Linklaters, the Magic Circle law firm, halved the number of lateral partner hires in its 2023-24 financial year, even as average profit per equity partner climbed to a record £2.5 million. The firm reported that it brought in only 15 lateral partners, down from 30 the previous year, as it focused on internal promotions and cost control.
Record profits amid cautious hiring
The firm's total revenue rose 3% to £2.1 billion, while net profit increased 5% to £680 million. The average profit per equity partner (PEP) of £2.5 million was up 9% from £2.3 million in 2022-23, driven by strong performances in corporate, finance, and disputes practices.
Linklaters' managing partner, Gideon Moore, said the firm had deliberately scaled back lateral recruitment to prioritize integration and culture. "We have been very disciplined about lateral hiring, focusing on quality over quantity," Moore said. "Our priority is to ensure that new partners fit our culture and add value to our existing teams."
Focus on organic growth
The reduced lateral intake reflects a broader trend among Magic Circle firms to slow down partner hiring amid market uncertainty. Instead, Linklaters promoted 24 lawyers to the partnership internally, up from 20 the previous year. The firm also expanded its offices in the US, Europe, and Asia through organic growth rather than expensive lateral hires.
According to the firm's annual report, Linklaters now has 543 partners globally, of whom 462 are equity partners. The equity partnership grew by 12, while the number of salaried partners fell slightly.
Revenue growth driven by key practices
Revenue growth was led by the corporate practice, which benefited from a rebound in M&A activity, and the finance practice, which saw strong demand for restructuring and leveraged finance work. The disputes practice also performed well, driven by regulatory investigations and litigation.
Linklaters' revenue per lawyer rose 2% to £640,000, while total headcount remained flat at around 5,300. The firm said it would continue to invest in technology and artificial intelligence to improve efficiency and client service.
Looking ahead, Moore expressed cautious optimism about the market, noting that clients remained active but were increasingly focused on value. "We are seeing strong demand for our services, but clients are more price-sensitive than ever," he said. "We need to continue to innovate and deliver cost-effective solutions."
