Aon PLC Q2 2025 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Jimmy Bhullar - JPMorgan Chase & Co - Analyst : So first, just a question for Greg on the contribution to growth from capital markets activities and new hires. On new hires, I think Edmund had outlined at Investor Day that the contribution should pick up as you go through this year. So assuming that hasn't changed and -- but you could comment if it has? And then on Capital Markets, not sure if you're seeing, or expecting a greater impact in the third and the fourth quarters versus what you've seen in the first half, given that it looks like M&A IPO activity across the board is picking up in several industries?

Question: Jimmy Bhullar - JPMorgan Chase & Co - Analyst : Thanks. And maybe just a question on your preferred uses of free cash flow. You mentioned deleveraging as you had outlined at the end with the NFP deal. But just maybe comment on your interest in large M&A. It seems like the antitrust environment better than it was before, and some of your peers have done larger deals since you did the NFP acquisition. But just your interest in large-scale M&A as a use of capital?

Question: Jimmy Bhullar - JPMorgan Chase & Co - Analyst : Thank you.

Question: Elyse Greenspan - Wells Fargo Securities LLC - Analyst : My first question is also on the M&A transactional book. I was just wondering, is it overweight on any geography, or industry vertical? Or is it pretty diversified? And then directionally, is the margin better or worse than the core P&C margin within the Commercial Risk segment?

Question: Elyse Greenspan - Wells Fargo Securities LLC - Analyst : Thanks. And then my second question. I was hoping you could spend a little bit more time on what drove the pretty strong free cash flow growth in the quarter? And then I know the full-year guide is for $300 million from NFP free cash flow. Where do we sit through the first half of the year?

Question: Elyse Greenspan - Wells Fargo Securities LLC - Analyst : Thank you.

Question: Andrew Kligerman - Cowen and Company LLC - Analyst : So back when you closed on the NFP deal about a year -- a year plus, the talk was of the expectation of generating about 175 (inaudible) coupled with about $60 million in cost synergies. And I think, Edmund, you mentioned that this year, you're on track for $80 million in revenue synergies. So looking out to 2026, how are you progressing there? What can we expect along these numbers? Maybe -- any specific numbers you could provide around these metrics as we look to the incremental upside in 2026?

Question: Andrew Kligerman - Cowen and Company LLC - Analyst : Got it. And then just second question is around Reinsurance Solutions. You talked about double-digit increases in ILS and facultative placements. How should we think about the dynamic with Treaty? Is that kind of taking from Treaty? Or do you see kind of an uplift in both? Like how should we think about that dynamic between the two product areas ILS and Treaty?

Question: Andrew Kligerman - Cowen and Company LLC - Analyst : Thanks. Very helpful.

Question: Robert Cox - Goldman Sachs Group Inc - Analyst : Just a question first on talent. The revenue-generating head count seems like it's up 6% year to date, and this push has been successful. I'm curious, has this changed your mind at all about the sort of run rate future investments in talent? And is this 4% to 8% increase annually sort of the right level to think about going forward? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JULY 25, 2025 / 12:30PM, AON.N - Q2 2025 Aon PLC Earnings Call

Question: Robert Cox - Goldman Sachs Group Inc - Analyst : That's great. Thanks for all the color there. And if I could just follow up on maybe a broader question on the economy. Broad strokes, what are you hearing from clients? And how are you thinking about growth in exposures in the back half of the year?

Question: Robert Cox - Goldman Sachs Group Inc - Analyst : That's great. Thanks for the answers. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JULY 25, 2025 / 12:30PM, AON.N - Q2 2025 Aon PLC Earnings Call

Question: David Motemaden - Evercore Inc - Analyst : Edmund, I was wondering if you could just size the tailwind to organic growth from the M&A services for both the total company and then specifically within Commercial Risk? And then maybe help us think about it. I understand it's not back yet, but if it were back, how much of a contribution could it have?

Question: David Motemaden - Evercore Inc - Analyst : Understood. Thank you for that. And I totally understand. On -- just a follow up on the 6% increase in revenue-generating roles through the first half, already at halfway through the full year -- the midpoint of the full-year goal. Maybe you could just talk about the talent pipeline and if you think there's maybe the potential to get above that 8% growth in revenue-generating roles that you guys had targeted for this year? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JULY 25, 2025 / 12:30PM, AON.N - Q2 2025 Aon PLC Earnings Call

Question: David Motemaden - Evercore Inc - Analyst : Great. Thank you.

Question: Meyer Shields - Keefe Bruyette & Woods Inc - Analyst : I was hoping to get an update on how sensitive clients of different sizes are to elevated social inflation, or legal risk in the US? I know on the insurance side, obviously, it's a major concern, but I'm wondering whether it's penetrating the broader [consciousness]?

Question: Meyer Shields - Keefe Bruyette & Woods Inc - Analyst : Okay. Fantastic. That's very helpful. And I want to go back to the talent question, just one more time because we've gone through, I think, these many waves in the industry where company X is hiring and so on. I think it's great. But I'm wondering how -- what's Aon doing to not so much recruit talent as to train it from scratch, or to grow it from scratch?

Question: Meyer Shields - Keefe Bruyette & Woods Inc - Analyst : That is very helpful. Thanks so much.