A&O Shearman partners see pay climb to $2.9M despite flat revenue

A&O Shearman has reported a 14% increase in pre-tax profits to $1.6 billion (£1.2 billion) for its second financial year since the merger of Allen & Overy and Shearman & Sterling. Despite broadly flat revenue, which slightly decreased to $3.7 billion (£2.8 billion) from £2.9 billion the previous year, profit per equity partner (PEP) saw a 12% rise, reaching an average of $2.9 million (£2.2 million).

Firm leaders attributed the improved profitability to a strategic reshaping and streamlining of operations, focusing on more profitable industries and complex mandates. The partnership size also reduced from approximately 740 to 710 partners over the year. Hervé Ekué, global managing partner, stated that the firm is more profitable with a stronger base for sustainable growth.

As the firm steps up its profitability push, stalling revenue and continued partner exits suggest it is still navigating the 'growing pains' of a merger.