisition activity across most sectors and

collateralized loan origination activity. Equity underwriting net

revenues declined due to reduced transaction activity across

most sectors, reflecting a broader industry slowdown driven by

volatile equity market conditions in the first-half of 2025 as

activity was significantly muted during this period. However, by

June, market conditions began to strengthen and transaction

volumes accelerated as economic and market clarity improved.

Other investment banking net revenues were $4.8 million,

compared to net revenues of $116.7 million for the prior year

period. A significant portion of the decrease is attributable to the

prior year’s inclusion of Foursight operating revenues as well as

the gain on the sale of Foursight in April 2024. The current year

also includes mark-to-market net losses on certain investment

positions compared to mark-to-market net gains in the prior year

period. Additionally, performance from our strategic Berkadia

joint venture increased while performance from our strategic

Jefferies Finance joint venture was lower than the prior year

period.

Equities Net Revenues

Equities is composed of net revenues from:

•services provided to our clients from which we earn

commissions or spread revenue by executing, settling and

clearing transactions for clients;

•advisory services offered to clients;

•financing, securities lending and other prime brokerage

services offered to clients, including capital introductions and

outsourced trading;

•corporate equity derivative transactions; and

•wealth management services.

50	Jefferies Financial Group Inc.

Three Months Ended August 31, 2025 Versus August 31, 2024

Equities net revenues were $486.7 million, up 25.7% from

$387.3 million for the prior year quarter, as increased global

volumes and prime brokerage activity drove stronger results,

particularly within our U.S. and Europe equity cash business. Our

equity options, corporate derivatives and global electronic trading

businesses also produced strong results.

Nine Months Ended August 31, 2025 Versus August 31, 2024

Equities net revenues were $1.42 billion, up 20.3% compared to

$1.18 billion for the prior year period, as market share gains

drove stronger results in our global electronic trading, Europe and

Asia equity cash, equity options, prime services, and corporate

derivatives businesses. These increases were partially offset by

lower revenues from our U.S. equity cash business.

Fixed Income Net Revenues

Fixed income is composed of net revenues from:

•executing transactions for clients and making markets in

securitized products, investment grade, high-yield, distressed,

emerging markets, municipal, sovereign and emerging markets

securities and loans;

•customized products and corporate hedging and foreign

currency solutions through derivative products; and

•financing and other structuring services.

Three Months Ended August 31, 2025 Versus August 31, 2024

Fixed income net revenues were $236.7 million, down 18.2%

compared to $289.2 million for the prior year quarter as a result

of a challenging market in the current quarter as tight credit

conditions continued to slow activity levels for the products and

services where we are most active, impacting the overall trading

environment and several of our businesses, including emerging

markets, leveraged loan trading and distressed.

Nine Months Ended August 31, 2025 Versus August 31, 2024

Fixed income net revenues were $703.8 million, down 24.0%

compared to $925.8 million for the prior year period due to lower

global activity levels and volatility in credit spreads for the first-

half of 2025 meaningfully impacting the overall trading

environment and several of our businesses, including distressed

trading, emerging markets, municipals and rates.

Asset Management

We operate a diversified alternative asset management platform

offering institutional clients a range of investment strategies

directly and through our affiliated asset managers. We provide

certain of our affiliated asset managers access to our global

marketing and distribution platform, as well as operational

infrastructure and support. We often invest our own capital in the

strategies offered by us and associated third-party asset

managers in which we have an interest.

Asset management revenues include the following:

•management and performance fees from funds and accounts

managed by us;

•revenue from affiliated asset managers where we are entitled

to portions of their revenues and/or profits, as well as earnings

on our ownership interests in our affiliated asset managers;

•investment income from our capital invested in and managed

by us and our affiliated asset managers;

•investment and fund placement fees; and

•revenues from investments held in our other investments

portfolio, including consolidated operations from real estate

development activities, foreign exchange trading and

telecommunications activities.

Asset management fees and revenues are impacted by the level

of assets under management and the performance return of

those assets, for the most part on an absolute basis, and, in

certain cases, relative to a benchmark or hurdle. These

components can be affected by financial markets, profits and

losses in the applicable investment portfolios and client capital

activity. Further, asset management fees vary with the nature of

investment management services. The terms under which clients

may terminate our investment management agreements, and the

requisite notice period for such termination, vary depending on

the nature of the investment vehicle and the liquidity of the

portfolio assets. In some instances, performance fees and

similar revenues are recognized once a year, when they become

fixed and determinable and are not probable of being

significantly reversed, typically in December. As a result, a

significant portion of our performance fees and similar revenues

generated from investment returns in a calendar year are

recognized in our following fiscal year.

	Three Months Ended<br><br>August 31,
$ in thousands	2025	2024	% Change
Asset management fees and other ..	$8,235	$7,189	14.6%
Revenue from strategic affiliates (1)	7,681	6,072	26.5%
Total asset management fees and<br><br>revenues ..........................................	15,916	13,261	20.0%
Investment return ................................	68,026	(40,135)	N/M
Allocated net interest ..........................	(18,550)	(16,016)	15.8%
Other investments ...............................	111,490	101,902	9.4%
Total Asset Management ..................	$176,882	$59,012	199.7%			Nine Months Ended<br><br>August 31,
---	---	---	---
$ in thousands	2025	2024	% Change
Asset management fees and other ..	$61,538	$43,540	41.3%
Revenue from strategic affiliates (1)	63,774	46,196	38.1%
Total asset management fees and<br><br>revenues ..........................................	125,312	89,736	39.6%
Investment return ................................	112,796	110,447	2.1%
Allocated net interest ..........................	(54,915)	(47,031)	16.8%
Other investments ...............................	340,025	335,767	1.3%
Total Asset Management ..................	$523,218	$488,919	7.0%

(1)These amounts include our share of fees received by affiliated asset

management companies with which we have revenue and profit share

arrangements, as well as earnings on our ownership interest in affiliated asset

managers.

Three Months Ended August 31, 2025 Versus August 31, 2024

Asset management fees and revenues were $15.9 million, up

20.0% compared to $13.3 million for the prior year quarter,

reflecting higher management and performance fees on funds

managed by us and through our strategic affiliates.

Investment return was $68.0 million, compared to $(40.1) million

for the prior year quarter due to improved returns generated

across a number of fund strategies, particularly those with a long

equity bias.

Other investments net revenues were $111.5 million, up 9.4%

compared to $101.9 million in the prior year quarter, primarily

driven by unrealized gains on certain investment positions.

August 2025 Form 10-Q	51

Nine Months Ended August 31, 2025 Versus August 31, 2024

Asset management fees and revenues were $125.3 million, up

39.6% compared to $89.7 million for the prior year period,

reflecting higher performance fees on funds managed by us and

through our strategic affiliates.

Investment return was $112.8 million, up 2.1% compared to

$110.4 million for the prior year period, as investment

outperformance across multiple fund strategies was partially

offset by losses in several other strategies during the current

year.

Other investments net revenues were $340.0 million and

remained relatively flat compared to $335.8 million for the prior

year period.

Assets Under Management

Aggregate net asset values or net asset value equivalent assets

under management:

$ in millions	August 31,<br><br>2025	November 30,<br><br>2024
Net asset values of seed investments .................	$1,923	$1,761
Net asset values of financed investments ..........	1,025	1,174
Net asset values of investments (1) .....................	2,948	2,935
Assets under management by affiliated asset<br><br>managers with revenue sharing<br><br>arrangements (2) ................................................	25,262	22,515
Third-party and other investments actively<br><br>managed by our wholly-owned managers (3)	2,671	2,596
Total aggregate net asset values or net asset<br><br>value equivalent assets under management .	$30,881	$28,046

(1)Revenues related to the investments made by us are presented in Investment

return within the results of our asset management businesses.

(2)Revenues from our share of fees received by affiliated asset managers are

presented in Revenue from strategic affiliates within the results of our asset

management business. November 30, 2024 includes an adjustment of

$3.02 billion.

(3)We earn asset management fees as a result of the third-party investments,

which are presented in Asset management fees and revenues within the

results of our asset management business.

Assets under management are based on the net asset value or

net asset value equivalent of a fund plus unfunded capital

commitments to the fund, the net asset value equivalents of

separately managed accounts and the fair value of any invested

capital in our consolidated funds and separately managed

accounts. Assets under management is generally based on how

fee and revenues are calculated and the measure also includes

funds and separately managed accounts for which we do not

charge fees.

Our definition of assets under management is not based on any

definition contained in any of our investment management

agreements and differs from the manner in which “Regulatory

Assets Under Management” is reported to the SEC on Form ADV.

Asset Management Investments

Our asset management business makes seed and additional

strategic investments directly in alternative asset management

separately managed accounts and co-mingled funds where we

act as the asset manager or in affiliated asset managers where

we have strategic relationships and participate in the revenues or

profits of the affiliated manager.

Investments by type of asset manager:

$ in thousands	August 31,<br><br>2025	November 30,<br><br>2024
Jefferies Financial Group Inc.; as manager:
Fund investments (1) ...................................................	$183,556	$199,248
Separately managed accounts (2) ............................	224,663	177,998
Total ...............................................................................	$408,219	$377,246
Strategic affiliates; as manager:
Fund investments (1) ...................................................	$1,189,355	$944,940
Separately managed accounts (2) ............................	325,837	439,043
Investments in asset managers .................................	168,124	81,403
Total ...............................................................................	$1,683,316	$1,465,386
Total asset management investments ...................	$2,091,535	$1,842,632

(1)Due to the level or nature of an investment in a fund, we may consolidate that

fund; and accordingly, the assets and liabilities of the fund are included in the

representative line items in our consolidated financial statements. At

August 31, 2025 and November 30, 2024 $12.4 million and $11.3 million,

respectively, represent net investments in funds that have been consolidated

in our financial statements.

(2)Where we have investments in a separately managed account, the assets and

liabilities of such account are presented in our consolidated financial

statements within each respective line item.

Other

Other revenues include foreign currency transaction gains or

losses, debt valuation adjustments on derivative contracts, gains

and losses on investments held in deferred compensation plans

or certain other corporate income items that are not attributed to

business segments as management does not consider such

amounts in assessing the financial performance of our operating

businesses.

Non-interest Expenses

	Three Months Ended<br><br>August 31,
$ in thousands	2025	2024	% Change
Compensation and benefits ...........	$1,083,510	$889,098	21.9%
Brokerage and clearing fees ..........	121,164	101,119	19.8
Underwriting costs ..........................	20,332	14,017	45.1
Technology and communications	157,171	136,953	14.8
Occupancy and equipment rental .	32,908	30,078	9.4
Business development ...................	78,999	68,152	15.9
Professional services .....................	73,329	64,630	13.5
Depreciation and amortization ......	53,230	45,977	15.8
Cost of sales ....................................	34,430	37,400	(7.9)
Other ..................................................	60,544	43,441	39.4
Total non-interest expenses .........	$1,715,617	$1,430,865	19.9%			Nine Months Ended<br><br>August 31,
---	---	---	---
$ in thousands	2025	2024	% Change
Compensation and benefits ...........	$2,779,476	$2,677,962	3.8%
Brokerage and clearing fees ..........	360,345	321,325	12.1
Underwriting costs ..........................	52,703	51,053	3.2
Technology and communications	442,844	409,703	8.1
Occupancy and equipment rental .	93,818	87,558	7.1
Business development ...................	231,360	194,433	19.0
Professional services .....................	223,563	217,967	2.6
Depreciation and amortization ......	136,471	139,125	(1.9)
Cost of sales ....................................	118,959	109,533	8.6
Other ..................................................	217,578	168,858	28.9
Total non-interest expenses .........	$4,657,117	$4,377,517	6.4%
52	Jefferies Financial Group Inc.
---	---

Total Non-interest Expenses

Three Months Ended August 31, 2025 Versus August 31, 2024

Non-interest expenses were $1.72 billion, an increase of 19.9%,

compared to $1.43 billion for the prior year quarter, primarily due

to an increase in compensation and benefits expenses

attributable to higher net revenues.

Nine Months Ended August 31, 2025 Versus August 31, 2024

Non-interest expenses were $4.66 billion, an increase of 6.4%,

compared to $4.38 billion for the prior year period.

Compensation and Benefits

Compensation and benefits expense consists of salaries,

benefits, commissions, annual cash compensation and share-

based awards and the amortization of share-based and cash

compensation awards to employees.

Cash and share-based awards and a portion of cash awards

granted to employees as part of year end compensation generally

contain provisions such that employees who terminate their

employment or are terminated without cause may continue to

vest in their awards, so long as those awards are not forfeited as

a result of other forfeiture provisions (primarily non-compete

clauses) of those awards. Accordingly, the compensation

expense for a portion of awards granted at year end as part of

annual compensation is recorded during the year of the award.

Compensation and benefits expense includes amortization

expense associated with these awards to the extent vesting is

contingent on future service. In addition, certain awards to our

Chief Executive Officer and our President contain performance

conditions and the awards are amortized over their service

periods.

Compensation and benefits expense for the current quarter and

current year was $1.08 billion and $2.78 billion, respectively,

compared to $889.1 million and $2.68 billion for the prior year

quarter and prior year period, respectively. A significant portion of

our compensation expense is highly variable with net revenues.

Compensation and benefits expense as a percentage of Net

revenues was 52.9% and 52.7% for the current quarter and

current year, respectively, compared to 52.8% and 52.7% for the

prior year quarter and prior year period, respectively.

Compensation expense related to the amortization of share- and

cash-based awards amounted to $140.3 million and $440.7

million for the current quarter and current year, respectively,

compared to $117.1 million and $363.7 million for the prior year

quarter and prior year period, respectively.

At August 31, 2025, we had 7,866 employees globally across all

of our consolidated subsidiaries within our Investment Banking

and Capital Markets and Asset Management reportable

segments, an increase of 242 employees from our headcount of

7,624 at November 30, 2024. Included within our global

headcount are 1,861 employees at August 31, 2025 and 1,907

employees at November 30, 2024 of our Stratos, Tessellis,

HomeFed, and M Science subsidiaries.

Non-interest Expenses (Excluding Compensation and Benefits)

Three Months Ended August 31, 2025 Versus August 31, 2024

Non-compensation expenses as a percentage of Net revenues

was 30.9% compared to 32.2% for the current quarter and prior

year quarter, respectively, and was impacted by the following:

•Technology and communication were higher by $20.2 million

related to the continued development of various trading and

management systems as well as higher data related costs.

•Brokerage and clearing fees were higher by $20.0 million

primarily due to increased global equities trading volumes.

•Business development was higher by $10.8 million due to

increased deal related costs.

•Other expenses were higher by $17.1 million, including

$8.1 million related to litigation reserves.

Nine Months Ended August 31, 2025 Versus August 31, 2024

Non-compensation expenses as a percentage of Net revenues

was 35.6% compared to 33.5% for the current year and the prior

year period, respectively, and was impacted by the following:

•Brokerage and clearing fees were higher by $39.0 million

primarily due to increased global equities trading volumes.

•Business development was higher by $36.9 million due to

increased deal related costs and increased expenses related to

business travel, conferences and other events.

•Technology and communication were higher by $33.1 million

related to the continued development of various trading and

management systems as well as higher data related costs.

•Other expenses were higher by $48.7 million and the current

year period includes approximately $17.0 million in charitable

donations, including $9.6 million to support Los Angeles

wildfire relief efforts, as well as a $5.7 million land donation

from HomeFed. Other expenses also include a write-down on

certain assets held for sale. Other expenses for the prior year

period include bad debt expenses of $26.2 million largely

related to the shutdown of Weiss. In addition, the prior year

period includes activity from Foursight, which was sold in April

2024.

Income Taxes

Three Months Ended August 31, 2025 Versus August 31, 2024

The provision for income taxes on continuing operations was

$89.3 million and $78.0 million for the three months ended

August 31, 2025 and 2024, respectively, representing an effective

tax rate of 26.9% and 30.9%, respectively. The lower rate was

primarily driven by the resolution of certain state and local tax

matters.

Nine Months Ended August 31, 2025 Versus August 31, 2024

The provision for income taxes on continuing operations was

$147.0 million and $207.1 million for the nine months ended

August 31, 2025 and 2024, respectively, representing an effective

tax rate of 23.8%, and 29.6%, respectively. The lower rate was

primarily driven by the resolution of certain state and local tax

matters.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was

signed into law. The OBBBA permanently extends and modifies

certain domestic and international provisions from the 2017 Tax

Cuts and Jobs Act and phases out certain provisions from the

2022 Inflation Reduction Act. Certain domestic provisions will

have retroactive effects beginning in 2025, while the international

provisions will generally be effective for years beginning after

December 31, 2025. The OBBBA is not expected to materially

impact our fiscal 2025 results.

August 2025 Form 10-Q	53

Recent Business Developments

On September 19, 2025, we and the SMBC Group announced a

significant expansion of our Japanese strategic alliance originally

established in 2021. Key developments include:

•A planned formation of a joint venture in Japan to integrate our

global equities platform with SMBC Group’s domestic equity

research, sales, trading, and equity capital markets businesses,

expected to launch in January 2027;

•Expansion of joint sponsor coverage in EMEA, targeting larger

sponsors with our combined investment banking and

corporate banking capabilities;

•SMBC Group’s intent to increase its economic ownership from

14.5% to up to 20% (on an as-converted and fully diluted basis),

while maintaining less than 5% voting interest; and

•SMBC Group’s commitment to provide approximately $2.5

billion in new credit facilities to us and Jefferies Finance.

These initiatives are designed to deepen the partnership, leverage

complementary strengths, and deliver enhanced services to

clients.

Accounting Developments

There are no accounting standard updates, except as discussed

in Note 3, Accounting Developments in our consolidated financial

statements included in this Quarterly Report on Form 10-Q which

we have either determined are applicable or expected to have a

material impact on our consolidated financial statements.

Critical Accounting Estimates

Our consolidated financial statements are prepared in conformity

with U.S. generally accepted accounting principles (“U.S. GAAP”),

which requires management to make estimates and

assumptions that affect the amounts reported in our

consolidated financial statements and related notes. Actual

results can and may differ from estimates. These differences

could be material to our consolidated financial statements.

We believe our application of U.S. GAAP and the associated

estimates are reasonable. Our accounting estimates are

reevaluated, and adjustments are made when facts and

circumstances dictate a change. Historically, we have found our

application of accounting policies to be appropriate, and actual

results have not differed materially from those determined using

necessary estimates.

For further discussions of the following significant accounting

policies and other significant accounting policies, refer to Note 2,

Summary of Significant Accounting Policies, in our consolidated

financial statements included in Part II, Item 8 of our Annual

Report on Form 10-K for the year ended November 30, 2024.

Valuation of Financial Instruments

Financial instruments owned and Financial instruments sold, not

yet purchased are recorded at fair value. The fair value of a

financial instrument is the amount that would be received to sell

an asset or paid to transfer a liability in an orderly transaction

between market participants at the measurement date (the exit

price). Unrealized gains or losses are generally recognized in

Principal transactions revenues.

Fair Value Hierarchy – In determining fair value, we maximize the

use of observable inputs and minimize the use of unobservable

inputs by requiring that observable inputs be used when

available. Observable inputs are inputs that market participants

would use in pricing the asset or liability based on market data

obtained from independent sources. Unobservable inputs reflect

our assumptions that market participants would use in pricing

the asset or liability developed based on the best information

available in the circumstances. We apply a hierarchy to

categorize our fair value measurements broken down into three

levels based on the transparency of inputs, where Level 1 uses

observable prices in active markets and Level 3 uses valuation

techniques that incorporate significant unobservable inputs.

Greater use of management judgment is required in determining

fair value when inputs are less observable or unobservable in the

marketplace, such as when the volume or level of trading activity

for a financial instrument has decreased and when certain

factors suggest that observed transactions may not be reflective

of orderly market transactions. Judgment must be applied in

determining the appropriateness of available prices, particularly

in assessing whether available data reflects current prices and/or

reflects the results of recent market transactions. Prices or

quotes are weighed when estimating fair value with greater

reliability placed on information from transactions that are

considered to be representative of orderly market transactions.

Fair value is a market-based measure; therefore, when market

observable inputs are not available, our judgment is applied to

reflect those judgments that a market participant would use in

valuing the same asset or liability. The availability of observable

inputs can vary for different products. We use prices and inputs

that are current as of the measurement date even in periods of

market disruption or illiquidity. The valuation of financial

instruments categorized within Level 3 of the fair value hierarchy

involves the greatest extent of management judgment. (Refer to

Note 2, Summary of Significant Accounting Policies, in our

consolidated financial statements included in Part II, Item 8 of

our Annual Report on Form 10-K for the year ended November 30,

2024 and Note 6, Fair Value Disclosures in our consolidated

financial statements included in this Quarterly Report on Form

10-Q for further information on the definitions of fair value, Level

1, Level 2 and Level 3 and related valuation techniques.)

For information on the composition of our Financial instruments

owned and Financial instruments sold, not yet purchased

recorded at fair value and the composition of activity of our Level

3 assets and Level 3 liabilities, refer to Note 6, Fair Value

Disclosures in our consolidated financial statements included in

this Quarterly Report on Form 10-Q.

Controls Over the Valuation Process for Financial Instruments –

Our Independent Price Verification Group, independent of the

trading function, plays an important role in determining that our

financial instruments are appropriately valued and that fair value

measurements are reliable. This is particularly important where

prices or valuations that require inputs are less observable. In the

event that observable inputs are not available, the control

processes are designed to assure that the valuation approach

utilized is appropriate and consistently applied and that the

assumptions are reasonable. Where a pricing model is used to

determine fair value, these control processes include reviews of

the pricing model’s theoretical soundness and appropriateness

by risk management personnel with relevant expertise who are

independent from the trading desks. In addition, recently

executed comparable transactions and other observable market

data are considered for purposes of validating assumptions

underlying the model.

Income Taxes

Significant judgment is required in estimating our provision for

income taxes. In determining the provision for income taxes, we

must make judgments and interpretations about how to apply

inherently complex tax laws to numerous transactions and

54	Jefferies Financial Group Inc.

business events. In addition, we must make estimates about the

amount, timing and geographic mix of future taxable income,

which includes various tax planning strategies to utilize tax

attributes and deferred tax assets before they expire.

We record a valuation allowance to reduce our net deferred tax

asset to the amount that is more likely than not to be realized. We

are required to consider all available evidence, both positive and

negative, and to weigh the evidence when determining whether a

valuation allowance is required and the amount of such valuation

allowance. Generally, greater weight is required to be placed on

objectively verifiable evidence when making this assessment, in

particular on recent historical operating results.

We also record reserves for unrecognized tax benefits based on

our assessment of the probability of successfully sustaining tax

filing positions. Management exercises significant judgment

when assessing the probability of successfully sustaining tax

filing positions, and in determining whether a contingent tax

liability should be recorded and if so, estimating the amount. If

our tax filing positions are successfully challenged, payments

could be required that are in excess of reserved amounts or we

may be required to reduce the carrying amount of our net

deferred tax asset, either of which could be significant to our

financial condition or results of operations.

Impairment of Equity Method Investments

We evaluate equity method investments for impairment when

operating losses or other factors may indicate a decrease in

value which is other than temporary. We consider a variety of

factors including economic conditions nationally and in an

investment’s geographic area of operation, adverse changes in

the industry in which an investment operates, declines in

business prospects, deterioration in earnings, increasing costs of

operations and other relevant factors specific to the

investee. Whenever we believe conditions or events indicate that

one of these investments might be significantly impaired, we

generally obtain from such investee updated cash flow

projections and obtain other relevant information related to

assessing the overall valuation of the investee. Utilizing this

information, we assess whether the investment is considered to

be other-than-temporarily impaired. To the extent an investment

is deemed to be other-than-temporarily impaired, an impairment

charge is recognized for the amount, if any, by which the

investment’s book value exceeds our estimate of the

investment’s fair value.

Goodwill

At August 31, 2025, goodwill of $1.84 billion represents 2.7% of

total assets. The nature and accounting for goodwill is discussed

in Note 2, Summary of Significant Accounting Policies in our

consolidated financial statements included in Part II, Item 8 of

our Annual Report on Form 10-K for the year ended November 30,

2024 and Note 13, Goodwill and Intangible Assets in our

consolidated financial statements included in this Quarterly

Report on Form 10-Q. Goodwill must be allocated to reporting

units and tested for impairment at least annually, or when

circumstances or events make it more likely than not that an

impairment occurred. Goodwill is tested by comparing the

estimated fair value of each reporting unit with its carrying value.

Our annual goodwill impairment testing date for a substantial

portion of our reporting units is August 1 and November 30 for

other identified reporting units. The results of our annual tests

did not indicate any goodwill impairment.

We use allocated tangible equity plus allocated goodwill and

intangible assets for the carrying amount of each reporting unit.

The amount of tangible equity allocated to a reporting unit is

based on our cash capital model deployed in managing our

businesses, which seeks to approximate the capital a business

would require if it were operating independently. For further

information on our Cash Capital Policy, refer to the Liquidity,

Financial Condition and Capital Resources section herein.

Intangible assets are allocated to a reporting unit based on either

specifically identifying a particular intangible asset as pertaining

to a reporting unit or, if shared among reporting units, based on

an assessment of the reporting unit’s benefit from the intangible

asset in order to generate results.

Estimating the fair value of a reporting unit requires management

judgment and often involves the use of estimates and

assumptions that could have a significant effect on whether or

not an impairment charge is recorded and the magnitude of such

a charge. Estimated fair values for our reporting units utilize

market valuation methods that incorporate price-to-earnings and

price-to-book multiples of comparable public companies and/or

projected cash flows. Under the market valuation approach, the

key assumptions are the selected multiples and our internally

developed projections of future profitability, growth and return on

equity for each reporting unit. The weight assigned to the

multiples requires judgment in qualitatively and quantitatively

evaluating the size, profitability and the nature of the business

activities of the reporting units as compared to the comparable

publicly-traded companies. The valuation methodology for our

reporting units is sensitive to management’s forecasts of future

profitability, which are a significant component of the valuation

and come with a level of uncertainty regarding trading volumes

and capital market transaction levels. In addition, as the fair

values determined under the market valuation approach

represent a noncontrolling interest, we apply a control premium

to arrive at the estimate fair value of each reporting unit on a

controlling basis.

Carrying values of goodwill by reporting unit:

$ in millions	August 31,<br><br>2025	November 30,<br><br>2024
Investment banking ..........................................................	$702.9	$700.7
Equities and wealth management ..................................	256.2	255.4
Fixed income .....................................................................	578.7	576.9
Asset management ..........................................................	143.0	143.0
Other investments ............................................................	159.6	151.9
Total ....................................................................................	$1,840.4	$1,827.9
August 2025 Form 10-Q	55
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Liquidity, Financial Condition and Capital Resources

Our CFO and Global Treasurer are responsible for developing and

implementing our liquidity, funding and capital management

strategies. These policies are determined by the nature and

needs of our day-to-day business operations, business

opportunities, regulatory obligations, and liquidity requirements.

Our actual levels of capital, total assets and financial leverage are

a function of a number of factors, including asset composition,

business initiatives and opportunities, regulatory requirements

and cost and availability of both long term and short-term

funding. We have historically maintained a balance sheet

consisting of a large portion of our total assets in cash and liquid

marketable securities. The liquid nature of these assets provides

us with flexibility in financing and managing our business.

We also own a legacy portfolio of businesses and investments

that are reflected as consolidated subsidiaries, equity

investments or securities. Over the most recent years, we

completed several critical steps to substantially liquidate our

legacy Other investments portfolio of businesses, including the

sales of Foursight in April 2024 and the wholesale operations of

OpNet in August 2024.

In keeping with our strategy of returning excess liquidity to

shareholders, during the nine months ended August 31, 2025, we

returned an aggregate of $339.2 million to shareholders primarily

in the form of $280.6 million in cash dividends and the

repurchases of 734,957 common shares for a total of $58.5

million at a weighted average price of $79.58 per share in

connection with the net share settlement for tax purposes of

stock awards under our equity compensation plans.

We maintain modest leverage to support our investment grade

ratings. The growth of our balance sheet is supported by our

equity and we have quantitative metrics in place to monitor

leverage and double leverage. Our capital plan is robust, in order

to sustain our operating model through stressed conditions. We

maintain adequate financial resources to support business

activities in both normal and stressed market conditions,

including a buffer in excess of our regulatory, or other internal or

external, requirements. Our access to funding and liquidity is

stable and efficient to ensure that there is sufficient liquidity to

meet our financial obligations in normal and stressed market

conditions.

Our Balance Sheet

A business unit level balance sheet and cash capital analysis are

prepared and reviewed with senior management on a weekly

basis. As a part of this balance sheet review process, capital is

allocated to all assets and gross balance sheet limits are

adjusted, as necessary. This process ensures that the allocation

of capital and costs of capital are incorporated into business

decisions. The goals of this process are to protect the firm’s

platform, enable our businesses to remain competitive, maintain

the ability to manage capital proactively and hold businesses

accountable for both balance sheet and capital usage.

We actively monitor and evaluate our financial condition and the

composition of our assets and liabilities. We continually monitor

our overall securities inventory, including the inventory turnover

rate, which confirms the liquidity of our overall assets. A

significant portion of our financial instruments are valued on a

daily basis and we monitor and employ balance sheet limits for

our various businesses.

$ in millions	August 31,<br><br>2025	November 30,<br><br>2024	% Change
Total assets ...........................................	$69,319.7	$64,360.3	7.7%
Cash and cash equivalents ..................	11,458.5	12,153.4	(5.7)
Cash and securities segregated and<br><br>on deposit for regulatory<br><br>purposes or deposited with<br><br>clearing and depository<br><br>organizations ....................................	1,111.6	1,132.6	(1.9)
Financial instruments owned ..............	26,117.1	24,138.3	8.2
Financial instruments sold, not yet<br><br>purchased .........................................	12,356.9	11,007.3	12.3
Total Level 3 assets ..............................	802.9	734.2	9.4
Securities borrowed ..............................	$8,175.1	$7,213.4	13.3%
Securities purchased under<br><br>agreements to resell ........................	7,917.5	6,179.7	28.1
Total securities borrowed and<br><br>securities purchased under<br><br>agreements to resell .......................	$16,092.6	$13,393.1	20.2%
Securities loaned ...................................	$2,498.0	$2,540.9	(1.7)%
Securities sold under agreements to<br><br>repurchase ........................................	12,090.6	12,337.9	(2.0)
Total securities loaned and<br><br>securities sold under agreements<br><br>to repurchase ...................................	$14,588.6	$14,878.8	(2.0)%

Total assets at August 31, 2025 and November 30, 2024 were

$69.32 billion and $64.36 billion, respectively, an increase of

7.7%. During the three and nine months ended August 31, 2025,

average total assets were higher by 13.5% and 13.0%,

respectively, than total assets at August 31, 2025.

Our total Financial instruments owned inventory was $26.12

billion and $24.14 billion at August 31, 2025 and November 30,

2024, respectively. During the nine months ended August 31,

2025, our total Financial instruments owned increased primarily

due to increases in corporate equity securities, loans at fair value

and derivative contracts, partially offset by a decrease in

mortgage and asset backed securities. Financial instruments

sold, not yet purchased inventory was $12.36 billion at August 31,

2025, an increase of 12.3% from $11.01 billion at November 30,

2024, with the increase primarily driven by increases in sovereign

obligations, derivative contracts and corporate equity securities,

partially offset by a decrease in U.S. government and agency

securities. Our overall net inventory position was $13.76 billion

and $13.13 billion at August 31, 2025 and November 30, 2024,

respectively, with the increase primarily due to increases in loans

at fair value, U.S. government and agency securities, and

derivative contracts, partially offset by reductions in mortgage

and asset backed securities and corporate equity securities.

Level 3 assets:

$ in millions	August 31,<br><br>2025	Percent	November 30,<br><br>2024	Percent
Investment Banking ............	$129.7	16.2%	$146.7	20.0%
Equities and Fixed Income .	404.2	50.3	312.2	42.5
Asset Management (1) .......	229.4	28.6	256.2	34.9
Other ......................................	39.6	4.9	19.1	2.6
Total ......................................	$802.9	100.0%	$734.2	100.0%

(1)At August 31, 2025 and November 30, 2024, $194.4 million and $218.3 million,

respectively, are attributed to Other investments within our Asset Management

reportable segment.

Securities financing assets and liabilities include financing for

our financial instruments trading activity, matched book

transactions and mortgage finance transactions. Matched book

transactions accommodate customers, as well as obtain

securities for the settlement and financing of inventory positions.

Our average month end balance of total reverse repos and stock

56	Jefferies Financial Group Inc.

borrows during three and nine months ended August 31, 2025

was 30.6% and 27.0% higher, respectively, than the balance at

August 31, 2025. Our average month end balance of total repos

and stock loans during three and nine months ended August 31,

2025 was 31.9% and 35.2% higher, respectively, than the balance

at August 31, 2025.

Select information related to repurchase agreements:

$ in millions	Nine Months<br><br>Ended<br><br>August 31, 2025	Year Ended<br><br>November 30,<br><br>2024
Securities Purchased Under Agreements to<br><br>Resell:
Period end ...........................................................	$7,917	$6,180
Month end average ............................................	10,426	8,910
Maximum month end ........................................	14,927	10,978
Securities Sold Under Agreements to<br><br>Repurchase:
Period end ...........................................................	$12,091	$12,338
Month end average ............................................	16,699	15,197
Maximum month end ........................................	19,785	20,971

Fluctuations in the balance of our repurchase agreements from

period to period and intraperiod are dependent on business

activity in those periods. Additionally, the fluctuations in the

balances of our securities purchased under agreements to resell

are influenced in any given period by our clients’ balances and

our clients’ desires to execute collateralized financing

arrangements via the repurchase market or via other financing

products. Average balances and period end balances will

fluctuate based on market and liquidity conditions and we

consider the fluctuations intraperiod to be typical for the

repurchase market.

Leverage Ratios:

$ in millions	August 31,<br><br>2025	November 30,<br><br>2024
Total assets ..................................................................	$69,320	$64,360
Total equity ...................................................................	$10,501	$10,225
Total shareholders’ equity ..........................................	$10,439	$10,157
Deduct: Goodwill and intangible assets, net ............	(2,053)	(2,054)
Tangible shareholders’ equity ...................................	$8,386	$8,103
Leverage ratio (1) .........................................................	6.6	6.3
Tangible gross leverage ratio (2) ...............................	8.0	7.7

(1)Leverage ratio equals total assets divided by total equity.

(2)Tangible gross leverage ratio (a non-GAAP financial measure) equals total

assets less goodwill and identifiable intangible assets, net divided by tangible

shareholders’ equity. The tangible gross leverage ratio is used by rating

agencies in assessing our leverage ratio.

Liquidity Management

The key objectives of the liquidity management framework are to

support the successful execution of our business strategies

while ensuring sufficient liquidity through the business cycle and

during periods of financial and idiosyncratic distress. Our liquidity

management policies are designed to mitigate the potential risk

that we may be unable to access adequate financing to service

our financial obligations without material franchise or business

impact.

The principal elements of our liquidity management framework

are our Cash Capital Policy, our assessment of Modeled Liquidity

Outflow (“MLO”) and our Contingency Funding Plan (“CFP”).

Liquidity Management Framework. Our Liquidity Management

Framework is based on a model of a potential liquidity

contraction over a one-year time period. This incorporates

potential cash outflows during a market or our idiosyncratic

liquidity stress event, including, but not limited to, the following:

•Repayment of all unsecured debt maturing within one year and

no incremental unsecured debt issuance;

•Maturity rolloff of outstanding letters of credit with no further

issuance and replacement with cash collateral;

•Higher margin requirements than currently exist on assets on

securities financing activity, including repurchase agreements

and other secured funding including central counterparty

clearinghouses;

•Liquidity outflows related to possible credit downgrade;

•Lower availability of secured funding;

•Client cash withdrawals;

•The anticipated funding of outstanding investment and loan

commitments; and

•Certain accrued expenses and other liabilities and fixed costs.

Cash Capital Policy. We maintain a cash capital model that

measures long-term funding sources against requirements.

Sources of cash capital include our equity, mezzanine equity and

the noncurrent portion of long-term borrowings. Uses of cash

capital include the following:

•Illiquid assets such as equipment, goodwill, net intangible

assets, exchange memberships, deferred tax assets and

certain investments;

•A portion of securities inventory and other assets not expected

to be financed on a secured basis in a credit stressed

environment (i.e., margin requirements); and

•Drawdowns of unfunded commitments.

To ensure that we do not need to liquidate inventory in the event

of a funding stress, we seek to maintain surplus cash capital. Our

total long-term capital of $22.51 billion at August 31, 2025

exceeded our cash capital requirements.

MLO. Our businesses are diverse, and our liquidity needs are

determined by many factors, including market movements,

collateral requirements and client commitments, all of which can

change dramatically in a difficult funding environment. During a

liquidity stress, credit-sensitive funding, including unsecured debt

and some types of secured financing agreements, may be

unavailable, and the terms (e.g., interest rates, collateral

provisions and tenor) or availability of other types of secured

financing may change. As a result of our policy to ensure we have

sufficient funds to cover what we estimate may be needed in a

liquidity stress, we hold more cash and unencumbered securities

and have greater long-term debt balances than our businesses

would otherwise require. As part of this estimation process, we

calculate an MLO that could be experienced in a liquidity stress.

MLO is based on a scenario that includes both a market-wide

stress and firm-specific stress, characterized by some or all of

the following elements:

•Global recession, default by a medium-sized sovereign, low

consumer and corporate confidence, and general financial

instability.

•Severely challenged market environment with material declines

in equity markets and widening of credit spreads.

August 2025 Form 10-Q	57

•Damaging follow-on impacts to financial institutions leading to

the failure of a large bank.

•A firm-specific crisis potentially triggered by material losses,

reputational damage, litigation, executive departure, and/or a

ratings downgrade.

The following are the critical modeling parameters of the MLO:

•Liquidity needs over a 30-day scenario.

•A two-notch downgrade of our long-term senior unsecured

credit ratings.

•No support from government funding facilities.

•A combination of contractual outflows, such as upcoming

maturities of unsecured debt, and contingent outflows (e.g.,

actions though not contractually required, we may deem

necessary in a crisis). We assume that most contingent

outflows will occur within the initial days and weeks of a

stress.

•No diversification benefit across liquidity risks. We assume

that liquidity risks are additive.

The calculation of our MLO under the above stresses and

modeling parameters considers the following potential

contractual and contingent cash and collateral outflows:

•All upcoming maturities of unsecured long-term debt,

promissory notes and other unsecured funding products

assuming we will be unable to issue new unsecured debt or

rollover any maturing debt.

•Repurchases of our outstanding long-term debt in the ordinary

course of business as a market maker.

•A portion of upcoming contractual maturities of secured

funding activity due to either the inability to refinance or the

ability to refinance only at wider haircuts (i.e., on terms which

require us to post additional collateral). Our assumptions

reflect, among other factors, the quality of the underlying

collateral and counterparty concentration.

•Collateral postings to counterparties due to adverse changes in

the value of our over-the-counter (“OTC”) derivatives and other

outflows due to trade terminations, collateral substitutions,

collateral disputes, collateral calls or termination payments

required by a two-notch downgrade in our credit ratings.

•Variation margin postings required due to adverse changes in

the value of our outstanding exchange-traded derivatives and

any increase in initial margin and guarantee fund requirements

by derivative clearing houses.

•Liquidity outflows associated with our prime services business,

including withdrawals of customer credit balances, and a

reduction in customer short positions.

•Liquidity outflows to clearing banks to ensure timely

settlements of cash and securities transactions.

•Draws on our unfunded commitments considering, among

other things, the type of commitment and counterparty.

•Other upcoming large cash outflows, such as employee

compensation, tax and dividend payments, with no expectation

of future dividends from any subsidiaries.

Based on the sources and uses of liquidity calculated under the

MLO scenarios, we determine, based on a calculated surplus or

deficit, additional long-term funding that may be needed versus

funding through the repurchase financing market and consider

any adjustments that may be necessary to our inventory balances

and cash holdings. At August 31, 2025, we had sufficient excess

liquidity to meet all contingent cash outflows detailed in the MLO

for at least 30 days without balance sheet reduction. We regularly

refine our model to reflect changes in market or economic

conditions and our business mix.

CFP. Our CFP ensures the ability to access adequate liquid

financial resources to meet liquidity shortfalls that may arise in

emergency situations. The CFP triggers the following actions:

•Sets out the governance for managing liquidity during a

liquidity crisis;

•Identifies key liquidity and capital early warning indicators that

will help guide the response to the liquidity crisis;

•Identifies the actions and escalation procedures should we

experience a liquidity crisis including coordination amongst

senior management and the Board of Directors;

•Sets out the sources of funding available during a liquidity

crisis;

•Sets out the communication plan during a liquidity crisis for

key external stakeholders including regulators, relationship

banks, rating agencies and funding counterparties; and

•Sets out an action plan to source additional funding.

Sources of Liquidity

Financial instruments that are cash and cash equivalents or are

deemed by management to be generally readily convertible into

cash, marginable or accessible for liquidity purposes within a

relatively short period of time:

$ in thousands	August 31,<br><br>2025	Average<br><br>Balance<br><br>Quarter Ended<br><br>August 31, 2025<br><br>(1)	November 30,<br><br>2024
Cash and cash equivalents:
Cash in banks .............................................	$3,587,781	$4,948,501	$3,925,535
Money market investments (2) ...............	7,870,691	5,892,255	8,227,879
Total cash and cash equivalents ............	11,458,472	10,840,756	12,153,414
Other sources of liquidity:
Debt securities owned and securities<br><br>purchased under agreements to<br><br>resell (3) ................................................	1,925,337	1,854,917	1,287,564
Other (4) ......................................................	780,180	812,470	573,042
Total other sources ...................................	2,705,517	2,667,387	1,860,606
Total cash and cash equivalents and<br><br>other liquidity sources .......................	$14,163,989	$13,508,143	$14,014,020
Total cash and cash equivalents and<br><br>other liquidity sources as % of Total<br><br>assets ....................................................	20.4%		21.8%
Total cash and cash equivalents and<br><br>other liquidity sources as % of Total<br><br>assets less goodwill and intangible<br><br>assets ....................................................	21.1%		22.5%

(1)Average balances are calculated based on weekly balances.

(2)At August 31, 2025 and November 30, 2024, $7.85 billion and $8.21 billion,

respectively, was invested in U.S. government money funds that invest

primarily in cash, securities issued by the U.S. government and U.S.

government-sponsored entities, and repurchase agreements that are fully

collateralized by cash or government securities. The remaining balances at

August 31, 2025 and November 30, 2024 are primarily invested in AAA-rated

prime money funds. The average balance of U.S. government money funds for

the quarter ended August 31, 2025 was $5.88 billion.

(3)Consists of high-quality sovereign government securities and reverse

repurchase agreements collateralized by U.S. government securities and other

high quality sovereign government securities; deposits with a central bank

within the European Economic Area, United Kingdom, Canada, Australia,

Japan, Switzerland or the U.S.; and securities issued by a designated

multilateral development bank and reverse repurchase agreements with

underlying collateral composed of these securities.

58	Jefferies Financial Group Inc.

(4)Other includes unencumbered inventory representing an estimate of the

amount of additional secured financing that could be reasonably expected to

be obtained from our Financial instruments owned that are currently not

pledged after considering reasonable financing haircuts.

In addition to the cash balances and liquidity pool presented

above, the majority of financial instruments (both long and short)

in our trading accounts are actively traded and readily

marketable. At August 31, 2025, we had the ability to readily

obtain repurchase financing for 71.8% of our inventory at haircuts

of 10% or less, which reflects the liquidity of our inventory. In

addition, as a matter of our policy, all of these assets have

internal capital assessed, which is in addition to the funding

haircuts provided in the securities finance markets. Additionally,

certain of our Financial instruments owned primarily consisting

of loans and investments are predominantly funded by long term

capital. Under our cash capital policy, we model capital allocation

levels that are more stringent than the haircuts used in the

market for secured funding; and we maintain surplus capital at

these more stringent levels. We continually assess the liquidity of

our inventory based on the level at which we could obtain

financing in the marketplace for a given asset. Assets are

considered to be liquid if financing can be obtained in the

repurchase market or the securities lending market at collateral

haircut levels of 10% or less.

Financial instruments by asset class that we consider to be of a

liquid nature and the amount of such assets that have not been

pledged as collateral:

	August 31, 2025		November 30, 2024
$ in thousands	Liquid Financial<br><br>Instruments	Unencumbered<br><br>Liquid Financial<br><br>Instruments (1)	Liquid Financial<br><br>Instruments	Unencumbered<br><br>Liquid Financial<br><br>Instruments (1)
Corporate equity<br><br>securities .............	$5,622,725	$965,125	$5,280,920	$781,490
Corporate debt<br><br>securities .............	5,418,081	252,094	5,179,229	339,500
U.S. government,<br><br>agency and<br><br>municipal<br><br>securities .............	3,929,278	165,432	4,061,773	75,911
Other sovereign<br><br>obligations ..........	1,656,706	1,744,260	1,361,762	1,044,630
Agency mortgage-<br><br>backed<br><br>securities (2) .......	2,008,389	—	2,695,282	—
Loans and other<br><br>receivables ..........	129,589	—	978	—
Total ...........................	$18,764,768	$3,126,911	$18,579,944	$2,241,531

(1)Unencumbered liquid balances represent assets that can be sold or used as

collateral for a loan but have not been.

(2)Consists solely of agency mortgage-backed securities issued by the Federal

Home Loan Mortgage Corporation (“Freddie Mac”), the Federal National

Mortgage Association (“Fannie Mae”) and the Government National Mortgage

Association (“Ginnie Mae”).

In addition to being able to be readily financed at reasonable

haircut levels, we estimate that each of the individual securities

within each asset class above could be sold into the market and

converted into cash within three business days under normal

market conditions, assuming that the entire portfolio of a given

asset class was not simultaneously liquidated. There are no

restrictions on the unencumbered liquid securities, nor have they

been pledged as collateral.

Sources of Funding and Capital Resources

Our assets are funded by equity capital, senior debt, securities

loaned, securities sold under agreements to repurchase,

customer free credit balances, bank loans and other payables.

Secured Financing

We rely principally on readily available secured funding to finance

our inventory of financial instruments owned and financial

instruments sold. Our ability to support increases in total assets

is largely a function of our ability to obtain short- and

intermediate-term secured funding, primarily through securities

financing transactions. We finance a portion of our long inventory

and cover some of our short inventory by pledging and borrowing

securities in the form of repurchase or reverse repurchase

agreements (collectively “repos”), respectively. During the nine

months ended August 31, 2025, an average of approximately

55.4% of our cash and noncash repurchase financing activities

used collateral that was considered eligible collateral by central

clearing corporations. Central clearing corporations are situated

between participating members who borrow cash and lend

securities (or vice versa); accordingly, repo participants contract

with the central clearing corporation and not one another

individually. Therefore, counterparty credit risk is borne by the

central clearing corporation which mitigates the risk through

initial margin demands and variation margin calls from repo

participants. The comparatively large proportion of our total repo

activity that is eligible for central clearing reflects the high quality

and liquid composition of the inventory we carry in our trading

books. For those asset classes not eligible for central clearing

house financing, we seek to execute our bi-lateral financings on

an extended term basis and the tenor of our repurchase and

reverse repurchase agreements generally exceeds the expected

holding period of the assets we are financing. The weighted

average maturity of cash and noncash repurchase agreements

for non-clearing corporation eligible funded inventory is

approximately eight months at August 31, 2025.

Our ability to finance our inventory via central clearinghouses and

bi-lateral arrangements is augmented by our ability to draw bank

loans on an uncommitted basis under our various banking

arrangements. At August 31, 2025, short-term borrowings, which

must be repaid within one year or less include bank loans,

overdrafts and borrowings under revolving credit facilities.

Letters of credit are used in the normal course of business

mostly to satisfy various collateral requirements in favor of

exchanges in lieu of depositing cash or securities. Average daily

short-term borrowings outstanding were $1.32 billion and

$1.13 billion for the three and nine months ended August 31,

2025, respectively.

At August 31, 2025 and November 30, 2024, our borrowings

under bank loans in Short-term borrowings were $525.6 million

and $414.5 million, respectively. Our borrowings include credit

facilities that contain certain covenants that, among other things,

require us to maintain a specified level of tangible net worth,

require a minimum regulatory net capital requirement for our U.S.

broker-dealer, Jefferies LLC, and impose certain restrictions on

the future indebtedness of certain of our subsidiaries that are

borrowers. Interest is based on rates at spreads over the federal

funds rate or other adjusted rates, as defined in the various credit

agreements, or at a rate as agreed between the bank and us in

reference to the bank’s cost of funding. At August 31, 2025, we

were in compliance with all covenants under these credit

facilities.

August 2025 Form 10-Q	59

In addition to the above financing arrangements, we issue notes

backed by eligible collateral under master repurchase

agreements, which provide an additional financing source for our

inventory (our “repurchase agreement financing program”). The

notes issued under the program are presented within Other

secured financings. At August 31, 2025, the outstanding notes

totaled $2.49 billion, bear interest at a spread over the Secured

Overnight Funding Rate (“SOFR”) or the Euro Short-Term Rate

(“ESTER”) and mature from September 2025 to October 2028.

Total Long-Term Capital

At August 31, 2025 and November 30, 2024, we had total long-

term capital of $22.51 billion and $21.66 billion, respectively,

resulting in a long-term debt to equity capital ratio of 1.14:1 and

1.12:1, respectively.

$ in thousands	August 31,<br><br>2025	November 30,<br><br>2024
Unsecured Long-Term Debt (1) ..................................	$12,008,375	$11,430,610
Total Mezzanine Equity ...............................................	406	406
Total Equity ...................................................................	10,500,910	10,224,987
Total Long-Term Capital ............................................	$22,509,691	$21,656,003

(1)The amounts at August 31, 2025 and November 30, 2024 exclude our secured

long-term debt. The amount at November 30, 2024 excludes $8.5 million of

our 5.500% Callable Note as the note matured on February 22, 2025,

$5.4 million of our 6.000% Callable Note as the note matured on June 16,

2025,

$6.2 million of our 4.500% Callable Note as the note matured on July 22,

2025, and $500.0 million of our 5.100% Callable Note as the note matures on

September 15, 2025. The amount at August 31, 2025 excludes $449.7 million

and $876.3 million of our Callable Notes as the notes mature on March 16,

2026 and April 16, 2026, respectively, and $45.6 million of our Floating Senior

Notes as the note matures on June 19, 2026. The amounts at August 31, 2025

and November 30, 2024 also exclude $147.5 million and $157.6 million,

respectively, of structured notes as the notes mature within one year.

Long-Term Debt

During the nine months ended August 31, 2025, long-term debt

increased by $2.48 billion to $16.01 billion at August 31, 2025, as

presented in our Consolidated Statements of Financial Condition.

This increase is primarily due to proceeds of $350.0 million from

the drawdown of an unsecured credit facility, $1.00 billion from

the issuances of unsecured senior notes, $527.2 million from net

issuances of structured notes, $1.01 billion from increased

subsidiaries’ borrowings, and $326.4 million from currency

losses on foreign currency borrowings. These increases were

partially offset by repayments of $775.4 million on our unsecured

senior notes.

At August 31, 2025, our unsecured long-term debt has a weighted

average maturity of approximately

7.2

years.

At August 31, 2025 and November 30, 2024, our borrowings

under several credit facilities classified within Long-term debt in

our Consolidated Statements of Financial Condition amounted to

$1.20 billion and $775.3 million, respectively. Interest on these

credit facilities is based on an adjusted SOFR plus a spread or

other adjusted rates, as defined in the various credit agreements.

The credit facility agreements contain certain covenants that,

among other things, require us to maintain specified levels of

tangible net worth and liquidity amounts, certain credit and rating

levels and impose certain restrictions on future indebtedness of

and require specified levels of regulated capital and cash

reserves for certain of our subsidiaries. At August 31, 2025, we

were in compliance with all covenants under theses credit

facilities.

Long-term debt ratings:

	Rating	Outlook
Moody’s Investors Service .........................................	Baa2	Stable
Standard & Poor’s ........................................................	BBB	Stable
Fitch Ratings .................................................................	BBB+	Stable			Jefferies LLC		Jefferies<br><br>International<br><br>Limited		Jefferies GmbH
---	---	---	---	---	---	---
	Rating	Outlook	Rating	Outlook	Rating	Outlook
Moody’s<br><br>Investors<br><br>Service ..........	Baa1	Stable	Baa1	Stable	Baa1	Stable
Standard &<br><br>Poor’s ............	BBB+	Stable	BBB+	Stable	BBB+	Stable

Access to external financing to finance our day-to-day operations,

as well as the cost of that financing, is dependent upon various

factors, including our debt ratings. Our current debt ratings are

dependent upon many factors, including industry dynamics,

operating and economic environment, operating results,

operating margins, earnings trend and volatility, balance sheet

composition, liquidity and liquidity management, our capital

structure, our overall risk management, business diversification

and our market share and competitive position in the markets in

which we operate. Deterioration in any of these factors could

impact our credit ratings. While certain aspects of a credit rating

downgrade are quantifiable pursuant to contractual provisions,

the impact on our business and trading results in future periods

is inherently uncertain and depends on a number of factors,

including the magnitude of the downgrade, the behavior of

individual clients and future mitigating action taken by us.

In connection with certain over-the-counter derivative contract

arrangements and certain other trading arrangements, we may be

required to provide additional collateral to counterparties,

exchanges and clearing organizations in the event of a credit

rating downgrade. At August 31, 2025, the amount of additional

collateral that could be called by counterparties, exchanges and

clearing organizations under the terms of such agreements in the

event of a downgrade of our long-term credit rating below

investment grade was $288.3 million. For certain foreign clearing

organizations, credit rating is only one of several factors

employed in determining collateral that could be called. The

above represents management’s best estimate for additional

collateral to be called in the event of a credit rating downgrade.

The impact of additional collateral requirements is considered in

our CFP and calculation of MLO, as described above.

On September 19, 2025, the SMBC Group announced its

commitment to provide approximately $2.5 billion in new credit

facilities.

Equity Capital

Common Stock

At August 31, 2025 and November 30, 2024, we had 565,000,000

authorized shares of voting common stock with a par value of

$1.00 per share and had 206,280,296 and 205,504,272 common

shares outstanding, respectively. At August 31, 2025, we had

14,213,680 share-based awards that do not require the holder to

pay any exercise price and 5,064,740 stock options that require

the holder to pay a weighted average exercise price of $22.69 per

share.

60	Jefferies Financial Group Inc.

The Board of Directors has authorized the repurchase of

common stock up to $250.0 million under a share repurchase

program. We did not purchase any shares under our share

repurchase program during the nine months ended August 31,

2025. Treasury stock repurchases during the nine months ended

August 31, 2025 represent repurchases of common stock for net-

share tax withholding under our equity compensation plan.

Dividends

Nine Months Ended August 31, 2025
Declaration Date	Record Date	Payment Date	Per Common<br><br>Share Amount
January 8, 2025	February 14, 2025	February 27, 2025	$0.40
March 26, 2025	May 19, 2025	May 29, 2025	$0.40
June 25, 2025	August 18, 2025	August 29, 2025	$0.40

On January 8, 2025, the Board of Directors increased our

quarterly dividend from $0.35 to $0.40 per common share. On

September 29, 2025, the Board of Directors declared a dividend

of $0.40 per common share to be paid on November 26, 2025 to

common shareholders of record at November 17, 2025.

The payment of dividends is subject to the discretion of our

Board of Directors and depends upon general business

conditions and other factors that our Board of Directors may

deem to be relevant.

Non-Voting Common Stock

On June 28, 2023, shareholders approved an Amended and

Restated Certificate of Incorporation, which authorized the

issuance of 35,000,000 shares of non-voting common stock with

a par value of $1.00 per share (the “Non-Voting Common

Shares”). The Non-Voting Common Shares are entitled to share

equally, on a per share basis, with the voting common stock, in

dividends and distributions. Upon the effectiveness of the

Amended and Restated Certificate of Corporation on June 30,

2023, the number of authorized shares of common stock

remains at 600,000,000 shares, composed of 565,000,000 shares

of voting common stock and 35,000,000 shares of Non-Voting

Common Shares.

Preferred Stock

On April 27, 2023, we established Series B Non-Voting

Convertible Preferred Shares with a par value of $1.00 per share

(“Series B Preferred Stock”) and designated 70,000 shares as

Series B Preferred Stock. The Series B Preferred Stock has a

liquidation preference of $17,500 per share and rank senior to our

voting common stock upon dissolution, liquidation or winding up

of Jefferies Financial Group Inc. Each share of Series B Preferred

Stock is automatically convertible into 500 shares of non-voting

common stock, subject to certain anti-dilution adjustments, three

years after issuance. The Series B Preferred Stock participates in

cash dividends and distributions alongside our voting common

stock on an as-converted basis.

Additionally, on April 27, 2023, we entered into an Exchange

Agreement with Sumitomo Mitsui Banking Corporation (“SMBC”),

which entitles SMBC to exchange shares of our voting common

stock for shares of the Series B Preferred Stock at a rate of 500

shares of voting common stock for one share of Series B

Preferred Stock. The Exchange Agreement is limited to 55,125

shares of Preferred Stock and SMBC is required to pay $1.50 per

share of voting common stock so exchanged. As of November

30, 2024, SMBC had cumulatively exchanged approximately 27.6

million shares of voting common stock for 55,125 shares of

Series B Preferred Stock. Following this exchange, SMBC

increased its ownership of our common stock on an as-converted

basis and fully-diluted, as-converted basis. As a result, the CEO of

Sumitomo Mitsui Financial Group, Inc. was elected and now

serves on our Board of Directors. On September 19, 2024, SMBC

purchased 9.2 million shares of our common stock. At August 31,

2025, SMBC owns approximately 15.7% of our common stock on

an as-converted basis and 14.5% on a fully-diluted, as-converted

basis. Refer to Note 22, Related Party Transactions for further

information regarding transactions with SMBC.

On September 19, 2025, our Board of Directors established Series

B-1 Non-Voting Convertible Preferred Shares with a par value of

$1.00 per share (“Series B-1 Preferred Stock”) and designated

17,500 shares as Series B-1 Preferred Stock. The Series B-1

Preferred Stock has a liquidation preference of $500 per share

and ranks senior to our voting common stock and equal to the

Series B Preferred Stock upon dissolution, liquidation or winding

up of Jefferies Financial Group Inc. Each share of Series B-1

Preferred Stock is automatically convertible into 500 shares of

non-voting common stock as soon as such non-voting common

stock exists, subject to certain anti-dilution adjustments. The

Series B-1 Preferred Stock also participates in cash dividends

and distributions alongside our voting common stock on an as-

converted basis.

Additionally, on September 19, 2025, we entered into an amended

and restated Exchange Agreement (the “Amended and Restated

Exchange Agreement”) with SMBC, which entitles SMBC to

exchange shares of our voting common stock for shares of the

Series B-1 Preferred Stock at a rate of 500 shares of voting

common stock for one share of Series B-1 Preferred Stock. The

Amended and Restated Exchange Agreement is limited to 17,500

shares of Series B-1 Preferred Stock. Under the Amended and

Restated Exchange Agreement, SMBC is permitted to increase its

economic ownership in the Company to up to 20% on an as-

converted and fully diluted basis, while continuing to own less

than 5% of a voting interest in the Company.

During the three and nine months ended August 31, 2025, we

paid cash dividends of $11.0 million and $33.1 million,

respectively, compared to $9.6 million and $22.2 million for the

three and nine months ended August 31, 2024, respectively, to

the Series B Preferred stockholder.

Net Capital

Jefferies LLC is a broker-dealer registered with the SEC and a

member firm of the Financial Industry Regulatory Authority

(“FINRA”) and is subject to the SEC Uniform Net Capital Rule

(“Rule 15c3-1”), which requires the maintenance of minimum net

capital, and has elected to calculate minimum capital

requirements using the alternative method permitted by Rule

15c3-1 in calculating net capital. Jefferies LLC, as a dually-

registered U.S. broker-dealer and futures commission merchant

(“FCM”), is also subject to Regulation 1.17 of the Commodity

Futures Trading Commission (“CFTC”) under the Commodity

Exchange Act (“CEA”), which sets forth minimum financial

requirements. The minimum net capital requirement in

determining excess net capital for a dually registered U.S. broker-

dealer and FCM is equal to the greater of the requirement under

SEA Rule 15c3-1 or CFTC Regulation 1.17. Accordingly, FINRA is

the designated examining authority for Jefferies LLC and the

National Futures Association (“NFA”) is the designated self-

regulatory organization (“DSRO”) for Jefferies LLC as an FCM

Jefferies Financial Services, Inc. (“JFSI”) is registered with the

SEC as a Security-Based Swap Dealer (“SBS Dealer”) and an OTC

Derivatives Dealer (“OTCDD”) subject to the SEC’s SBS dealer

regulatory rules and the SEC’s net capital requirements pursuant

to Rule 18a-1. JFSI is also registered as a swap dealer with the

August 2025 Form 10-Q	61

CFTC and is subject to the CFTC’s regulatory capital

requirements pursuant to the minimum financial requirements for

swap dealers under CFTC Regulation 23.101. Additionally, as a

registered member firm, JFSI is subject to the net capital

requirements of the NFA. Accordingly, the SEC is the designated

examining authority for JFSI in its capacity as an SBS Dealer and

OTCDD, while the NFA is the DSRO for JFSI, as a CFTC registered

swap dealer.

Certain non-U.S. subsidiaries are subject to capital adequacy

requirements as prescribed by the regulatory authorities in their

respective jurisdictions. This includes Jefferies International

Limited which is subject to the regulatory supervision and

requirements of the Financial Conduct Authority (“FCA”) in the

U.K. Jefferies International Limited’s’ own funds requirement

represents the highest of the permanent minimum capital

requirement, fixed overheads requirement and k-factor

requirements set out in the Investment Firms Prudential Regime

(“IFPR”) under the FCA’s MIFIDPRU sourcebook.

At August 31, 2025, Jefferies LLC’s and JFSI’s net capital and

excess net capital were as follows:

$ in thousands	Net<br><br>Capital	Excess Net<br><br>Capital
Jefferies LLC .................................................................	$2,204,515	$2,061,318
JFSI - SEC ......................................................................	310,701	290,345
JFSI - CFTC ...................................................................	310,701	283,646

In addition, the equivalent capital requirements for Jefferies

International Limited, on a consolidated basis, is a total capital of

$2.02 billion and an excess capital of $1.15 billion at August 31,

2025.

At August 31, 2025, Jefferies LLC, JFSI and JIL are in compliance

with their applicable requirements.

The regulatory capital requirements referred to above may

restrict our ability to withdraw capital from our regulated

subsidiaries.

Customer Protection and Segregation Requirement

As a registered broker dealer that clears and carries customer

accounts, Jefferies LLC is subject to the customer protection

provisions under SEC Rule 15c3-3 and is required to compute a

reserve formula requirement for customer accounts and deposit

cash or qualified securities into a special reserve bank account

for the exclusive benefit of customers. At August 31, 2025,

Jefferies LLC had $875.6 million in cash and qualified U.S.

Government securities on deposit in special reserve bank

accounts for the exclusive benefit of customers.

As a registered broker dealer that clears and carries proprietary

accounts of brokers or dealers (commonly referred to as “PAB”),

Jefferies LLC is also required to compute a reserve requirement

for PABs pursuant to SEC Rule 15c3-3. At August 31, 2025,

Jefferies LLC had $437.8 million in cash and qualified U.S.

Government securities in special reserve bank accounts for the

exclusive benefit of PABs.

Other Developments

In February 2022, Russia invaded Ukraine. Following Russia’s

invasion, the U.S., the U.K., and the European Union governments,

among others, developed coordinated financial and economic

sanctions targeting Russia that, in various ways, constrain

transactions with numerous Russian entities, including major

Russian banks and individuals; transactions in Russian sovereign

debt; and investment, trade and financing to, from, or in Ukraine.

We do not have any operations in Russia or any clients with

significant Russian operations and we have minimal market risk

related to securities of companies either domiciled or operating

in Russia. We continue to closely monitor the status of global

sanctions and restrictions, trading conditions related to Russian

securities and the credit risk and nature of our counterparties.

In October 2023, Hamas attacked Israel, leading to a multifront

military conflict in the Middle East that has most recently

involved actions by Iran, Israel and the United States. Our

investments and assets in our growing business in the Persian

Gulf, Saudi Arabia and Israel, as well as the global

macroeconomic climate, could be negatively affected by

consequences from this geopolitical and military conflict in the

region. We continue to closely monitor the status of global

sanctions, restrictions and other impacts arising from the

conflict.

Throughout 2025, the United States introduced actions to

increase import tariffs at various rates, including on certain

products imported from almost all countries. Other countries

have responded with retaliatory actions or plans for retaliatory

actions. Some of these tariff announcements have since been

followed by announcements of limited exemptions and

temporary pauses, and wholly new arrangements with key trading

partners of the United States. These actions have led to

increased economic uncertainty, and could negatively impact

global supply chains and trade flow. The potential impact of

tariffs on corporate earnings remains uncertain. We continue to

closely monitor the impact of these matters on our business.

On September 29, 2025, First Brands Group, LLC and certain of its

affiliates (“First Brands”) filed voluntary petitions for Chapter 11

bankruptcy protection. First Brands is an aftermarket auto parts

manufacturer that sells its products to major auto-parts retailers

(the “Obligors”). Point Bonita Capital, a division of Leucadia Asset

Management (“LAM”), manages on behalf of third-party

institutional and other investors an approximately $3 billion

portfolio of trade-finance assets, which is supported by total

invested equity of $1.9 billion, of which $113 million, or 5.9%, is

owned by LAM. Since 2019, the portfolio has included accounts

receivables purchased from First Brands and arising from the

sale of First Brands’ products to Obligors. The purchase of

receivables in this fashion is called factoring, and the Point

Bonita portfolio has approximately $715 million invested in

receivables that are almost entirely due from Walmart, Autozone,

NAPA, O’Reilly Auto Parts, and Advanced Auto Parts, with First

Brands, as the servicer, responsible for directing the Obligors’

payments to Point Bonita. For almost six years until September

15, 2025, Point Bonita always had been paid by the Obligors on

time and in full. On September 15, 2025, First Brands stopped

directing timely transfers of funds from the Obligors on Point

Bonita’s behalf. In its bankruptcy filings, First Brands indicated

that its special advisors were investigating whether receivables

had been turned over to third-party factors upon receipt and

whether receivables may have been factored more than once. We

have not yet received any information regarding the results of

that investigation. We are in communication with First Brands’

advisors and are working diligently to determine what the impact

on Point Bonita might be.

Separately, Apex Credit Partners LLC (“Apex”), a wholly owned

subsidiary of Jefferies Finance, 50%-owned by us, manages on

behalf of third-party institutional and other investors certain CLOs

that invest in broadly syndicated loans with approximately $4.2

billion in assets under management. 12 CLOs and 1 CLO

warehouse managed by Apex own approximately $48 million in

the aggregate of First Brands’ term loans, which is approximately

1% of the CLO assets managed by Apex. Apex owns between 5%

62	Jefferies Financial Group Inc.

and 9.9% of the equity tranche of each of its managed CLOs plus

a portion of the other senior tranches in an amount to comply

with applicable securitization risk-retention rules.

Off-Balance Sheet Arrangements

We have contractual commitments arising in the ordinary course

of business for securities loaned or purchased under agreements

to resell, repurchase agreements, future purchases and sales of

foreign currencies, securities transactions on a when-issued

basis, purchases and sales of corporate loans in the secondary

market and underwriting. Each of these financial instruments and

activities contains varying degrees of off-balance sheet risk

whereby the fair values of the securities underlying the financial

instruments may be in excess of, or less than, the contract

amount. The settlement of these transactions is not expected to

have a material effect upon our consolidated financial

statements.

In the normal course of business, we engage in other off balance-

sheet arrangements, including derivative contracts. Neither

derivatives’ notional amounts nor underlying instrument values

are reflected as assets or liabilities in our Consolidated

Statements of Financial Condition. Rather, the fair values of

derivative contracts are reported in our Consolidated Statements

of Financial Condition as Financial instruments owned or

Financial instruments sold, not yet purchased as applicable.

Derivative contracts are reflected net of cash paid or received

pursuant to credit support agreements and are reported on a net

by counterparty basis when a legal right of offset exists under an

enforceable master netting agreement. For additional information

about our accounting policies and our derivative activities, refer

to Note 2, Summary of Significant Accounting Policies, in our

consolidated financial statements included in Part II, Item 8 of

our Annual Report on Form 10-K for the year ended November 30,

2024 and Note 6, Fair Value Disclosures and Note 7, Derivative

Financial Instruments in our consolidated financial statements

included in this Quarterly Report on Form 10-Q.

Risk Management

Overview

Risk is an inherent part of our business and activities. The extent

to which we properly and effectively identify, assess, monitor and

manage each of the various types of risk involved in our activities

is critical to our financial soundness, viability and profitability.

Accordingly, we have a comprehensive risk management

approach, with a formal governance structure and policies and

procedures outlining frameworks and processes to identify,

assess, monitor and manage risk. Principal risks involved in our

business activities include market, credit, liquidity and capital,

operational, model and strategic risk. Legal and compliance, new

business and reputational risk are also included within our

principal risks.

Risk management is a multifaceted process that requires

communication, judgment and knowledge of financial products

and markets. Our risk management process encompasses the

active involvement of executive and senior management, and

also many departments independent of the revenue-producing

business units, including Risk Management, Operations,

Information Technology, Compliance, Legal and Finance. Our risk

management policies, procedures and methodologies are flexible

in nature and are subject to ongoing review and modification.

In achieving our strategic business objectives, our risk appetite

incorporates keeping our clients’ interests as top priority and

ensuring we are in compliance with applicable laws, rules and

regulations, as well as adhering to the highest ethical standards.

We undertake prudent risk-taking that protects the capital base

and franchise, utilizing risk limits and tolerances that avoid

outsized risk-taking. We maintain a diversified business mix and

avoid significant concentrations to any sector, product,

geography or activity and set quantitative concentration limits to

manage this risk. We consider contagion, second order effects

and correlation in our risk assessment process and actively seek

out value opportunities of all sizes. We manage the risk of

opportunities larger than our approved risk levels through risk

sharing and risk distribution, sell-down and hedging as

appropriate. We have a limited appetite for illiquid assets and

complex derivative financial instruments. We maintain the asset

quality of our balance sheet through conducting trading activity in

liquid markets and generally ensure high turnover of our

inventory. We subject less liquid positions and derivative financial

instruments to particular scrutiny and use a wide variety of

specific metrics, limits and constraints to manage these risks.

We protect our reputation and franchise, as well as our standing

within the market. We operate a federated approach to risk

management and assign risk oversight responsibilities to a

number of functions with specific areas of focus.

For discussion of liquidity and capital risk management, refer to

the “Liquidity, Financial Condition and Capital Resources” section

herein.

Governance and Risk Management Structure

For a discussion of our governance and risk management

structure and our risk management framework, see

“Management’s Discussion and Analysis of Financial Condition

and Results of Operations—Risk Management” in Part II, Item 7 of

our Annual Report on Form 10-K for the year ended November 30,

2024.

Risk Considerations

We apply a comprehensive framework of limits on a variety of

key metrics to constrain the risk profile of our business activities.

The size of the limits reflects our risk appetite for a certain

activity under normal business conditions. Key metrics included

in our risk management framework include inventory position

and exposure limits on a gross and net basis, scenario analysis

and stress tests, Value-at-Risk (“VaR”), sensitivities, exposure

concentrations, aged inventory, Level 3 assets, counterparty

exposure, leverage and cash capital.

Market Risk

Market risk is defined as the risk of loss due to fluctuations in the

market value of financial assets and liabilities attributable to

changes in market variables.

Our market risk principally arises from interest rate risk, from

exposure to changes in the yield curve, the volatility of interest

rates, and credit spreads, and from equity price risks from

exposure to changes in prices and volatilities of individual

equities, equity baskets and equity indices. In addition,

commodity price risk results from exposure to the changes in

prices and volatilities of individual commodities, commodity

baskets and commodity indices, and foreign exchange risk

results from changes in foreign currency rates.

Market risk is present in our capital markets business through

market making, proprietary trading, underwriting and investing

activities and is present in our asset management business

through investments in separately managed accounts and direct

investments in funds. Given our involvement in a broad set of

financial products and markets, market risk exposures are

diversified and economic hedges are established as appropriate.

August 2025 Form 10-Q	63

Market risk is monitored and managed through a set of key risk

metrics such as VaR, stress scenarios, risk sensitivities and

position exposures. Limits are set on the key risk metrics to

monitor and control the risk exposure ensuring that it is in line

with our risk appetite. Our risk appetite, including the market risk

limits, is periodically reviewed to reflect business strategy and

market environment. Material risk changes, top/emerging risks

and limit utilizations/breaches are highlighted through risk

reporting and escalated as necessary.

Trading is principally managed through front office trader

mandates, where each trader is provided a specific mandate in

line with our product registry. Mandates set out the activities,

currencies, countries and products that a desk is permitted to

trade in and set the limits applicable to a desk. Traders are

responsible for knowing their trading limits and trading in a

manner consistent with their mandate.

VaR

VaR is a statistical estimate of the potential loss from adverse

market movements over a specified time horizon within a

specified probability (confidence level). It provides a common

risk measure across financial instruments, markets and asset

classes. We estimate VaR using a model that simulates revenue

and loss distributions by applying historical market changes to

the current portfolio. We calculate a one-day VaR using a one-

year look-back period measured at a 95% confidence level.

	Daily Firmwide VaR
in millions	Daily VaR for the Three Months<br><br>Ended August 31, 2025
Risk Categories	Average	High	Low
Interest Rates and Credit   Spreads .....................................	$5.98	$7.80	$3.91
Equity Prices ................................	9.51	11.37	7.22
Currency Rates ............................	1.71	2.24	1.24
Commodity Prices ......................	0.34	0.78	0.14
Diversification Effect (1) ............	(7.09)	N/A	N/A
Firmwide VaR (2) ........................	$10.45	$12.24	$8.51

All values are in US Dollars.

	Daily Firmwide VaR
in millions	Daily VaR for the Three Months<br><br>Ended May 31, 2025
Risk Categories	Average	High	Low
Interest Rates and Credit   Spreads ..................................	$6.47	$9.31	$3.36
Equity Prices ............................	9.71	13.93	7.14
Currency Rates ........................	2.01	2.61	1.42
Commodity Prices ...................	0.35	0.71	0.17
Diversification Effect (1) ........	(6.65)	N/A	N/A
Firmwide VaR (2) ....................	$11.89	$15.39	$8.96

All values are in US Dollars.

(1)The diversification effect is not applicable for the maximum and minimum

VaR values as the firmwide VaR and the VaR values for the four risk categories

might have occurred on different days during the period.

(2)The aggregated VaR presented here is less than the sum of the individual

components (i.e., interest rate risk, foreign exchange rate risk, equity risk and

commodity price risk) due to the benefit of diversification among the four risk

categories. Diversification benefit equals the difference between aggregated

VaR and the sum of VaRs for the four risk categories and arises because the

market risk categories are not perfectly correlated.

VaR for our capital markets trading activities, which excludes the

impact on VaR for each component of market risk from our asset

management activities, by interest rate and credit spreads, equity,

currency and commodity products:

	Daily Capital Markets VaR
in millions	Daily VaR for the Three Months<br><br>Ended August 31, 2025
Risk Categories	Average	High	Low
Interest Rates and Credit   Spreads .....................................	$5.94	$7.74	$3.84
Equity Prices ................................	4.15	6.15	3.06
Currency Rates ............................	1.12	1.18	1.03
Commodity Prices ......................	0.05	0.18	—
Diversification Effect (1) ............	(4.59)	N/A	N/A
Capital Markets VaR (2) ............	$6.67	$9.81	$5.22

All values are in US Dollars.

	Daily Capital Markets VaR
in millions	Daily VaR for the Three Months<br><br>Ended May 31, 2025
Risk Categories	Average	High	Low
Interest Rates and Credit   Spreads ..................................	$6.19	$9.10	$1.05
Equity Prices ............................	3.99	5.81	2.85
Currency Rates ........................	1.16	1.50	0.64
Commodity Prices ...................	0.08	0.25	—
Diversification Effect (1) ........	(3.10)	N/A	N/A
Capital Markets VaR (2) .........	$8.32	$13.08	$6.13

All values are in US Dollars.

(1)The diversification effect is not applicable for the maximum and minimum

VaR values as the capital markets VaR and the VaR values for the four risk

categories might have occurred on different days during the period.

(2)The aggregated VaR presented here is less than the sum of the individual

components (i.e., interest rate risk, foreign exchange rate risk, equity risk and

commodity price risk) due to the benefit of diversification among the four risk

categories. Diversification benefit equals the difference between aggregated

VaR and the sum of VaRs for the four risk categories and arises because the

market risk categories are not perfectly correlated.

64	Jefferies Financial Group Inc.

Our average daily firmwide VaR decreased to $10.45 million for the three months ended August 31, 2025 from $11.89 million for the

three months ended May 31, 2025, primarily driven by a higher diversification effect and decreases in exposures to movements in

interest rates, credit spreads and currency rates. The average daily capital markets VaR decreased to $6.67 million for the three months

ended August 31, 2025, from $8.32 million for the three months ended May 31, 2025, primarily driven by a higher diversification effect

and decreases in exposures to movements in interest rates and credit spreads.

The efficacy of the VaR model is tested by comparing our actual daily net revenues for those positions included in the calculation of

VaR with the daily VaR estimate. This evaluation is performed at various levels, from the overall level down to specific business lines.

For the VaR model, revenue is defined as principal transactions revenues, trading related commissions, revenue from securitization

activities and net interest income. VaR backtesting methodologies differ for regulated entities with approved capital models.

For a 95% confidence one day VaR model (i.e., no intra-day trading), assuming current changes in market value are consistent with the

historical changes used in the calculation, losses would not be expected to exceed the VaR estimates more than twelve times on an

annual basis (i.e., once in every 20 days). During the three months ended August 31, 2025, there were zero days when the aggregate net

trading loss exceeded the 95% one day VaR.

The chart below presents our daily firmwide and capital markets VaR over the last four quarters. The fluctuations in VaR during the first,

second and third quarters of 2025 were primarily driven by volatility in the equity markets.

Daily Net Trading Revenue

There were 3 days with firmwide trading losses out of a total of 63 trading days during the three months ended August 31, 2025. The

histogram below presents the distribution of our actual daily net trading revenue for substantially all of our trading activities:

August 2025 Form 10-Q	65

Other Risk Measures

The VaR model does not include certain positions that are best measured and monitored using sensitivity analysis. Risk Management

has additional procedures in place to assure that the level of potential loss driven by those positions not in the VaR model arising from

market movements are within acceptable levels. Such procedures include performing stress tests and profit and loss analysis. The

table below presents the potential reduction in earnings associated with a 10% stress of the fair value of the positions that are not

included in the VaR model at August 31, 2025:

$ in thousands	10% Sensitivity
Investment in funds and other (1) ..........................................................................................................................................................................	$195,416
Private investments ..................................................................................................................................................................................................	68,185
Corporate debt securities in default .......................................................................................................................................................................	21,450
Trade claims ..............................................................................................................................................................................................................	2,423

(1)Primarily includes investments in hedge funds, fund of funds and private equity funds classified within Level 3 of the fair value hierarchy and

excluded from the fair value hierarchy based on net asset value.

The impact of changes in our own credit spreads on our structured notes for which the fair value option was elected is not included in

VaR. The estimated credit spread risk sensitivity for each one basis point widening in our own credit spreads on financial liabilities for

which the fair value option was elected was an increase in value of approximately $2.0 million at August 31, 2025, which is included in

other comprehensive income.

Other Risk

We are also subject to interest rate risk on our long-term fixed interest rate debt. Generally, the fair market value of debt securities with

a fixed interest rate will increase as interest rates fall, and the fair market value will decrease as interest rates rise. The following table

represents principal cash flows by expected maturity dates and the related weighted-average interest rate on those maturities for our

consolidated long-term debt obligations, inclusive of any related interest rate hedges. For the variable rate borrowings, the weighted-

average interest rates are based on the rates in effect at the reporting date. Our market risk with respect to foreign currency exposure

on our long-term debt is also presented in the table below.

	Expected Maturity Date (Fiscal Years)
$ in thousands	2025	2026	2027	2028	2029	Thereafter	Total	Fair Value
Rate Sensitive Liabilities:
Fixed Interest Rate Borrowings ...............................	$139,461	$543,532	$614,806	$1,381,296	$304,880	$6,158,171	$9,142,146	$9,171,145
Weighted-Average Interest Rate .............................	1.29%	5.12%	5.24%	5.33%	5.46%	5.60%
Variable Interest Rate Borrowings ..........................	$23,266	$576,797	$1,290,503	$22,413	$117,464	$1,382,103	$3,412,546	$3,331,198
Weighted-Average Interest Rate .............................	5.60%	6.65%	6.56%	5.94%	5.52%	6.17%
Borrowings with Foreign Currency Exposure ........	$55,018	$926,423	$638,515	$584,950	$588,998	$1,032,087	$3,825,991	$3,718,122
Weighted-Average Interest Rate .............................	5.24%	6.30%	3.02%	3.37%	6.47%	6.28%

Stress Tests and Scenario Analysis

Stress tests are used to analyze the potential impact of specific

events or extreme market moves on the current portfolio both

firm-wide and within business segments. Stress testing is an

important part of our risk management approach because it

allows us to quantify our exposure to tail risks, highlight potential

loss concentrations, undertake risk/reward analysis, set risk

controls and overall assess and mitigate our risk.

We employ a range of stress scenarios, which comprise both

historical market price and rate changes and hypothetical market

environments, and generally involve simultaneous changes of

many risk factors. Indicative market changes in the scenarios

include, but are not limited to, a large widening of credit spreads,

a substantial decline in equities markets, significant moves in

selected emerging markets, large moves in interest rates and

changes in the shape of the yield curve.

Unlike our VaR, which measures potential losses within a given

confidence interval, stress scenarios do not have an associated

implied probability. Rather, stress testing is used to estimate the

potential loss from market moves that tend to be larger than

those embedded in the VaR calculation. Stress testing

complements VaR to cover for potential limitations of VaR such

as the breakdown in correlations, non-linear risks, tail risk and

extreme events and capturing market moves beyond the

confidence levels assumed in the VaR calculations.

Stress testing is performed and reported at least weekly as part

of our risk management process and on an ad hoc basis in

response to market events or concerns. Current stress tests

provide estimated revenue and loss of the current portfolio

through a range of both historical and hypothetical events. The

stress scenarios are reviewed and assessed at least annually so

that they remain relevant and up to date with market

developments. Additional hypothetical scenarios are also

conducted on a sub-portfolio basis to assess the impact of any

relevant idiosyncratic stress events as needed.

66	Jefferies Financial Group Inc.

Counterparty Credit Risk

Credit risk is the risk of loss due to adverse changes in a

counterparty’s credit worthiness or its ability or willingness to

meet its financial obligations in accordance with the terms and

conditions of a financial contract.

We are exposed to credit risk as a trading counterparty to other

broker-dealers and customers, as a counterparty to derivative

contracts, as a direct lender and through extending loan

commitments and providing securities-based lending and as a

member of exchanges and clearing organizations. Credit

exposure exists across a wide range of products, including cash

and cash equivalents, loans, securities finance transactions and

over-the-counter derivative contracts. The main sources of credit

risk are:

•Loans and lending arising in connection with our investment

banking and capital markets activities, which reflects our

exposure at risk on a default event with no recovery of loans.

Current exposure represents loans that have been drawn by the

borrower and lending commitments that are outstanding. In

addition, credit exposures on forward settling traded loans are

included within our loans and lending exposures for

consistency with the balance sheet categorization of these

items. Loans and lending also arise in connection with our

portion of a Secured Revolving Credit Facility that is with us

and Massachusetts Mutual Life Insurance Company, to be

funded equally, to support loan underwritings by Jefferies

Finance. For further information on this facility, refer to Note

11, Investments in our consolidated financial statements

included in this Quarterly Report on Form 10-Q. In addition, we

have loans outstanding to certain of our officers and

employees (none of whom are executive officers or directors).

For further information on these employee loans, refer to Note

22, Related Party Transactions in our consolidated financial

statements included in this Quarterly Report on Form 10-Q.

•Securities and margin financing transactions, which reflect our

credit exposure arising from reverse repurchase agreements,

repurchase agreements and securities lending agreements to

the extent the fair value of the underlying collateral differs from

the contractual agreement amount and from margin provided

to customers.

•OTC derivatives, which are reported net by counterparty when a

legal right of setoff exists under an enforceable master netting

agreement. OTC derivative exposure is based on a contract at

fair value, net of cash collateral received or posted under credit

support agreements. In addition, credit exposures on forward

settling trades are included within our derivative credit

exposures.

•Cash and cash equivalents, which includes both interest-

bearing and non-interest-bearing deposits at banks.

Credit is extended to counterparties in a controlled manner and in

order to generate acceptable returns, whether such credit is

granted directly or is incidental to a transaction. All extensions of

credit are monitored and managed as a whole to limit exposure

to loss related to credit risk. Credit risk is managed according to

the Credit Risk Management Policy, which sets out the process

for identifying counterparty credit risk, establishing counterparty

limits, and managing and monitoring credit limits. The policy

includes our approach for:

•Client on-boarding and approving counterparty credit limits;

•Negotiating, approving and monitoring credit terms in legal and

master documentation;

•Determining the analytical standards and risk parameters for

ongoing management and monitoring credit risk books;

•Actively managing daily exposure, exceptions and breaches;

and

•Monitoring daily margin call activity and counterparty

performance.

Counterparty credit exposure limits are granted within our credit

ratings framework, as detailed in the Credit Risk Management

Policy. The Credit Risk Department assesses counterparty credit

risk and sets credit limits at the counterparty master agreement

level. Limits must be approved by appropriate credit officers and

initiated in our credit and trading systems before trading

commences. All credit exposures are reviewed against approved

limits on a daily basis.

Our Secured Revolving Credit Facility, which supports loan

underwritings by Jefferies Finance, is governed under separate

policies other than the Credit Risk Management Policy and is

approved by our Board. The loans outstanding to certain of our

officers and employees are extended pursuant to a review by our

most senior management.

Current counterparty credit exposures at August 31, 2025 and

November 30, 2024 are summarized in the tables below and

provided by credit quality, region and industry. Credit exposures

presented take netting and collateral into consideration by

counterparty and master agreement. Collateral taken into

consideration includes both collateral received as cash as well as

collateral received in the form of securities or other

arrangements. Current exposure is the loss that would be

incurred on a particular set of positions in the event of default by

the counterparty, assuming no recovery. Current exposure equals

the fair value of the positions less collateral. Issuer risk is the

credit risk arising from inventory positions (for example,

corporate debt securities and secondary bank loans). Issuer risk

is included in our country risk exposure within the following

tables.

August 2025 Form 10-Q	67
Counterparty Credit Exposure by Credit Rating
---	---	---	---	---	---	---	---	---	---	---	---	---
	Loans and Lending		Securities and Margin<br><br>Finance		OTC Derivatives		Total		Cash and<br><br>Cash Equivalents		Total with Cash and<br><br>Cash Equivalents
	At		At		At		At		At		At
$ in millions	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024
AAA Range	$—	$—	$7.3	$12.0	$—	$—	$7.3	$12.0	$7,870.7	$8,227.9	$7,878.0	$8,239.9
AA Range	85.3	80.0	253.6	190.3	2.1	5.6	341.0	275.9	15.0	63.8	356.0	339.7
A Range	1.1	0.2	1,203.1	1,145.1	416.2	415.0	1,620.4	1,560.3	3,462.5	3,691.8	5,082.9	5,252.1
BBB Range	250.0	253.5	86.7	31.2	62.7	40.0	399.4	324.7	110.3	169.4	509.7	494.1
BB or Lower	15.8	37.2	32.5	31.2	173.3	78.7	221.6	147.1	—	0.5	221.6	147.6
Unrated	223.9	322.6	—	—	5.7	5.3	229.6	327.9	—	—	229.6	327.9
Total	$576.1	$693.5	$1,583.2	$1,409.8	$660.0	$544.6	$2,819.3	$2,647.9	$11,458.5	$12,153.4	$14,277.8	$14,801.3
Counterparty Credit Exposure by Region
	Loans and Lending		Securities and Margin<br><br>Finance		OTC Derivatives		Total		Cash and<br><br>Cash Equivalents		Total with Cash and<br><br>Cash Equivalents
	At		At		At		At		At		At
$ in millions	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024
Asia-Pacific/Latin<br><br>America/Other	$15.8	$15.8	$192.2	$130.4	$0.5	$0.2	$208.5	$146.4	$652.7	$520.3	$861.2	$666.7
Europe and the Middle<br><br>East	1.1	0.2	488.5	523.2	108.7	88.7	598.3	612.1	63.2	70.8	661.5	682.9
North America	559.2	677.5	902.5	756.2	550.8	455.7	2,012.5	1,889.4	10,742.6	11,562.3	12,755.1	13,451.7
Total	$576.1	$693.5	$1,583.2	$1,409.8	$660.0	$544.6	$2,819.3	$2,647.9	$11,458.5	$12,153.4	$14,277.8	$14,801.3
Counterparty Credit Exposure by Industry
	Loans and Lending		Securities and Margin<br><br>Finance		OTC Derivatives		Total		Cash and<br><br>Cash Equivalents		Total with Cash and<br><br>Cash Equivalents
	At		At		At		At		At		At
$ in millions	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024	August<br><br>31,<br><br>2025	November<br><br>30,<br><br>2024
Asset Managers	$—	$6.4	$—	$0.8	$—	$—	$—	$7.2	$7,870.7	$8,227.9	$7,870.7	$8,235.1
Banks, Broker-Dealers	251.3	253.7	893.2	849.0	435.8	466.6	1,580.3	1,569.3	3,587.8	3,925.5	5,168.1	5,494.8
Corporates	145.0	187.1	—	—	163.6	69.5	308.6	256.6	—	—	308.6	256.6
As Agent Banks	—	—	572.5	474.8	—	—	572.5	474.8	—	—	572.5	474.8
Other	179.8	246.3	117.5	85.2	60.6	8.5	357.9	340.0	—	—	357.9	340.0
Total	$576.1	$693.5	$1,583.2	$1,409.8	$660.0	$544.6	$2,819.3	$2,647.9	$11,458.5	$12,153.4	$14,277.8	$14,801.3
68	Jefferies Financial Group Inc.
---	---

Country Risk Exposure

Country risk is the risk that events or developments that occur in the general environment of a country or countries due to economic,

political, social, regulatory, legal or other factors, will affect the ability of obligors of the country to honor their obligations. We define the

country of risk as the country of jurisdiction or domicile of the obligor and monitor country risk resulting from both trading positions and

counterparty exposure, which may not include the offsetting benefit of any financial instruments utilized to manage market risk. The

following tables reflect our top exposures at August 31, 2025 and November 30, 2024 to the sovereign governments, corporations and

financial institutions in those non- U.S. countries in which we have net long issuer and counterparty exposure:

	August 31, 2025
	Issuer Risk			Counterparty Risk				Issuer and Counterparty Risk
$ in millions	Fair Value of<br><br>Long Debt<br><br>Securities	Fair Value of<br><br>Short Debt<br><br>Securities	Net Derivative<br><br>Notional<br><br>Exposure	Loans and<br><br>Lending	Securities and<br><br>Margin<br><br>Finance	OTC<br><br>Derivatives	Cash and<br><br>Cash<br><br>Equivalents	Excluding<br><br>Cash and<br><br>Cash<br><br>Equivalents	Including<br><br>Cash and<br><br>Cash<br><br>Equivalents
Canada	$192.8	$(175.9)	$48.3	$—	$62.1	$371.7	$—	$499.0	$499.0
United Kingdom	1,602.6	(916.5)	(317.6)	1.0	62.3	50.8	4.5	482.6	487.1
Hong Kong	63.6	(69.5)	(4.7)	—	21.4	—	296.3	10.8	307.1
Japan	2,856.3	(2,821.7)	14.7	—	93.3	—	83.4	142.6	226.0
France	585.3	(600.1)	21.2	0.1	178.6	0.3	—	185.4	185.4
India	16.3	(20.6)	4.1	—	—	—	175.7	(0.2)	175.5
South Korea	796.7	(679.0)	(1.0)	—	9.7	0.1	—	126.5	126.5
Netherlands	535.0	(520.5)	102.2	—	8.5	—	0.6	125.2	125.8
Sweden	205.0	(106.4)	10.2	—	—	—	10.5	108.8	119.3
Spain	443.8	(328.0)	(70.3)	—	72.2	—	1.1	117.7	118.8
Total	$7,297.4	$(6,238.2)	$(192.9)	$1.1	$508.1	$422.9	$572.1	$1,798.4	$2,370.5			November 30, 2024
---	---	---	---	---	---	---	---	---	---
	Issuer Risk			Counterparty Risk				Issuer and Counterparty Risk
$ in millions	Fair Value of<br><br>Long Debt<br><br>Securities	Fair Value of<br><br>Short Debt<br><br>Securities	Net Derivative<br><br>Notional<br><br>Exposure	Loans and<br><br>Lending	Securities and<br><br>Margin<br><br>Finance	OTC<br><br>Derivatives	Cash and<br><br>Cash<br><br>Equivalents	Excluding<br><br>Cash and<br><br>Cash<br><br>Equivalents	Including<br><br>Cash and<br><br>Cash<br><br>Equivalents
Canada	$259.2	$(280.1)	$109.7	$—	$46.6	$360.1	$59.3	$495.5	$554.8
United Kingdom	1,332.5	(680.8)	(364.3)	0.1	95.8	76.5	37.9	459.8	497.7
France	592.2	(495.0)	7.7	0.1	184.9	1.6	—	291.5	291.5
Hong Kong	73.5	(36.5)	(6.0)	—	2.4	—	250.0	33.4	283.4
Spain	403.1	(263.6)	(6.0)	—	63.1	1.2	0.5	197.8	198.3
Netherlands	484.1	(450.4)	125.4	—	5.7	1.7	0.1	166.5	166.6
Japan	2,146.0	(2,093.5)	0.4	—	63.2	—	37.4	116.1	153.5
Australia	523.8	(426.8)	(16.8)	—	26.5	—	44.6	106.7	151.3
India	27.4	(29.7)	—	—	—	—	142.9	(2.3)	140.6
Italy	1,070.9	(569.3)	(402.9)	—	0.4	—	1.1	99.1	100.2
Total	$6,912.7	$(5,325.7)	$(552.8)	$0.2	$488.6	$441.1	$573.8	$1,964.1	$2,537.9

Operational Risk

Operational risk is the risk of financial or non-financial impact,

resulting from inadequate or failed internal processes, people

and systems or from external events. We interpret this definition

as including not only financial loss or gain but also other negative

impacts to our objectives such as reputational impact, legal/

regulatory impact and impact on our clients. Third-party risk is

also included as a subset of operational risk and is defined as the

potential threat presented to us, our employees or clients from

our supply chain and other third parties used to perform a

process, service or activity on our behalf.

Our Operational Risk framework includes governance as well as

operational risk processes, comprises operational risk event

capture and analysis, risk and control self-assessments,

operational risk key indicators, action tracking, risk monitoring

and reporting, deep dive risk assessments, new business

approvals and vendor risk management. Each revenue producing

and support department is responsible for the management and

reporting of operational risks and the implementation of the

Operational Risk Management Policy and processes within the

department with regular operational risk training provided to our

employees.

Operational risk events are mapped to risk categories used for

the consistent classification of risk data to support root cause

and trend analysis, which includes:

•Fraud and Theft

•Clients and Business Practices

•Market Conduct / Regulatory Compliance

•Business Disruption

•Technology

•Data Protection and Privacy

•Trading

•Transaction and Process Management

•People

•Cybersecurity

•Vendor Risk

Our Operational Risk Management Policy and operational risk

management framework, infrastructure, methodology, processes,

guidance and oversight of the operational risk processes are

centralized and consistent firmwide and, additionally, subject to

regional and legal entity operational risk governance, as required.

August 2025 Form 10-Q	69

We also maintain a Third-Party (“Vendor”) Risk Management

Policy and Framework to ensure adequate control and monitoring

over our critical third parties, which includes processes for

conducting periodic reviews covering areas of risk including

financial health, information security, privacy, business continuity

management, disaster recovery and operational risk of our

vendors.

Model Risk

Model risk refers to the risk of loss resulting from decisions that

are based on the output of models, due to errors or weaknesses

in the design and development, implementation or improper use

of models. We use quantitative models primarily to value certain

financial assets and liabilities and to monitor and manage our

risk. Model risk is a function of the model materiality, frequency

of use, complexity and uncertainty around inputs and

assumptions used in a given model. Robust model risk

management is a core part of our risk management approach

and is overseen through our risk governance structure and risk

management controls.

Legal and Compliance Risk

Legal and compliance risk includes the risk of noncompliance

with applicable legal and regulatory requirements. We are subject

to extensive regulation in the different jurisdictions in which we

conduct our business. We have various procedures addressing

issues such as regulatory capital requirements, sales and trading

practices, use of and safekeeping of customer funds, credit

granting, collection activities, anti-money laundering and record

keeping. These risks also reflect the potential impact that

changes in local and international laws and tax statutes have on

the economics and viability of current or future transactions. In

an effort to mitigate these risks, we continuously review new and

pending regulations and legislation and participate in various

industry interest groups. We also maintain an anonymous hotline

for employees or others to report suspected inappropriate

actions by us or by our employees or agents.

New Business Risk

New business risk refers to the risks of entering into a new line of

business or offering a new product. By entering a new line of

business or offering a new product, we may face risks that we are

unaccustomed to dealing with and may increase the magnitude

of the risks we currently face. The New Business Committee

reviews proposals for new businesses and new products to

determine if we are prepared to handle the additional or

increased risks associated with entering into such activities.

Reputational Risk

We recognize that maintaining our reputation among clients,

investors, regulators and the general public is an important

aspect of minimizing legal and operational risks. Maintaining our

reputation depends on a large number of factors, including the

selection of our clients and the conduct of our business

activities. We seek to maintain our reputation by screening

potential clients and by conducting our business activities in

accordance with high ethical standards. Our reputation and

business activity can be affected by statements and actions of

third parties, even false or misleading statements by them. We

actively monitor public comment concerning us and are vigilant

in seeking to assure accurate information and perception

prevails.

Item 3. Quantitative and Qualitative Disclosures About Market

Risk

Quantitative and qualitative disclosures about market risk are set

forth under “Management’s Discussion and Analysis of Financial

Condition and Results of Operations —Risk Management” in

Part I, Item 2 of this Form 10-Q.

Item 4. Controls and Procedures

Our Management, under the direction of our Chief Executive

Officer and Chief Financial Officer, evaluated the effectiveness of

our disclosure controls and procedures as of August 31, 2025.

Based on that evaluation, our Chief Executive Officer and Chief

Financial Officer concluded that our disclosure controls and

procedures as of August 31, 2025 are functioning effectively to

provide reasonable assurance that the information required to be

disclosed by us in reports filed under the Securities Exchange Act

of 1934 is (i) recorded, processed, summarized and reported

within the time periods specified in the SEC’s rules and forms and

(ii) accumulated and communicated to our management,

including our Chief Executive Officer and Chief Financial Officer,

as appropriate, to allow timely decisions regarding disclosure. A

controls system cannot provide absolute assurance that the

objectives of the controls system are met, and no evaluation of

controls can provide absolute assurance that all control issues

and instances of fraud, if any, within a company have been

detected.

No change in our internal control over financial reporting

occurred during the quarter ended August 31, 2025 that has

materially affected, or is reasonably likely to materially affect, our

internal control over financial reporting.

70	Jefferies Financial Group Inc.

PART II. OTHER INFORMATION

Item 1. Legal Proceedings

Many aspects of our business involve substantial risks of legal

and regulatory liability. In the normal course of business, we have

been named as defendants or co-defendants in lawsuits involving

primarily claims for damages. We are also involved in a number

of judicial and regulatory matters, including exams, investigations

and similar reviews, arising out of the conduct of our business.

Based on currently available information, we do not believe that

any matter will have a material adverse effect on our

consolidated financial statements.

In July 2024, we commenced litigation against the former

portfolio manager of 3ǀ5ǀ2 Capital ABS Master Fund LP (the

“Fund”) and a variety of individuals and entities (collectively, the

“defendants”), alleging that the defendants engaged in a

longstanding Ponzi scheme resulting in the misappropriation of

approximately $106 million from investors in the Fund and in

certain related accounts, including a separately managed

account held by the Company. In June 2025, we commenced

litigation against First Fed Bank alleging that it participated in and

aided and abetted the Ponzi scheme. To date, the Company has

recognized a loss of $17.2 million. We anticipate that this

litigation, which will not be resolved in the near term, will result in

the recovery of some or all of our losses but cannot, with any

reliable accuracy, estimate how much we will be able to recover,

or the outcome of this litigation, which may lead to additional

proceedings.

Item 1A. Risk Factors

Information regarding our risk factors appears in Item 1A. of our

Annual Report on Form 10-K for the year ended November 30,

2024. These risk factors describe some of the assumptions,

risks, uncertainties and other factors that could adversely affect

our business or that could otherwise result in changes that differ

materially from our expectations.

Item 2. Unregistered Sales of Equity Securities and Use of

Proceeds

(a) We did not have any unregistered sales of equity securities

during the three months ended August 31, 2025.

(c) Issuer Purchases of Equity Securities.

Purchases of our common shares during the three months ended

August 31, 2025:

$ in thousands, except share<br><br>and per share amounts	(a) Total<br><br>Number of<br><br>Shares<br><br>Purchased<br><br>(1)	(b) Average<br><br>Price Paid<br><br>per Share	(c) Total<br><br>Number of<br><br>Shares<br><br>Purchased as<br><br>Part of<br><br>Publicly<br><br>Announced<br><br>Plans<br><br>or Programs	(d)<br><br>Approximate<br><br>Dollar Value<br><br>of Shares<br><br>that May Yet<br><br>Be<br><br>Purchased<br><br>Under the<br><br>Plans or<br><br>Programs
June 1, 2025 to<br><br>June 30, 2025 ...........................	—	$—	—	$250,000
July 1, 2025 to<br><br>July 31, 2025 ............................	13,313	$55.82	—	$250,000
August 1, 2025 to<br><br>August 31, 2025 .......................	3,042	$57.63	—	$250,000
Total...........................................	16,355	$56.16	—

(1)An aggregate 16,355 shares repurchased other than as part of our publicly

announced Board authorized repurchase program. We repurchased securities in

connection with our share compensation plans which allow participants to satisfy

certain tax liabilities arising from the vesting of restricted shares and the distribution

of restricted share units with shares.

Item 5. Other Information

Rule 10b5-1 Trading Plans

During the three months ended August 31, 2025, no directors or

executive officers entered into, modified or terminated, contracts,

instructions or written plans for the sale or purchase of the

Company’s securities that were intended to satisfy the

affirmative defense conditions of Rule 10b5-1.

Item 6. Exhibits

Exhibit<br><br>No.	Description
3.1	Certificate of Amendment of the Certificate of Incorporationhttps://www.sec.gov/Archives/edgar/data/96223/000114036125035569/ef20055771_ex3-1.htm<br><br>relating to the Series B-1 Preferred Stock is incorporated byhttps://www.sec.gov/Archives/edgar/data/96223/000114036125035569/ef20055771_ex3-1.htm<br><br>reference to Exhibit 3.1 to the Company’s Current Report onhttps://www.sec.gov/Archives/edgar/data/96223/000114036125035569/ef20055771_ex3-1.htm<br><br>Form 8-K filed on September 19, 2025.*
10.1	Amended and Restated Exchange Agreement, dated as ofhttps://www.sec.gov/Archives/edgar/data/96223/000114036125035471/ef20055770_ex10-1.htm<br><br>September 19, 2025, by and between Jefferies Financialhttps://www.sec.gov/Archives/edgar/data/96223/000114036125035471/ef20055770_ex10-1.htm<br><br>Group Inc., a New York corporation, and Sumitomo Mitsuihttps://www.sec.gov/Archives/edgar/data/96223/000114036125035471/ef20055770_ex10-1.htm<br><br>Banking Corporation, a joint stock company incorporated inhttps://www.sec.gov/Archives/edgar/data/96223/000114036125035471/ef20055770_ex10-1.htm<br><br>Japan, is incorporated by reference to Exhibit 10.1 to thehttps://www.sec.gov/Archives/edgar/data/96223/000114036125035471/ef20055770_ex10-1.htm<br><br>Company’s Current Report on Form 8-K filed on Septemberhttps://www.sec.gov/Archives/edgar/data/96223/000114036125035471/ef20055770_ex10-1.htm<br><br>19, 2025.*
31.1	Certification of Chief Executive Officer pursuant to Sectionexhibit3118312025.htm<br><br>302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Chief Financial Officer pursuant to Sectionexhibit3128312025.htm<br><br>302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Chief Executive Officer pursuant to Sectionexhibit3218312025.htm<br><br>906 of the Sarbanes-Oxley Act of 2002. **
32.2	Certification of Chief Financial Officer pursuant to Sectionexhibit3228312025.htm<br><br>906 of the Sarbanes-Oxley Act of 2002. **
101	Interactive Data Files pursuant to Rule 405 of Regulation S-T,<br><br>formatted in Inline Extensible Business Reporting Language<br><br>(iXBRL).
104	Cover page interactive data file pursuant to Rule 406 of<br><br>Regulation S-T, formatted in iXBRL (included in exhibit 101)
+	Management/Employment Contract or Compensatory Plan<br><br>or Arrangement.
*	Incorporated by reference.
**	Furnished herewith pursuant to item 601(b) (32) of<br><br>Regulation S-K.
August 2025 Form 10-Q	71
---	---

Signatures

Pursuant to the requirements of Section 13 or 15(d) of the

Securities Exchange Act of 1934, the registrant has duly caused

this report to be signed on its behalf by the undersigned,

thereunto duly authorized.

Jefferies Financial Group Inc.
/s/     MATT LARSON
Matt Larson
Executive Vice President and Chief Financial Officer

Dated: October 9, 2025

Document

Exhibit 31.1

CERTIFICATION

I, Richard B. Handler, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Jefferies Financial Group Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	October 9, 2025	By:	/s/ Richard B. Handler
			Name:<br>Title:	Richard B. Handler<br>Chief Executive Officer

Document

Exhibit 31.2

CERTIFICATION

I, Matt Larson, certify that:

1.I have reviewed this quarterly report on Form 10-Q of Jefferies Financial Group Inc.;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect the registrant's internal control over financial reporting; and

5.The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date:	October 9, 2025	By:	/s/ Matt Larson
			Name:<br>Title:	Matt Larson<br>Chief Financial Officer

Document

Exhibit 32.1

CERTIFICATION

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED BY SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Richard B. Handler, as Chief Executive Officer of Jefferies Financial Group Inc. (the "Company"), certify, as of the date hereof and solely for purposes of and pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1)The Quarterly Report on Form 10-Q for the period ending August 31, 2025 as filed with the U.S. Securities and Exchange Commission (the "Report") fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(2)The information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	October 9, 2025	By:	/s/ Richard B. Handler
			Name:<br>Title:	Richard B. Handler<br>Chief Executive Officer

Document

Exhibit 32.2

CERTIFICATION

PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED BY SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I, Matt Larson, as Chief Financial Officer of Jefferies Financial Group Inc. (the "Company"), certify, as of the date hereof and solely for purposes of and pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

(1)The Quarterly Report on Form 10-Q for the period ending August 31, 2025 as filed with the U.S. Securities and Exchange Commission (the "Report") fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934, as amended; and

(2)The information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date:	October 9, 2025	By:	/s/ Matt Larson
			Name:<br>Title:	Matt Larson<br>Chief Financial Officer