Houlihan Lokey, Inc. (HLI): ANSOFF MATRIX [Dec-2025 Updated]

Honestly, when you're trying to map out the next big growth phase for a firm like Houlihan Lokey, Inc. (HLI), you need more than just vague ideas; you need a clear plan, and their strategy is definitely laid out here. We're looking at how they plan to build on their $2.39 billion Corporate Finance revenue from FY2025, not just by squeezing more out of each Managing Director-who already pull in $7.0 million-but by taking their Financial Restructuring services, which grew 4%, into new markets and developing entirely new offerings, like that proprietary Private Credit DataBank. From deepening sponsor relationships to exploring full diversification by acquiring asset managers, this matrix shows you exactly where the next dollar is coming from across their 33 global locations. Let's dive into the four clear paths ahead.

Houlihan Lokey, Inc. (HLI) - Ansoff Matrix: Market Penetration

You're looking at how Houlihan Lokey, Inc. (HLI) can sell more of its existing services into its existing client base. This is about digging deeper where you already have a foothold. The numbers from fiscal year 2025 show a strong foundation to build upon for this strategy.

The primary goal here is to increase Corporate Finance revenue, which the firm has targeted to hit $2.39 billion in FY2025, building on the segment's strong performance. To support this, you need to maximize the output from your existing talent pool. In FY2025, Houlihan Lokey, Inc. achieved a revenue per Managing Director (MD) of $7.0 million. With a reported headcount of 339 managing directors in 2025, the focus shifts to increasing that productivity metric further, perhaps through better cross-selling or higher deal volume per MD.

Cross-selling Financial Restructuring (FR) services to existing Corporate Finance (CF) clients is a key lever. While the CF segment saw robust growth, the FR segment grew its revenues by 4% in FY2025 compared to the prior year. This suggests there's room to convert more CF clients who might only use M&A advisory into users of restructuring services, or vice versa, to capture more wallet share.

Deepening relationships with financial sponsors remains critical, as they drive a substantial part of the deal flow. As of the end of fiscal year 2024, Houlihan Lokey, Inc. closed over 200 M&A transactions involving private equity clients out of over 300 global M&A transactions closed. This suggests that approximately 66.7% of global M&A deal flow came from financial sponsors in 2024, a relationship base that needs constant nurturing. The Financial Sponsors Group managed approximately 1,900 relationships as of FYE 2024.

To immediately gain market share in core sectors, strategic acquisitions are a direct path. Houlihan Lokey, Inc. has a history of using this tactic; for example, they acquired GCA Corporation in October 2021 and Fidentiis Capital in 2019. In total, the firm has completed 15 acquisitions, with 2 completed in 2024.

Here's a look at the key productivity and growth metrics related to this market penetration effort:

The focus on existing markets means maximizing the value derived from current client interactions. Consider the service mix you are promoting:

• Cross-sell Financial Restructuring (FR) services to existing Corporate Finance (CF) clients.
• Deepen relationships with financial sponsors, who drove over 200 M&A transactions in 2024.
• Increase Managing Director (MD) productivity from the $7.0 million per MD achieved in FY2025.
• Target the middle-market M&A space to grow the Corporate Finance segment.
• Acquire smaller, specialized boutique firms to immediately gain market share.

Houlihan Lokey, Inc. (HLI) - Ansoff Matrix: Market Development

You're looking to expand Houlihan Lokey, Inc. (HLI)'s existing service lines into new geographic markets or new client segments, which is the essence of Market Development in the Ansoff Matrix.

The firm's global platform currently spans 33 locations worldwide, providing a base for aggressive cross-border M&A pitches.

Focusing on the Capital Solutions Group (CSG) in EMEA, the strategic hire of Sandro Galfetti in Zurich is aimed directly at building out GP-led secondary transaction advisory capabilities. The CSG, as of June 30, 2025, comprised more than 170 dedicated professionals across 16 offices in seven countries, having advised on around $28 billion across approximately 120 transactions in the preceding 12 months. The Equity Capital Solutions team, which includes the Zurich focus, has approximately 40 dedicated financial professionals across New York, San Francisco, London, Paris, and Zurich.

Domestically, establishing a physical presence in high-growth US regions is a clear action. Houlihan Lokey, Inc. (HLI) has a presence in Miami, which is listed among its Americas offices, and this location is being reinforced with senior talent, such as the Managing Director hire focused on GP-led transactions and financial sponsor-backed clients.

Targeting new client demographics involves leveraging existing service lines with institutions that require sophisticated advisory. The firm already possesses deep, proprietary investor relationships with direct investors, including family offices, and sovereign wealth funds. In 2023, accomplishments with sponsors included coverage of 70 Family Offices.

The Asia-Pacific region focus is supported by existing offices in Singapore, Hong Kong, and Tokyo, and recent recognition highlights success in this area, with Houlihan Lokey Japan ranked No. 1 in MARR's Financial Advisor Ranking Survey in October 2025.

The firm's overall financial performance provides the resources for this expansion. Full fiscal year 2025 revenues reached $2.4 billion. For the twelve months ending September 30, 2025, revenue was $2.57B, representing a 21.01% increase year-over-year. Corporate Finance, the segment most directly tied to M&A advisory, generated $1.53 B USD in revenue for the last year (FY ended March 31, 2025).

Here are key metrics supporting the global platform for cross-border pitches:

The firm's commitment to expanding its advisory capabilities is evident in the growth of its specialized teams and geographic reach. For instance, the Financial Services Group has over 80 dedicated financial professionals across five offices, including Tokyo.

The strategic focus areas for Market Development can be summarized:

• Expand Capital Solutions Group in EMEA, building on the Zurich hire for GP-led secondary transactions.
• Establish physical offices in high-growth US regions like Miami, focusing on private capital sponsor clients.
• Target sovereign wealth funds and large family offices with existing advisory services; 70 family offices covered in 2023 sponsor deals.
• Increase focus on Asia-Pacific, leveraging Singapore, Hong Kong, and Tokyo offices; Japan ranked No. 1 M&A Advisor by MARR in October 2025.
• Use the 33 locations global platform to pitch cross-border M&A deals more aggressively.

The firm's Corporate Finance segment generated $1.53 B USD in revenue in the last fiscal year, providing the financial strength to support these geographic and client segment expansions.

Houlihan Lokey, Inc. (HLI) - Ansoff Matrix: Product Development

You're looking at how Houlihan Lokey, Inc. is pushing new services into its existing client base, which is the essence of Product Development in the Ansoff Matrix. This isn't just about tweaking old advice; it's about launching proprietary tools and formalizing new advisory lines, which directly impacts the Financial and Valuation Advisory (FVA) segment, which saw revenues increase by 11% for the fiscal year ended March 31, 2025, compared to the prior year.

Launch the proprietary Private Credit DataBank as a new, high-value subscription service for existing Financial and Valuation Advisory (FVA) clients.

Houlihan Lokey, Inc. announced the launch of the Houlihan Lokey Private Credit DataBank on November 4, 2025. This proprietary dataset and analytics platform is sourced from the firm's recurring portfolio valuation work, capturing observations from more than 60,000 loan valuations. The dataset includes observations dating back to 2017 and is updated continuously. Each loan record within the DataBank contains more than 200 standardized data fields, covering terms, covenants, fair value metrics like yield and spread, and credit metrics such as leverage and LTV.

Develop new advisory offerings around AI-driven software and digital infrastructure, building on recent Technology Group hires.

The focus on technology, including AI-driven optimization, is evident in sector activity. For instance, M&A transaction activity across the Industrial Software sector increased by 31% in the first half of 2025 compared to the first half of 2024. The firm's FinTech Group continues to advise on engagements across Capital Markets Technology, covering areas like Fixed-Income Trading Technology and Mortgage Software and Data.

Create a dedicated 'Capital Solutions' product for middle-market companies seeking non-traditional debt and equity financing.

The Capital Solutions Group is a significant operational component supporting this product line. As of September 30, 2025, this group comprised more than 170 professionals globally and had raised approximately $28 billion in capital over the preceding twelve months (LTM). In the LTM ending September 30, 2025, the group closed over 120 transactions.

Enhance the Financial Restructuring product suite to include pre-emptive liability management and distressed M&A advisory.

The Financial Restructuring (FR) segment showed growth, with revenues increasing by 4% for the full fiscal year 2025 compared to fiscal year 2024. This segment maintains high productivity, with revenue per managing director reported at $9.5 million. The inclusion of pre-emptive liability management strengthens the suite, which already includes Distressed M&A advisory.

Formalize a new ESG (Environmental, Social, and Governance) advisory product for M&A and valuation clients.

The firm's Environmental Services practice is a proxy for this focus, having advised on over 100+ closed transactions, with more than 35 of those occurring since the start of 2023. Furthermore, the Houlihan Lokey Environmental Services Index posted a strong 8.9% gain in Q2 2025 and is up 12.1% over the trailing twelve months ending June 30, 2025, reflecting durable sector performance.

Here's a quick look at the firm's overall financial scale during this product development period:

The expansion into data products and specialized advisory is designed to deepen engagement with the existing client base across all three core service lines:

• Launch of DataBank supports FVA clients with loan-level insights.
• Technology advisory builds on expertise in Corporate Finance and FVA.
• Capital Solutions group has 170+ professionals.
• Enhanced Financial Restructuring suite leverages high productivity ($9.5 million revenue per MD).
• Formalized ESG advisory builds on 100+ deals advised since 2023.

Finance: draft the Q1 FY2026 budget allocation for Technology Group expansion by end of Q4 reporting.

Houlihan Lokey, Inc. (HLI) - Ansoff Matrix: Diversification

You're looking at how Houlihan Lokey, Inc. (HLI) is moving beyond its core advisory strengths to build new revenue streams. This diversification strategy aims to capture growth in adjacent or entirely new markets, which is key when core M&A cycles slow down. For instance, the firm posted record Fiscal Year 2025 revenues of $2.39 billion, up 25% from the prior year, showing the power of its existing three-pillar structure, but new growth requires new vectors.

The Financial and Valuation Advisory (FVA) segment, which represented 13% of the firm's revenue in FY2025, is a clear launchpad for integrating specialized services. The acquisition of Prytania Solutions Ltd. in October 2024, which specializes in structured credit valuations and analytics using machine learning, is a direct move to bolster this area. This acquisition is intended to integrate its structured credit and automated valuation services into a new asset management division. To see the current scale of the FVA business you're building upon, Q2 Fiscal Year 2026 revenues for FVA were $79 million, up 16% year-over-year from the $68 million reported in Q1 Fiscal Year 2025.

Here's a look at the current revenue base that these diversification efforts are layered upon, based on the Fiscal Year 2025 breakdown:

Expanding into the private wealth management market via acquiring a small, specialized asset management firm targets a new client segment entirely. While the specific financial metrics of such an acquisition aren't public yet, consider the scale of the firm's human capital: Houlihan Lokey, as of July 2025, had 347 managing directors across 33 locations worldwide. Adding a private wealth component means leveraging this MD base into a new fee structure.

Developing a new consulting service line focused on regulatory compliance and risk management for financial institutions is a move to stabilize advisory revenue outside of transaction cycles. The firm's existing strength in Financial Restructuring, which saw revenues of $165 million in Q4 Fiscal Year 2025, suggests deep expertise in navigating complex regulatory environments that can be productized into a consulting offering. This is about creating recurring, non-event-driven revenue.

Launching a dedicated fund to co-invest alongside clients creates a principal investing revenue stream. This is a shift from pure advisory fees to taking on balance sheet risk. The Corporate Finance segment, which is the largest at 64% of FY2025 revenue, is the logical feeder for these mid-market transactions. For context, in Q4 Fiscal Year 2025, Corporate Finance revenues were $413 million, up 44% year-over-year, showing strong deal flow potential to seed such a fund.

Targeting the municipal finance market by acquiring a public finance advisory team is a sector-specific market development. This new sector entry diversifies away from the firm's core M&A and restructuring focus. The firm's overall commitment to shareholder returns, evidenced by the 5% increase in the quarterly dividend to $0.60 per share, suggests management is confident that these diversification efforts will ultimately enhance distributable earnings.

The strategic moves for diversification can be summarized by the new focus areas and the existing scale they aim to augment:

• Integrate structured credit/automated valuation services from the October 2024 acquisition into a new asset management division, building on the 13% FVA revenue base.
• Acquire a specialized firm to enter private wealth management, leveraging the 347 managing directors.
• Develop a regulatory compliance and risk management consulting service, drawing from the expertise that supported 88 distressed debt and bankruptcy restructuring deals in CY 2024.
• Launch a dedicated co-investment fund, feeding off the $413 million in Corporate Finance revenue generated in Q4 Fiscal Year 2025.
• Target the municipal finance sector by acquiring a public finance advisory team, expanding beyond the 2,000+ clients served annually.

Finance: draft 13-week cash view by Friday.