The St. Petersburg, Florida-based company on Wednesday reported net income of $85.9 million, or 61 cents a share, in the fiscal first quarter ended Dec. 31, up from $67.3 million, or 53 cents, in the year-earlier period.
Excluding charges related to the company's takeover of Memphis-based Morgan Keegan from Regions Financial Corp, earnings rose 43 percent to $96.6 million, or 69 cents a share. Analysts on average had forecast earnings of 68 cents a share, according to Thomson Reuters I/B/E/S.
Net revenue rose 42 percent to $1.11 billion from a year earlier, above analyst expectations of $1.08 billion.
Year-over-year comparisons are skewed by the firm's $1.2 billion takeover of Morgan Keegan, which expanded its network of brokers by about 20 percent and added to Raymond James' fixed-income business.
Brokerage revenue rose 35 percent from the prior year to $712.8 million, fueled by strong recruiting activity of top advisers. Total client assets rose 45 percent to $392 billion, including roughly $22 billion in institutional assets.
The firm's ranks of U.S. advisers shrank by 25 during the quarter to a total of 5,427 at the end of December, which Raymond James attributed primarily to the attrition of lower-producing Morgan Keegan advisers.
"Retention levels remain extremely high for those Morgan Keegan advisers offered retention packages," the company said in a statement.
Including the UK, Canada and custody businesses, the firm had 6,289 advisers and representatives at the end of December.
Capital markets revenue surged 82 percent to $247.6 million, driven by strong mergers-and-acquisitions and underwriting activity.