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 May 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 incorporation or organization)			(I.R.S. Employer 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 June 30, 2025 was 206,280,221.

Jefferies Financial Group, Inc.

Index to Quarterly Report on Form 10-Q

May 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 ...............................................	45
Item 3. Quantitative and Qualitative Disclosures About Market Risk ....................................................................................................	68
Item 4. Controls and Procedures ..................................................................................................................................................................	68
PART II. OTHER INFORMATION
Item 1. Legal Proceedings .............................................................................................................................................................................	69
Item 1A. Risk Factors .....................................................................................................................................................................................	69
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds ..................................................................................................	69
Item 5. Other Information ..............................................................................................................................................................................	69
Item 6. Exhibits ................................................................................................................................................................................................	69

2 Jefferies Financial Group Inc.

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements.

$ in thousands, except share and per share amounts	May 31,  2025	November 30, 2024
Assets
Cash and cash equivalents ...............................................................................................................................................................	$11,260,403	$12,153,414
Cash and securities segregated and on deposit for regulatory purposes or deposited with clearing and depository organizations (includes $120,414 of securities at fair value at November 30, 2024) .........................................................	1,051,304	1,132,612
Financial instruments owned, at fair value (includes securities pledged of $18,404,776 and $18,441,751) .......................	25,570,194	24,138,274
Investments in and loans to related parties ...................................................................................................................................	1,436,583	1,385,658
Securities borrowed ...........................................................................................................................................................................	7,844,835	7,213,421
Securities purchased under agreements to resell ........................................................................................................................	7,485,007	6,179,653
Securities received as collateral, at fair value ................................................................................................................................	50,968	185,588
Receivables:
Brokers, dealers and clearing organizations ...............................................................................................................................	2,766,535	2,666,591
Customers ........................................................................................................................................................................................	2,652,808	2,494,717
Fees, interest and other ..................................................................................................................................................................	805,846	663,536
Premises and equipment ..................................................................................................................................................................	1,235,343	1,194,720
Goodwill ...............................................................................................................................................................................................	1,842,114	1,827,938
Assets held for sale ...........................................................................................................................................................................	39,128	51,885
Other assets (includes assets pledged of $532,703 and $429,347) ..........................................................................................	3,244,276	3,072,302
Total assets ........................................................................................................................................................................................	$67,285,344	$64,360,309
Liabilities and Equity
Short-term borrowings ......................................................................................................................................................................	$1,315,103	$443,160
Financial instruments sold, not yet purchased, at fair value .......................................................................................................	11,775,135	11,007,328
Securities loaned ................................................................................................................................................................................	2,041,795	2,540,861
Securities sold under agreements to repurchase .........................................................................................................................	12,157,620	12,337,935
Other secured financings (includes $429,289 and $24,848 at fair value) .................................................................................	2,741,561	2,183,000
Obligation to return securities received as collateral, at fair value .............................................................................................	50,968	185,588
Payables:
Brokers, dealers and clearing organizations ...............................................................................................................................	3,809,896	3,686,367
Customers ........................................................................................................................................................................................	4,266,776	4,073,975
Lease liabilities ...................................................................................................................................................................................	616,494	635,306
Accrued expenses and other liabilities ...........................................................................................................................................	2,775,449	3,510,831
Long-term debt (includes $3,304,517 and $2,351,346 at fair value) ..........................................................................................	15,351,967	13,530,565
Total liabilities ....................................................................................................................................................................................	56,902,764	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; liquidation preference of $17,500 per share .............................................................................................................................	55	55
Common shares, par value $1 per share, authorized 565,000,000 shares; 206,271,769 and 205,504,272 shares issued and outstanding, after deducting 114,846,301 and 115,613,798 shares held in treasury ..................................................	206,272	205,504
Non-voting common shares, par value $1 per share, authorized 35,000,000, shares; no shares issued and outstanding ....................................................................................................................................................................................	—	—
Additional paid-in capital ..................................................................................................................................................................	2,129,358	2,104,199
Accumulated other comprehensive loss ........................................................................................................................................	(339,695)	(423,131)
Retained earnings ..............................................................................................................................................................................	8,309,035	8,270,145
Total Jefferies Financial Group Inc. shareholders' equity ..........................................................................................................	10,305,025	10,156,772
Noncontrolling interests ...................................................................................................................................................................	77,149	68,215
Total equity .........................................................................................................................................................................................	10,382,174	10,224,987
Total liabilities and equity ................................................................................................................................................................	$67,285,344	$64,360,309

See accompanying notes to consolidated financial statements.

May 2025 Form 10-Q 3

Consolidated Statements of Earnings (Unaudited)

	Three Months Ended May 31,		Six Months Ended May 31,
$ in thousands, except per share amounts	2025	2024	2025	2024
Revenues
Investment banking ...............................................................................................	$789,269	$738,584	$1,518,779	$1,417,649
Principal transactions ............................................................................................	338,507	416,195	745,737	1,056,931
Commissions and other fees ...............................................................................	353,233	271,782	641,533	517,325
Asset management fees and revenues ..............................................................	20,076	11,768	105,484	62,140
Interest .....................................................................................................................	878,025	879,727	1,723,196	1,699,216
Other .........................................................................................................................	115,205	198,240	232,450	314,977
Total revenues ........................................................................................................	2,494,315	$2,516,296	4,967,179	5,068,238
Interest expense .....................................................................................................	859,868	859,851	1,739,713	1,673,590
Net revenues ...........................................................................................................	1,634,447	1,656,445	3,227,466	3,394,648
Non-interest expenses
Compensation and benefits .................................................................................	854,839	861,993	1,695,966	1,788,864
Brokerage and clearing fees .................................................................................	129,745	110,536	239,181	220,206
Underwriting costs .................................................................................................	14,525	18,552	32,371	37,036
Technology and communications .......................................................................	146,198	135,238	285,673	272,750
Occupancy and equipment rental ........................................................................	30,711	29,327	60,910	57,480
Business development ..........................................................................................	80,070	68,630	152,361	126,281
Professional services ............................................................................................	77,768	75,493	150,234	153,337
Depreciation and amortization .............................................................................	52,253	49,946	83,241	93,148
Cost of sales ...........................................................................................................	42,961	37,462	84,529	72,133
Other expenses .......................................................................................................	70,476	41,514	157,034	125,417
Total non-interest expenses ................................................................................	1,499,546	1,428,691	2,941,500	2,946,652
Earnings from continuing operations before income taxes ............................	134,901	227,754	285,966	447,996
Income tax expense ...............................................................................................	43,506	73,107	57,722	129,066
Net earnings from continuing operations ...........................................................	91,395	154,647	228,244	318,930
Net earnings (losses) from discontinued operations, net of income tax benefit of $0, $173, $0, and $3,176 .....................................................................	—	40	—	(7,851)
Net earnings ...........................................................................................................	91,395	154,687	228,244	311,079
Net losses attributable to noncontrolling interests ...........................................	(7,668)	(4,790)	(14,651)	(12,228)
Preferred stock dividends .....................................................................................	11,046	13,741	26,940	27,930
Net earnings attributable to common shareholders ........................................	$88,017	$145,736	$215,955	$295,377
Earnings per common share
Basic from continuing operations .......................................................................	$0.41	$0.66	$1.01	$1.37
Diluted from continuing operations .....................................................................	0.40	0.64	0.97	1.34
Basic .........................................................................................................................	0.41	0.66	1.01	1.34
Diluted ......................................................................................................................	0.40	0.64	0.97	1.31
Weighted-average common shares outstanding .............................................
Basic .........................................................................................................................	215,097	219,971	214,818	219,935
Diluted ......................................................................................................................	221,897	226,146	222,383	225,587

See accompanying notes to consolidated financial statements.

4 Jefferies Financial Group Inc.

Consolidated Statements of Comprehensive Income (Unaudited)

	Three Months Ended  May 31,		Six Months Ended  May 31,
$ in thousands	2025	2024	2025	2024
Net earnings ...................................................................................................................	$91,395	$154,687	$228,244	$311,079
Other comprehensive income (loss), net of tax:
Currency translation adjustments and other (1) ......................................................	46,769	(4,018)	31,447	(4,117)
Changes in fair value related to instrument-specific credit risk (2) ......................	21,571	(9,950)	51,827	(12,702)
Unrealized gains (losses) on available-for-sale-securities ....................................	37	(328)	162	1,630
Total other comprehensive income (loss), net of tax (3) .......................................	68,377	(14,296)	83,436	(15,189)
Comprehensive income ................................................................................................	159,772	140,391	311,680	295,890
Net losses attributable to noncontrolling interests ..................................................	(7,668)	(4,790)	(14,651)	(12,228)
Preferred stock dividends ............................................................................................	11,046	13,741	26,940	27,930
Comprehensive income attributable to common shareholders ............................	$156,394	$131,440	$299,391	$280,188

(1)Includes income tax expenses of $14.6 million and $10.1 million for the three and six months ended May 31, 2025, respectively, and income tax

benefits of $0.7 million for both the three and six months ended May 31, 2024.

(2)Includes income tax expenses of $7.9 million and $18.6 million for the three and six months ended May 31, 2025, respectively, and income tax

benefits of $3.9 million and $5.1 million for the three and six months ended May 31, 2024, respectively.

(3)Includes currency translation adjustments attributable to noncontrolling interests of $1.6 million and $1.9 million for the three and six months

ended May 31, 2024, respectively.

See accompanying notes to consolidated financial statements.

May 2025 Form 10-Q 5

Consolidated Statements of Changes in Equity (Unaudited)

	Three Months Ended May 31,		Six Months Ended May 31,
$ in thousands, except share amounts	2025	2024	2025	2024
Preferred shares $1 par value
Balance, beginning of period .............................................................................	$55	$42	$55	$42
Balance, end of period .......................................................................................	$55	$42	$55	$42
Common shares $1 par value
Balance, beginning of period .............................................................................	$206,250	$212,001	$205,504	$210,627
Purchase of common shares for treasury ...................................................	(23)	(15)	(719)	(1,082)
Other ..................................................................................................................	45	67	1,487	2,508
Balance, end of period .......................................................................................	$206,272	$212,053	$206,272	$212,053
Additional paid-in capital
Balance, beginning of period .............................................................................	$2,094,138	$2,026,584	$2,104,199	$2,044,859
Share-based compensation expense ............................................................	18,193	14,357	53,830	34,572
Purchase of common shares for treasury ...................................................	(1,227)	(931)	(56,849)	(42,897)
Dividend equivalents .......................................................................................	8,354	4,926	16,951	9,680
Change in equity interest related to consolidated subsidiaries ................	(1,976)	—	(1,123)	—
Other ..................................................................................................................	11,876	6,213	12,350	4,935
Balance, end of period .......................................................................................	$2,129,358	$2,051,149	$2,129,358	$2,051,149
Accumulated other comprehensive loss, net of tax
Balance, beginning of period .............................................................................	$(408,072)	$(396,438)	$(423,131)	$(395,545)
Other comprehensive income (loss), net of taxes ......................................	68,377	(14,296)	83,436	(15,189)
Balance, end of period .......................................................................................	$(339,695)	$(410,734)	$(339,695)	$(410,734)
Retained earnings
Balance, beginning of period .............................................................................	$8,311,857	$7,937,908	$8,270,145	$7,849,844
Net earnings attributable to Jefferies Financial Group Inc. .......................	99,063	159,478	242,895	323,308
Dividends - common shares ($0.40, $0.30, $0.80, $0.60) per share) .......	(90,860)	(68,540)	(181,955)	(136,903)
Dividends - preferred shares ..........................................................................	(11,025)	(6,300)	(22,050)	(12,600)
Cumulative effect of change in accounting principle for current expected credit losses, net of tax .............................................................	—	—	—	(644)
Other ..................................................................................................................	—	—	—	(459)
Balance, end of period .......................................................................................	$8,309,035	$8,022,546	$8,309,035	$8,022,546
Total Jefferies Financial Group Inc. shareholders' equity ...........................	$10,305,025	$9,875,056	$10,305,025	$9,875,056
Noncontrolling interests
Balance, beginning of period .............................................................................	$64,211	$87,372	$68,215	$92,308
Net losses attributable to noncontrolling interests ....................................	(7,668)	(4,790)	(14,651)	(12,228)
Contributions ....................................................................................................	17,350	5	17,454	9,321
Distributions .....................................................................................................	(1,528)	(3,563)	(4,323)	(10,689)
Change in equity interest related to consolidated subsidiaries ................	4,273	—	3,420	—
Other ..................................................................................................................	511	(1,894)	7,034	(1,582)
Balance, end of period .......................................................................................	$77,149	$77,130	$77,149	$77,130
Total equity ..........................................................................................................	$10,382,174	$9,952,186	$10,382,174	$9,952,186

See accompanying notes to consolidated financial statements.

6 Jefferies Financial Group Inc.

Consolidated Statements of Cash Flows (Unaudited)

	Six Months Ended May 31,
$ in thousands	2025	2024
Cash flows from operating activities:
Net earnings ......................................................................................................................................................................................	$228,244	$311,079
Adjustments to reconcile net earnings to net cash used in operating activities:
Depreciation and amortization ....................................................................................................................................................	88,454	93,722
Share-based compensation .........................................................................................................................................................	53,830	34,572
Net bad debt expense ...................................................................................................................................................................	13,463	46,593
Income on investments in and loans to related parties ...........................................................................................................	(15,162)	(37,202)
Distributions received on investments in related parties ........................................................................................................	28,593	874
Gain on sale of subsidiaries and investments in related parties ............................................................................................	—	(56,174)
Other adjustments .........................................................................................................................................................................	184,362	147,851
Net change in assets and liabilities:
Receivables:
Brokers, dealers and clearing organizations ..........................................................................................................................	(90,224)	(722,293)
Customers ...................................................................................................................................................................................	(158,094)	(594,067)
Fees, interest and other .............................................................................................................................................................	(143,594)	(114,271)
Securities borrowed ......................................................................................................................................................................	(622,392)	48,414
Financial instruments owned .......................................................................................................................................................	(1,241,243)	(937,418)
Securities purchased under agreements to resell ....................................................................................................................	(1,266,238)	(799,421)
Other assets ...................................................................................................................................................................................	(205,378)	(539,351)
Payables:
Brokers, dealers and clearing organizations ..........................................................................................................................	112,293	601,124
Customers ...................................................................................................................................................................................	192,801	(119,505)
Securities loaned ...........................................................................................................................................................................	(509,851)	405,066
Financial instruments sold, not yet purchased .........................................................................................................................	727,110	680,922
Securities sold under agreements to repurchase .....................................................................................................................	(217,150)	122,236
Lease liabilities ..............................................................................................................................................................................	(33,240)	(38,778)
Accrued expenses and other liabilities ......................................................................................................................................	(770,081)	285,980
Net cash used in operating activities from continuing operations .........................................................................................	(3,643,497)	(1,180,047)
Net cash used in operating activities from discontinued operations .....................................................................................	—	(90,174)
Cash flows from investing activities:
Contributions to investments in and loans to related parties .................................................................................................	(111,087)	(62,543)
Capital distributions from investments and repayments of loans from related parties .....................................................	47,190	7,941
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 ..............................................................................................................................	(93,247)	(144,857)
Proceeds from sales of subsidiary and investment in related parties, net of cash of operations sold ...........................	—	95,276
Net cash used in investing activities from continuing operations ..........................................................................................	(157,144)	(110,455)

May 2025 Form 10-Q 7

Consolidated Statements of Cash Flows (Unaudited)

	Six Months Ended May 31,
$ in thousands	2025	2024
Cash flows from financing activities:
Proceeds from short-term borrowings .......................................................................................................................................	$4,744,829	$2,113,633
Payments on short-term borrowings ..........................................................................................................................................	(3,852,844)	(1,495,796)
Proceeds from issuance of long-term debt, net of issuance costs .......................................................................................	2,635,540	3,527,009
Repayment of long-term debt ......................................................................................................................................................	(960,857)	(726,019)
Purchase of common shares for treasury .................................................................................................................................	(57,568)	(43,979)
Dividends paid to common and preferred shareholders .........................................................................................................	(187,054)	(139,823)
Net proceeds from other secured financings ...........................................................................................................................	556,902	240,898
Net change in bank overdrafts ....................................................................................................................................................	(22,945)	17,754
Proceeds from contributions of noncontrolling interests .......................................................................................................	16,354	9,321
Payments on distributions to noncontrolling interests ............................................................................................................	(3,223)	(10,689)
Other ................................................................................................................................................................................................	16,134	6,984
Net cash provided by financing activities from continuing operations ..................................................................................	2,885,268	3,499,293
Net cash provided by financing activities from discontinued operations ..............................................................................	—	4,384
Effect of exchange rate changes on cash, cash equivalents, and restricted cash ...............................................................	61,470	(1,513)
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 .................................................................................	(853,905)	2,121,488
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 ..................................................................................................	$12,311,707	$11,939,022
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest ............................................................................................................................................................................................	$1,716,136	$1,579,458
Income taxes, net ..........................................................................................................................................................................	53,197	88,988

Noncash investing activities:

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

During the six months ended May 31, 2024, we had a stock distribution of $0.6 million from one of our equity method investments.

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

	May 31,	November 30,
$ in thousands	2025	2024
Cash and cash equivalents ...........................................................................................................................................	$11,260,403	$12,153,414
Cash on deposit for regulatory purposes with clearing and depository organizations .......................................	1,051,304	1,012,198
Total cash, cash equivalents and restricted cash ....................................................................................................	$12,311,707	$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 ...............................................................................................................................................................	34
Note 15. Compensation Plans ....................................................................................................................................................................................................	36
Note 16. Borrowings .....................................................................................................................................................................................................................	36
Note 17. Total Equity ....................................................................................................................................................................................................................	38
Note 18. Income Taxes ................................................................................................................................................................................................................	40
Note 19. Commitments, Contingencies and Guarantees .......................................................................................................................................................	40
Note 20. Regulatory Requirements ............................................................................................................................................................................................	42
Note 21. Segment Reporting .......................................................................................................................................................................................................	43
Note 22. Related Party Transactions .........................................................................................................................................................................................	44

May 2025 Form 10-Q 9

Notes to Consolidated Financial Statements

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. 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 six months ended May 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

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.

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.

Note 4. Business Acquisitions

We acquired OpNet during the fourth quarter of 2023. OpNet is a

fixed wireless broadband service provider in Italy and also owned

a majority of the common shares of Tessellis S.p.A. (“Tessellis”),

a telecommunications company publicly listed on the Italian

stock exchange. Upon obtaining control of OpNet, we accounted

for this transaction under the acquisition method of accounting,

which requires that the assets acquired, including identifiable

intangible assets, and liabilities assumed to be recognized at

their respective fair values as of the acquisition date.

OpNet

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

the voting rights of OpNet 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. 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. 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.

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.

May 2025 Form 10-Q 11

Notes to Consolidated Financial Statements

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 February 2024, we agreed to sell substantially all of OpNet’s

wholesale operating assets. The sale closed in August 2024 and

we 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 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 is expected to close in the third quarter of 2025.

12 Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

Note 6. Fair Value Disclosures

	May 31, 2025 (1)
$ in thousands	Level 1	Level 2	Level 3	Counterparty and Cash Collateral Netting (2)	Total
Assets:
Financial instruments owned:
Corporate equity securities ..................................................................................	$5,018,987	$417,979	$231,160	$—	$5,668,126
Corporate debt securities .....................................................................................	—	5,375,646	44,682	—	5,420,328
Collateralized debt obligations and collateralized loan obligations ...............	—	685,511	70,948	—	756,459
U.S. government and federal agency securities ................................................	3,139,294	130,185	—	—	3,269,479
Municipal securities ..............................................................................................	—	621,737	—	—	621,737
Sovereign obligations ............................................................................................	694,500	738,064	—	—	1,432,564
Residential mortgage-backed securities ............................................................	—	2,040,529	7,947	—	2,048,476
Commercial mortgage-backed securities ..........................................................	—	72,563	505	—	73,068
Other asset-backed securities .............................................................................	—	579,030	153,681	—	732,711
Loans and other receivables ................................................................................	—	2,572,953	92,168	—	2,665,121
Derivatives ..............................................................................................................	472	3,995,263	8,569	(2,715,818)	1,288,486
Investments at fair value ......................................................................................	—	7	153,379	—	153,386
Total financial instruments owned, excluding Investments at fair value based on NAV ....................................................................................................	$8,853,253	$17,229,467	$763,039	$(2,715,818)	$24,129,941
Securities received as collateral ..........................................................................	$50,968	$—	$—	$—	$50,968
Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities ..................................................................................	$3,870,700	$14,554	$161	$—	$3,885,415
Corporate debt securities .....................................................................................	—	3,534,470	644	—	3,535,114
Collateralized debt obligations and collateralized loan obligations ...............	—	1	—	—	1
U.S. government and federal agency securities ................................................	2,136,579	5	—	—	2,136,584
Sovereign obligations ............................................................................................	814,027	592,350	—	—	1,406,377
Commercial mortgage-backed securities ..........................................................	—	37	1,153	—	1,190
Loans .......................................................................................................................	—	87,415	313	—	87,728
Derivatives ..............................................................................................................	—	3,768,347	41,857	(3,087,478)	722,726
Total financial instruments sold, not yet purchased .......................................	$6,821,306	$7,997,179	$44,128	$(3,087,478)	$11,775,135
Other secured financings ......................................................................................	$—	$410,413	$18,876	$—	$429,289
Obligation to return securities received as collateral .......................................	50,968	—	—	—	50,968
Long-term debt .......................................................................................................	—	2,313,361	991,156	—	3,304,517

(1)Excludes investments at fair value based on net asset value (“NAV”) of $1.44 billion at May 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.

May 2025 Form 10-Q 13

Notes to Consolidated Financial Statements

	November 30, 2024 (1)
$ in thousands	Level 1	Level 2	Level 3	Counterparty and Cash Collateral 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 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 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

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:

	May 31, 2025
$ in thousands	Fair Value (1)	Unfunded Commitments	Redemption Frequency	Redemption Notice Period
Hedge Funds (2) ..............	$689,960	$—	Quarterly (50%) Monthly (50%)	45 - 90 days 45 - 60 days
Private Equity Funds (3) ..............	64,532	26,638	N/R (100%)	N/R
Credit Funds (4) ..............	489,597	106	Quarterly (60%) Monthly (2%) N/R (38%)	90 days 30 days N/R
Real Estate and Other Funds (5) ....	196,164	164,982	Quarterly (26%) N/R (74%)	90 days N/R
Total ......................	$1,440,253	$191,726

	November 30, 2024
$ in thousands	Fair Value (1)	Unfunded Commitments	Redemption Frequency	Redemption Notice Period
Hedge Funds (2) ............	$660,720	$—	Quarterly (53%) Monthly (47%)	45 - 90 days 45 - 60 days
Private Equity Funds (3) ............	60,215	30,530	N/R (100%)	N/R
Credit Funds (4)	430,429	30,554	Quarterly (72%) Monthly (3%) N/R (25%)	90 days 30 days N/R
Real Estate and Other Funds (5) .	101,325	232,696	N/R (100%)	N/R
Total ...................	$1,252,689	$293,780

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 ten 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;

•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.

May 2025 Form 10-Q 15

Notes to Consolidated Financial Statements

Level 3 Rollforwards

	Three Months Ended May 31, 2025
$ in thousands	Balance at February 28, 2025	Total gains/ losses (realized and unrealized) (1)	Purchases	Sales	Settlements	Issuances	Net transfers into/ (out of) Level 3	Balance at May 31, 2025	For instruments still held at May 31, 2025, changes in  unrealized gains (losses) included in:
									Earnings (1)	Other comprehensive income (loss) (1)
Level 3 assets:
Financial instruments owned:
Corporate equity securities ....................	$212,409	$8,245	$2,482	$(2,201)	$—	$—	$10,225	$231,160	$5,003	$—
Corporate debt securities ......................	25,925	2,547	18,805	(15,740)	(2,177)	—	15,322	44,682	2,194	—
CDOs and CLOs .......................................	71,827	(4,123)	35,644	(18,469)	(6,550)	—	(7,381)	70,948	(4,564)	—
RMBS ........................................................	7,526	436	—	—	(15)	—	—	7,947	439	—
CMBS ........................................................	471	34	—	—	—	—	—	505	34	—
Other ABS .................................................	147,319	6,814	27,523	(26,231)	(1,863)	—	119	153,681	5,985	—
Loans and other receivables .................	153,764	(7,236)	18,008	(39,475)	(13,063)	—	(19,830)	92,168	(10,875)	—
Investments at fair value ........................	157,881	6,041	261	—	(804)	—	(10,000)	153,379	3,581	—
Level 3 liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities ....................	$590	$(256)	$(173)	$—	$—	$—	$—	$161	$31	$—
Corporate debt securities ......................	1,113	222	(41,346)	41,436	(662)	—	(119)	644	(86)	—
RMBS ........................................................	15	(15)	—	—	—	—	—	—	—	—
CMBS ........................................................	1,154	(1)	—	35	—	—	(35)	1,153	1	—
Loans ........................................................	848	(658)	(37)	—	183	—	(23)	313	(226)	—
Net derivatives (2) ...................................	42,076	(1,132)	—	—	(4)	—	(7,652)	33,288	(6,385)	—
Other secured financings .......................	12,705	—	—	—	(2,360)	8,531	—	18,876	—	—
Long-term debt ........................................	860,684	34,729	—	—	(5,893)	93,570	8,066	991,156	(49,509)	14,781

	Six Months Ended May 31, 2025
$ in thousands	Balance at November 30, 2024	Total gains/ losses (realized and unrealized) (1)	Purchases	Sales	Settlements	Issuances	Net transfers into/ (out of) Level 3	Balance at May 31, 2025	For instruments still held at May 31, 2025, changes in  unrealized gains (losses) included in:
									Earnings (1)	Other comprehensive income (loss) (1)
Assets:
Financial instruments owned:
Corporate equity securities ................	$239,364	$9,940	$7,049	$(5,366)	$494	$—	$(20,321)	$231,160	$8,292	$—
Corporate debt securities ...................	24,931	2,147	37,129	(23,787)	(2,197)	—	6,459	44,682	2,419	—
CDOs and CLOs ...................................	63,976	(10,286)	52,875	(23,728)	(6,550)	—	(5,339)	70,948	(10,336)	—
Sovereign obligations .........................	172	2	—	(174)	—	—	—	—	—	—
RMBS .....................................................	7,714	269	—	—	(36)	—	—	7,947	279	—
CMBS ....................................................	477	28	—	—	—	—	—	505	28	—
Other ABS .............................................	103,214	(264)	86,866	(30,929)	(4,175)	—	(1,031)	153,681	(565)	—
Loans and other receivables ..............	152,586	(5,759)	72,851	(82,603)	(21,549)	3,670	(27,028)	92,168	(9,134)	—
Investments at fair value ....................	137,865	6,434	21,549	—	(2,469)	—	(10,000)	153,379	3,974	—
Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities ................	$208	$126	$(173)	$—	$—	$—	$—	$161	$(126)	$—
Corporate debt securities ...................	165	52	(135,198)	135,433	—	—	192	644	(123)	—
CMBS ....................................................	1,153	—	—	35	—	—	(35)	1,153	—	—
Loans ....................................................	16,864	(1,673)	(1,046)	—	698	—	(14,530)	313	39	—
Net derivatives (2) ...............................	22,286	(13,925)	—	22,588	(484)	—	2,823	33,288	5,076	—
Other secured financings ...................	14,884	241	—	—	(4,780)	8,531	—	18,876	(241)	—
Long-term debt ....................................	821,903	(21,118)	—	—	(2,799)	218,124	(24,954)	991,156	(19,522)	40,640

(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

Analysis of Level 3 Assets and Liabilities for the Three Months

Ended May 31, 2025

Transfers of assets of $31.5 million from Level 2 to Level 3 of the

fair value hierarchy are primarily attributed to:

•Corporate debt securities of $15.9 million, Corporate equity

securities of $11.1 million, Other ABS of $2.1 million and Loan

and other receivables of $1.6 million due to reduced pricing

transparency.

Transfers of assets of $43.0 million from Level 3 to Level 2 of the

fair value hierarchy are primarily attributed to:

•Loans and other receivables of $21.5 million, Investments at

fair value of $10.0 million, CDOs and CLOs of $8.0 million and

Other ABS of $2.0 million due to greater pricing transparency

supporting classification into Level 2.

Transfers of liabilities of $11.5 million from Level 2 to Level 3 of

the fair value hierarchy are primarily attributed to:

•Structured notes within Long-term debt of $13.2 million,

partially offset by net derivatives transfers into Level 3 of $2.0

million due to reduced market and pricing transparency.

Transfers of liabilities of $11.2 million from Level 3 to Level 2 of

the fair value hierarchy are primarily attributed to:

•Net derivatives of $5.7 million and structured notes within

Long-term debt of $5.1 million due to greater pricing and

market transparency.

Net gains on Level 3 assets were $12.8 million and net losses on

Level 3 liabilities were $32.9 million for the three months ended

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

increased market values across Corporate equity securities,

Other ABS, Investments at fair value and Corporate debt

securities, partially offset by decreased market values of Loans

and other receivables 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 Six Months Ended

May 31, 2025

Transfers of assets of $71.8 million from Level 2 to Level 3 of the

fair value hierarchy are primarily attributed to:

•Corporate equity securities of $30.3 million, Loan and other

receivables of $27.1 million, Corporate debt securities of $8.0

million, Other ABS of $3.3 million and CDOs and CLOs of $3.0

million due to reduced pricing transparency.

Transfers of assets of $129.0 million from Level 3 to Level 2 of

the fair value hierarchy are primarily attributed to:

•Loans and other receivables of $54.1 million, Corporate equity

securities of $50.7 million, Investments at fair value of

$10.0 million, CDOs and CLOs of $8.4 million and Other ABS of

$4.4 million due to greater pricing transparency supporting

classification into Level 2.

Transfers of liabilities of $7.9 million from Level 2 to Level 3 of

the fair value hierarchy are primarily attributed to:

•Net derivatives of $3.9 million and structured notes within

Long-term debt of $3.9 million due to reduced market and

pricing transparency.

Transfers of liabilities of $44.4 million from Level 3 to Level 2 of

the fair value hierarchy are primarily attributed to:

•Structured notes within Long-term debt of $28.8 million and

Loans of $14.5 million due to greater pricing and market

transparency.

Net gains on Level 3 assets were $2.5 million and net gains on

Level 3 liabilities were $36.3 million for the six months ended

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

increased market values across Corporate equity securities,

Investments at fair value and Corporate debt securities, partially

offset by decreased valuations of CDOs and CLOs and Loans and

other receivables. Net gains on Level 3 liabilities were primarily

due to decreased valuations of structured notes within Long-term

debt, certain derivatives and loans.

May 2025 Form 10-Q 17

Notes to Consolidated Financial Statements

	Three Months Ended May 31, 2024
$ in thousands	Balance at February 28, 2024	Total gains/ losses (realized and unrealized) (1)	Purchases	Sales	Settlements	Issuances	Net transfers into/ (out of) Level 3	Balance at May 31, 2024	For instruments still held at May 31, 2024, changes in unrealized gains (losses) included in:
									Earnings (1)	Other comprehensive income (loss) (1)
Assets:
Financial instruments owned:
Corporate equity securities .................	$173,214	$(12,751)	$15,398	$(18)	$—	$—	$2,912	$178,755	$(12,404)	$—
Corporate debt securities ...................	35,335	1,363	1,091	(16,250)	—	—	17,178	38,717	89	—
CDOs and CLOs ....................................	69,367	1,220	6,810	(1,905)	(5,527)	—	(1,339)	68,626	(675)	—
RMBS .....................................................	684	(6)	—	—	(34)	—	—	644	—	—
CMBS .....................................................	473	4	—	—	—	—	—	477	—	—
Other ABS ..............................................	102,256	(2,198)	63,554	(15,138)	(35,363)	—	55,625	168,736	(1,694)	—
Loans and other receivables ..............	78,885	1,255	11,329	(4,161)	(35)	—	5,273	92,546	579	—
Investments at fair value .....................	121,764	1,616	15,224	(547)	—	—	—	138,057	1,616	—
Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities .................	675	8	—	25	—	—	—	708	(8)	—
Corporate debt securities ...................	124	(23)	—	246	—	—	159	506	23	—
CMBS .....................................................	944	—	—	—	105	—	—	1,049	—	—
Loans .....................................................	1,466	(251)	(925)	2,801	81	—	(1,588)	1,584	309	—
Net derivatives (2) ................................	52,089	(10,062)	—	—	(9,689)	—	2,539	34,877	(178)	—
Other secured financings ....................	3,965	—	—	—	—	—	—	3,965	—	—
Long-term debt .....................................	779,529	(2,477)	—	—	(2,109)	6,616	2,653	784,212	9,334	(6,857)

	Six Months Ended May 31, 2024
$ in thousands	Balance at November 30, 2023	Total gains/ losses (realized and unrealized) (1)	Purchases	Sales	Settlements	Issuances	Net transfers into/ (out of) Level 3	Balance at May 31, 2024	For instruments still held at May 31, 2024, changes in unrealized gains (losses) included in:
									Earnings (1)	Other comprehensive income (loss) (1)
Assets:
Financial instruments owned:
Corporate equity securities ................	$181,294	$(12,817)	$15,956	$(2,230)	$—	$—	$(3,448)	$178,755	$(12,175)	$—
Corporate debt securities ...................	26,112	3,830	25,563	(17,217)	(200)	—	629	38,717	2,997	—
CDOs and CLOs ...................................	64,862	9,006	20,333	(15,838)	(7,293)	—	(2,444)	68,626	4,904	—
RMBS .....................................................	20,871	(207)	32	(32)	(5,395)	—	(14,625)	644	33	—
CMBS ....................................................	508	(35)	4	—	—	—	—	477	(64)	—
Other ABS .............................................	117,661	(5,913)	76,263	(32,817)	(26,619)	—	40,161	168,736	(3,938)	—
Loans and other receivables ..............	130,101	(39,831)	18,555	(3,974)	(17,892)	—	5,587	92,546	(17,220)	—
Investments at fair value ....................	130,835	(9,079)	16,855	—	(547)	—	(7)	138,057	(9,079)	—
Liabilities:
Financial instruments sold, not yet purchased:
Corporate equity securities	$676	$1	$—	$31	$—	$—	$—	$708	$(1)	$—
Corporate debt securities ...................	124	(23)	—	246	—	—	159	506	23	—
CMBS ....................................................	840	—	(245)	—	455	—	(1)	1,049	—	—
Loans ....................................................	1,521	(114)	(1,041)	3,642	114	—	(2,538)	1,584	107	—
Net derivatives (2) ...............................	50,955	(17,979)	(978)	2,913	(9,486)	—	9,452	34,877	9,057	—
Other secured financings ...................	3,898	4,482	—	—	(4,415)	—	—	3,965	(4,482)	—
Long-term debt ....................................	744,597	9,651	—	—	(2,109)	28,072	4,001	784,212	(5,117)	(4,534)

(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

Analysis of Level 3 Assets and Liabilities for the Three Months

Ended May 31, 2024

Transfers of assets of $99.2 million from Level 2 to Level 3 of the

fair value hierarchy are primarily attributed to:

•Other ABS of $61.9 million, Corporate debt securities of $17.3

million, Loan and other receivables of $11.4 million and

Corporate equity securities of $5.4 million due to reduced

pricing transparency.

Transfers of assets of $19.2 million from Level 3 to Level 2 of the

fair value hierarchy are primarily attributed to:

•Oher ABS of $6.3 million, Loans and other receivables of $6.2

million, CDOs and CLOs of $4.5 million and Corporate equity

securities of $2.5 million due to greater pricing transparency

supporting classification into Level 2.

Transfers of liabilities of $47.3 million from Level 2 to Level 3 of

the fair value hierarchy are primarily attributed to:

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

Net derivatives of $15.9 million due to reduced market and

pricing transparency.

Transfers of liabilities of $43.5 million from Level 3 to Level 2 of

the fair value hierarchy are primarily attributed to:

•Structured notes within Long-term debt of $30.1 million and

Net derivatives of $13.4 million due to greater pricing and

market transparency.

Net losses on Level 3 assets were $9.5 million and net gains on

Level 3 liabilities were $12.8 million for the three months ended

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

decreased market values across Corporate equity securities and

Other ABS, partially offset by increased valuations of Investments

at fair value, Corporate debt securities, Loans and other

receivables and CDOs and CLOs. Net gains on Level 3 liabilities

were primarily due to decreased valuations of certain derivatives

and structured notes within Long-term debt.

Analysis of Level 3 Assets and Liabilities for the Six Months Ended

May 31, 2024

Transfers of assets of $59.1 million from Level 2 to Level 3 of the

fair value hierarchy are primarily attributed to:

•Other ABS of $47.6 million, Loan and other receivables of $6.1

million, CDOs and CLOs of $2.7 million and Corporate debt

securities of $2.6 million due to reduced pricing transparency.

Transfers of assets of $33.3 million from Level 3 to Level 2 of the

fair value hierarchy are primarily attributed to:

•RMBS of $14.6 million, Other ABS of $7.4 million, CDOs and

CLOs of $5.1 million, Corporate equity securities of $3.6 million

and Corporate debt securities of $2.0 million due to greater

pricing transparency supporting classification into Level 2.

Transfers of liabilities of $62.0 million from Level 2 to Level 3 of

the fair value hierarchy are primarily attributed to:

•Structured notes within Long-term debt of $38.7 million and

Net derivatives of $23.2 million due to reduced market and

pricing transparency.

Transfers of liabilities of $50.9 million from Level 3 to Level 2 of

the fair value hierarchy are primarily attributed to:

•Structured notes within Long-term debt of $34.7 million and

Net derivatives of $13.7 million due to greater pricing and

market transparency.

Net losses on Level 3 assets were $55.0 million and net gains on

Level 3 liabilities were $4.0 million for the six months ended May

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

decreased market values across Loans and other receivables,

Corporate equity securities, Investments at fair value and Other

ABS, partially offset by increased valuations of CDOs and CLOs

and Corporate debt securities. Net gains on Level 3 liabilities

were primarily due to decreased valuations of certain derivatives,

partially offset by increased valuations of structured notes within

Long-term debt and Other secured financings.

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.

May 2025 Form 10-Q 19

Notes to Consolidated Financial Statements

May 31, 2025
Financial Instruments Owned	Fair Value (in thousands)	Valuation Technique	Significant Unobservable Input(s)	Input / Range			Weighted Average
Corporate equity securities .....................	$205,389
Non-exchange-traded securities		Market approach	Price	$0	-	$486	$80
Corporate debt securities ........................	$38,700	Market approach	Price	$49	-	$118	$52
		Discounted cash flows	Discount rate/yield	18%	-	26%	21%
CDOs and CLOs ..........................................	$63,639	Discounted cash flows	Constant prepayment rate	20%			—
			Constant default rate	2%			—
			Loss severity	30%			—
			Discount rate/yield	13%	-	19%	17%
		Market approach	Price	$98	-	$114	$105
RMBS ...........................................................	$7,947	Discounted cash flows	Constant prepayment rate	40%			—
			Loss severity	90%			—
			Discount rate/yield	18%			—
Other ABS ...................................................	$152,664	Discounted cash flows	Discount rate/yield	10%	-	29%	19%
			Cumulative loss rate	11%	-	34%	17%
			Duration (years)	0.6	-	1.2	1.0
		Market approach	Price	$114	-	$135	$122
		Scenario analysis	Estimated recovery percentage	83%			—
Loans and other receivables ...................	$92,168	Market approach	Price	$8	-	$114	$92
		Scenario analysis	Estimated recovery percentage	17%	-	251%	91%
Derivatives ..................................................	$4,701
Embedded options		Market approach	Basis points upfront	0.3			—
Investments at fair value ..........................	$148,059
Private equity securities		Market approach	Price	$0	-	$9,133	$1,704
			Discount rate/yield	28%			—
			Estimated revenue	$29,733,947			—
Financial Instruments Sold, Not Yet Purchased:
Derivatives ..................................................	$40,701
Equity options		Volatility benchmarking	Volatility	49%	-	51%	50%
Options		Market approach	Basis points upfront	0.0	-	23.8	15.6
Other secured financings .........................	$18,876	Scenario analysis	Estimated recovery percentage	76%	-	100%	96%
		Market approach	Price	$112	-	$117	$114
Long-term debt ..........................................	$990,274
Structured notes		Market approach	Price	$66	-	$116	$97

20 Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

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

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 May 31, 2025

and November 30, 2024, asset exclusions consisted of $49.8

million and $23.9 million, respectively, primarily composed of

Corporate equity securities, CDOs and CLOs, Corporate debt

securities, Investments at fair value, certain derivatives, Other

ABS and CMBS. At May 31, 2025 and November 30, 2024, liability

exclusions consisted of $4.3 million and $2.7 million,

respectively, primarily composed of CMBS, certain derivatives,

structured notes within Long-term debt, loans, 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 or structured

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

May 2025 Form 10-Q 21

Notes to Consolidated Financial Statements

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.

•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  May 31,		Six Months Ended  May 31,
$ in thousands	2025	2024	2025	2024
Financial instruments owned:
Loans and other receivables (1) .	$69,578	$(28,264)	$103,854	$(39,691)
Other secured financings:
Other changes in fair value (1) ...	$(1,418)	$—	$(1,659)	$(4,482)
Long-term debt:
Changes in instrument-specific credit risk (2) ............................	$28,763	$(13,790)	$66,501	$(17,769)
Other changes in fair value (1) ...	13,225	16,367	27,548	(27,451)

(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	May 31,  2025	November 30, 2024
Financial instruments owned:
Loans and other receivables (1) ...............................	$1,635,461	$1,603,512
Loans and other receivables on nonaccrual status and/or 90 days or greater past due (1) (2) ...............................................................	135,253	132,838
Long-term debt ...........................................................	266,641	131,107
Other secured financings .........................................	(1,200)	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 $50.3 million and $48.8

million at May 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 $68.4

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

2024, respectively, which includes loans and other receivables 90

days or greater past due of $60.0 million and $120.0 million at

May 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 six

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

above. During the six months ended May 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

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

impairments and downward adjustments on these investments

during the three and six months ended May 31, 2025 and 2024.

22 Jefferies Financial Group Inc.

Notes to Consolidated Financial Statements

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.

	May 31, 2025 (1)
	Assets		Liabilities
$ in thousands	Fair Value	Number of Contracts (2)	Fair Value	Number of Contracts (2)
Derivatives designated as accounting hedges:
Interest rate contracts:
Cleared OTC ........................................	$1,712	3	$—	—
Foreign exchange contracts:
Bilateral OTC .......................................	1,862	1	55,950	3
Total derivatives designated as accounting hedges ............................	3,574		55,950
Derivatives not designated as accounting hedges:
Interest rate contracts:
Exchange-traded ................................	536	46,274	—	23,687
Cleared OTC ........................................	329,900	7,826	331,751	8,253
Bilateral OTC .......................................	329,124	1,167	682,976	1,365
Foreign exchange contracts:
Bilateral OTC .......................................	161,844	37,567	136,950	12,957
Equity contracts:
Exchange-traded ................................	1,815,569	2,837,638	1,023,820	1,617,971
Bilateral OTC .......................................	1,293,083	34,451	1,521,811	32,884
Commodity contracts:
Exchange-traded ................................	1	903	234	823
Bilateral OTC .......................................	4,252	9,900	1,475	4,372
Credit contracts:
Cleared OTC ........................................	1,493	52	10,827	6
Bilateral OTC .......................................	64,928	9	44,410	23
Total derivatives not designated as accounting hedges .......................	4,000,730		3,754,254
Total gross derivative assets/ liabilities:
Exchange-traded ................................	1,816,106		1,024,054
Cleared OTC ........................................	333,105		342,578
Bilateral OTC .......................................	1,855,093		2,443,572
Amounts offset in our Consolidated Statements of Financial Condition (3):
Exchange-traded ................................	(981,970)		(981,970)
Cleared OTC ........................................	(330,271)		(339,425)
Bilateral OTC .......................................	(1,403,577)		(1,766,083)
Net amounts per Consolidated Statements of Financial Condition (4) .................................	$1,288,486		$722,726

(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.

May 2025 Form 10-Q 23

Notes to Consolidated Financial Statements

	November 30, 2024 (1)
	Assets		Liabilities
$ in thousands	Fair Value	Number of Contracts (2)	Fair Value	Number of Contracts (2)
Derivatives designated as accounting hedges:
Interest rate contracts:
Cleared OTC .........................................	$3,396	3	$—	—
Foreign exchange contracts:
Bilateral OTC ........................................	41,903	3	—	—
Total derivatives designated as accounting hedges .............................	45,299		—
Derivatives not designated as accounting hedges:
Interest rate contracts:
Exchange-traded .................................	273	16,548	13	32,984
Cleared OTC .........................................	1,030,842	6,663	1,030,671	6,891
Bilateral OTC ........................................	365,678	1,096	717,255	1,256
Foreign exchange contracts:
Bilateral OTC ........................................	132,240	57,786	138,608	35,545
Equity contracts:
Exchange-traded .................................	682,327	1,777,822	521,889	1,574,498
Bilateral OTC ........................................	855,169	33,516	1,024,129	20,587
Commodity contracts:
Exchange-traded .................................	22	806	17	697
Bilateral OTC .......................................	4,570	11,691	1,381	5,180
Credit contracts:
Cleared OTC .........................................	31,488	66	38,711	32
Bilateral OTC ........................................	37,618	16	31,353	32
Total derivatives not designated as accounting hedges .............................	3,140,227		3,504,027
Total gross derivative assets/ 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 Consolidated Statements of 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 Statements of Financial Condition (4) ..................................	$517,775		$710,314

(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 May 31,		Six Months Ended May 31,
Gains (Losses)	2025	2024	2025	2024
Interest rate swaps (1) ..................	$(415)	$(26,253)	$(6,043)	$(30,811)
Long-term debt ...............................	(11,968)	10,282	(18,659)	(985)
Total .................................................	$(12,383)	$(15,971)	$(24,702)	$(31,796)

(1)Includes net settlements of $12.2 million and $24.1 million for the three and

six months ended May 31, 2025, respectively, and $16.1 million and $32.0

million for the three and six months ended May 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 May 31,		Six Months Ended May 31,
Gains (Losses)	2025	2024	2025	2024
Foreign exchange contracts .........	$(90,986)	$(10,925)	$(74,132)	$(8,808)
Total .................................................	$(90,986)	$(10,925)	$(74,132)	$(8,808)

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 May 31,		Six Months Ended May 31,
Gains (Losses)	2025	2024	2025	2024
Interest rate contracts ...................	$(8,710)	$36,783	$(31,212)	$58,505
Foreign exchange contracts .........	21,645	42,363	16,770	32,529
Equity contracts ..............................	823,950	50,298	1,318,166	(259,358)
Commodity contracts ....................	7,723	14,332	13,457	18,432
Credit contracts ..............................	653	(8,769)	1,704	(13,342)
Total .................................................	$845,261	$135,007	$1,318,885	$(163,234)

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

OTC Derivatives

Remaining contract maturities at May 31, 2025:

	OTC Derivative Assets (1) (2) (3)
$ in thousands	0 – 12 Months	1 – 5 Years	Greater Than 5 Years	Cross- Maturity Netting (4)	Total
Commodity swaps, options and forwards ......................................	$4,031	$—	$—	$—	$4,031
Equity options and forwards ..........	238,135	872	—	(389)	238,618
Credit default swaps .......................	—	—	21,592	(106)	21,486
Total return swaps ...........................	147,772	57,728	181	(2,269)	203,412
Foreign currency forwards, swaps and options .................................	68,897	992	—	—	69,889
Fixed income forwards ...................	42,666	—	—	—	42,666
Interest rate swaps, options and forwards ......................................	52,418	142,873	32,691	(31,415)	196,567
Total ...................................................	$553,919	$202,465	$54,464	$(34,179)	776,669
Cross-product counterparty netting ..........................................					(37,916)
Total OTC derivative assets included in Financial instruments owned ....................					$738,753

	OTC Derivative Liabilities (1) (2) (3)
$ in thousands	0 – 12 Months	1 – 5 Years	Greater Than 5 Years	Cross- Maturity Netting (4)	Total
Commodity swaps, options and forwards ......................................	$1,376	$—	$—	$—	$1,376
Equity options and forwards ..........	208,093	88,727	13,726	(389)	310,157
Credit default swaps ........................	714	753	9,680	(106)	11,041
Total return swaps ...........................	271,638	131,091	—	(2,269)	400,460
Foreign currency forwards, swaps and options .................................	98,657	427	—	—	99,084
Fixed income forwards ...................	528	—	—	—	528
Interest rate swaps, options and forwards ......................................	34,901	85,465	463,024	(31,415)	551,975
Total ...................................................	$615,907	$306,463	$486,430	$(34,179)	1,374,621
Cross-product counterparty netting ..........................................					(37,916)
Total OTC derivative liabilities included in Financial instruments sold, not yet purchased ...................................					$1,336,705

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

with a fair value of $834.1 million and $42.1 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 May 31,

2025, cash collateral received and pledged was $284.4 million and $656.1

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 May 31, 2025:

Counterparty credit quality (1):	$ in thousands
A- or higher ...............................................................................................	$246,263
BBB- to BBB+ ...........................................................................................	29,767
BB+ or lower .............................................................................................	194,209
Unrated .....................................................................................................	268,514
Total ..........................................................................................................	$738,753

(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:

	May 31, 2025
	External Credit Rating
$ in millions	Investment Grade	Non- investment Grade	Total Notional
Credit protection sold:
Index credit default swaps .....................	$63.2	$743.8	$807.0

	November 30, 2024
	External Credit Rating
$ in millions	Investment Grade	Non- investment Grade	Total 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	May 31, 2025	November 30, 2024
Derivative instrument liabilities with credit-risk- related contingent features ....................................	$197.3	$102.3
Collateral posted ...........................................................	(105.6)	(50.6)
Collateral received ........................................................	297.8	296.1
Return of and additional collateral required in the event of a credit rating downgrade below investment grade (1) ...............................................	389.5	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.

May 2025 Form 10-Q 25

Notes to Consolidated Financial Statements

Note 8. Collateralized Transactions

	May 31, 2025
$ in millions	Securities Lending Arrangements	Repurchase Agreements	Obligation to Return Securities Received as Collateral, at Fair Value	Total
Collateral Pledged:
Corporate equity securities .....................	$1,555.0	$1,823.9	$—	$3,378.9
Corporate debt securities .....................	371.6	4,196.9	—	4,568.5
Mortgage-backed and asset-backed securities .....................	—	2,133.0	—	2,133.0
U.S. government and federal agency securities .....................	84.4	9,169.2	—	9,253.6
Municipal securities ........	—	467.7	—	467.7
Sovereign obligations .....	30.8	2,061.4	51.0	2,143.2
Loans and other receivables ..................	—	692.9	—	692.9
Total ..................................	$2,041.8	$20,545.0	$51.0	$22,637.8

	November 30, 2024
$ in millions	Securities Lending Arrangements	Repurchase Agreements	Obligation to Return Securities Received as Collateral, at Fair Value	Total
Collateral Pledged:
Corporate equity securities .....................	$2,059.8	$1,394.2	$3.9	$3,457.8
Corporate debt securities .....................	416.4	4,522.5	—	4,938.9
Mortgage-backed and asset-backed securities .....................	—	2,384.8	—	2,384.8
U.S. government and federal agency 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 receivables ..................	—	757.4	—	757.4
Total ..................................	$2,540.9	$18,088.9	$185.6	$20,815.4

	May 31, 2025
$ in millions	Overnight and Continuous	Up to 30 Days	31-90 Days	Greater than 90 Days	Total
Securities lending arrangements ..............	$1,474.5	$76.1	$195.0	$296.2	$2,041.8
Repurchase agreements .	2,431.4	10,216.6	3,879.2	4,017.8	20,545.0
Obligation to return securities received as collateral, at fair value .............................	51.0	—	—	—	51.0
Total ...................................	$3,956.9	$10,292.7	$4,074.2	$4,314.0	$22,637.8

	November 30, 2024
$ in millions	Overnight and Continuous	Up to 30 Days	31-90 Days	Greater than 90 Days	Total
Securities lending 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 securities received as collateral, at fair 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 May 31, 2025 and

November 30, 2024, the approximate fair value of securities

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

$45.53 billion and $37.63 billion, respectively. At May 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

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).

	May 31, 2025
$ in millions	Gross Amounts	Netting in Consolidated Statements of Financial Condition	Net Amounts in Consolidated Statements of Financial Condition	Additional Amounts Available for Setoff (1)	Available Collateral (2)	Net Amount (3)
Assets:
Securities borrowing arrangements ...................................	$7,844.8	$—	$7,844.8	$(585.4)	$(1,769.1)	$5,490.3
Reverse repurchase agreements .........................................	15,872.4	(8,387.4)	7,485.0	(1,479.4)	(5,919.8)	85.8
Securities received as collateral, at fair value ...................	51.0	—	51.0	—	(51.0)	—
Liabilities:
Securities lending arrangements ........................................	$2,041.8	$—	$2,041.8	$(585.4)	$(1,408.1)	$48.3
Repurchase agreements .......................................................	20,545.0	(8,387.4)	12,157.6	(1,479.4)	(10,039.6)	638.6
Obligation to return securities received as collateral, at fair value .............................................................................	51.0	—	51.0	—	(51.0)	—

	November 30, 2024
$ in millions	Gross Amounts	Netting in Consolidated Statements of Financial Condition	Net Amounts in Consolidated Statements of Financial Condition	Additional Amounts Available for Setoff (1)	Available Collateral (2)	Net 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 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 $5.41 billion of securities borrowing arrangements, for which we have received securities collateral of $5.38 billion, and $560.0 million of repurchase

agreements, for which we have pledged securities collateral of $573.1 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.

May 2025 Form 10-Q 27

Notes to Consolidated Financial Statements

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	May 31,  2025	November 30, 2024
Cash and securities segregated and on deposit for regulatory purposes or deposited with clearing and depository organizations ..................................................	$1,051.3	$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 May 31,		Six Months Ended May 31,
$ in millions	2025	2024	2025	2024
Transferred assets .....................	$2,591.4	$1,910.0	$2,633.4	$3,412.0
Proceeds on new securitizations .......................	2,591.4	1,910.0	2,633.4	3,412.0
Cash flows received on retained interests ..................	6.5	9.0	11.1	19.1

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

May 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	May 31, 2025		November 30, 2024
Securitization Type	Total Assets	Retained Interests	Total Assets	Retained Interests
U.S. government agency RMBS ...	$2,045.0	$18.6	$3,956.8	$105.7
U.S. government agency CMBS ...	1,345.2	48.0	1,817.1	91.8
CLOs .................................................	10,416.7	60.2	9,001.9	37.2
Consumer and other loans ...........	1,674.3	58.7	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

•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:

	May 31, 2025 (1)
$ in millions	Secured Funding Vehicles	Other
Cash ...................................................................................	$—	$16.8
Financial instruments owned ........................................	—	56.6
Securities purchased under agreements to resell (2)	3,336.9	—
Receivables from brokers (3) .........................................	—	21.3
Other receivables .............................................................	—	3.1
Other assets (4) ...............................................................	—	88.6
Total assets ......................................................................	$3,336.9	$186.4
Financial instruments sold, not yet purchased ...........	$—	$10.6
Other secured financings (5) .........................................	3,333.2	29.9
Other liabilities (6) ...........................................................	5.1	25.9
Long-term debt ................................................................	—	70.1
Total liabilities .................................................................	$3,338.3	$136.5

	November 30, 2024 (1)
$ in millions	Secured Funding 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)$0.8 million and $1.5 million of receivables from brokers at May 31, 2025 and

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

are eliminated in consolidation.

(4)$3.6 million and $3.4 million of the other assets at May 31, 2025 and

November 30, 2024, respectively, represent intercompany receivables with

related consolidated entities, which are eliminated in consolidation.

(5)$734.0 million and $719.0 million of the other secured financings at May 31,

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

entities and are eliminated in consolidation.

(6)$24.8 million and $22.0 million of the other liabilities amounts at May 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.

May 2025 Form 10-Q 29

Notes to Consolidated Financial Statements

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

	May 31, 2025
	Carrying Amount		Maximum Exposure to Loss	VIE Assets
$ in millions	Assets	Liabilities
CLOs ......................................	$969.6	$42.2	$4,843.7	$15,080.2
Asset-backed vehicles ........	734.3	—	994.9	3,601.2
Related party private equity vehicles ............................	3.4	—	15.0	40.7
Other investment vehicles ..	1,385.4	—	1,606.3	30,032.9
Total .......................................	$3,092.7	$42.2	$7,459.9	$48,755.0

	November 30, 2024
	Carrying Amount		Maximum Exposure to 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 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, (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 May 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 $2.8 million and $3.2

million at May 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 May 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 May 31, 2025