The 2015 Am Law 100: Rich and Richer

The American Lawyer

It's been a surprisingly strong year for many of the nation's top-grossing firms, buoyed by the recovering U.S. economy and robust transactional and tech markets. There's a new No. 1 at the top of The Am Law 100. Gross revenue, revenue per lawyer, profits per partner and other metrics—including a new profit measure we introduce this year—showed solid gains overall; some firms saw double-digit increases in those measures. Growth at several firms was superficial (achieved, for example, by adding lawyers, which boosts revenue). Still, the richest firms got even richer.


Previous Am Law 100 coverage :: 2014 | 2013 | 2012 | 2011 | 2010 | 2009 | 2008

FEATURES & ANALYSIS

It was a year of solid gains for The Am Law 100, especially for a burgeoning group of top firms.
 
The firm is the fourth in 30 years to occupy the top spot on our gross revenue rankings.
 
The sudden exit of its future leader plus disappointing financials put The Am Law 100's oldest firm to the test.
 
To help add context to our reporting on law firm profits, this year's Am Law 100 report adds a new metric, profits per lawyer.
 
Most Am Law 100 firms had solid results in 2014, but some sector bets paid off especially well.
 
Profits Matter: A Defense of The Am Law 100
Financial transparency won't ruin the profession.
 
For those lawyers who like their data with a bit of fun and flair (and why not? It was a good year!) we offer the following take on this year's Am Law 100.
 
 
FIRMS OF NOTE
 
After a pair of down years, the firm posts a double-digit rise in profits.
A structural change at the firm helps widen profit gains.
Belt-tightening measures help boost the firm's profits.
The firm records a second year of double-digit profit growth.
An ignition-switch investigation propels the firm's growth.
After it wrapped up some big litigation cases, the firm's revenues and profit fall.
The firm's revenue growth continues, even as profits take a blow.
A 7 percent rise in profits pushes the firm over the threshold.
 
Methodology
How we report law firm financials.

BY THE NUMBERS

The Am Law 100: Firms Ranked By Gross Revenue
Twenty-seven firms posted gross revenue of $1 billion or more in 2014, up from 23 in 2013. Eighty firms reported gains in gross revenue. Two Silicon Valley firms, Fenwick & West and Cooley, posted the biggest gains at 19.1 and 19.0 percent, respectively. Bingham McCutchen, which ceased operations in late 2014, had the steepest decline, 12.7 percent.
 
 
 
INTERACTIVE CHARTS
 
How Firm Types Compare
A look at four key metrics of law firm economics: profitability, profit margin, leverage and value per lawyer.
 
Jenner & Block led The Am Law 100 with the highest combined year-over-year growth rates for revenue per lawyer and profits per partner, though other firms posted significant gains, too.
 
 

Profits Per Partner
Average profits per partner were up by 5.3 percent in 2014, surpassing 2013’s increase of 0.2 percent.
 
Revenue Per Lawyer
The metric that we’ve long regarded as the most reliable measure of a firm’s financial health increased by 3.7 percent at Am Law 100 firms in 2014, reversing a decline of 0.4 percent in 2013.
 
Value Per Lawyer
On average, value per lawyer for The Am Law 100 rose by 6.2 percent in 2014.
 
Compensation—All Partners
Eighty-three firms posted increases, compared with 61 the previous year. Twenty-three firms posted double-digit gains, while two posted double-digit losses.
 
This metric, introduced in 1985, seeks to demonstrate which firms best balance leverage and profit margin for the highest possible profits per partner.
 
Our newest metric is an alternate way of looking at firm profitability and is intended to reduce the influence of factors such as leverage.